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Personalisation, Personalised Direct Marketing, Big Data, Marketing

Marketing segmentation – the key to success

Written by Jason Groom
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Originally published
April 6 2016,
updated
May 26 2019

"You want to be where everyone knows your name…" These were the lyrics from a really popular television sitcom Cheers set in a Boston bar back in 1980’s. While you’d have to be “of a certain age” to remember it, even if you don’t the sentiment is pretty clear. Who wouldn’t rather spend their evenings cosily amongst friends in familiar surroundings, rather than anonymous and alone in a big and hostile city?

Now you see it, now you don’t
But while remembering and using someone’s name is a starting point for familiarity, really getting to know them requires a little more investigation, work and probably patience.

The need to “get personal” with customers and prospects is widely accepted – we do our own fair share of banging on about it too - but as Will Shuckburgh Nectar’s managing director says, personalisation should also be about “what the customer can’t see”.

What segmentation means
Back in the day when we talked about “slicing the data” it was mostly around the firmographics – the vertical market, size of business, geographical location, etc. (in the B2B world). So, we might have focussed a campaign on all organisations with a certain number of employees within a radius of 30 miles of Manchester, for example. Close, but no cigar as they say.

While all of this tightens our focus, our ability now to track and understand the customer so much better, and at an individual level, means we can drill-down and might segment further by, for example:

  • Demographics - gender, age, language and site-location of the recipient
  • Behaviour – his preferred method of purchase (online, by phone, instore), level of brand engagement, purchase frequency, volume and value
  • Interests, hobbies and preferences where these are known

Truly one-to-one conversations
Treating your customer and/or prospect database as simply an amorphous clump of records from which fields are selected, results in messaging so “vanilla” it resonates with no one in particular. But aligning your message to the recipient’s needs and behaviours avoids that and results in more meaningful communications and subsequent conversions and customers.

The benefits of segmentation
MailChimp recently published the results of its research* across 2000 users who, between them, sent some 11,000 segmented email campaigns to almost 9 million recipients.

Opens:

14.37% higher than non-segmented campaigns

Unique Opens:

10.22% higher than non-segmented campaigns

Clicks:

64.78% higher than non-segmented campaigns

Bounces:

0.90% lower than non-segmented campaigns

Abuse Reports:

5.74% lower than non-segmented campaigns

Unsubs:

8.98% lower than non-segmented campaigns

The results of these, compared to the results of the same customers’ non-segmented campaigns, are pretty compelling, aren’t they? Enough to get you segmenting? We hope so!

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