[Success Kit] How To Design A Marketing Segmentation Strategy
To say a “marketing segmentation strategy” is quite a mouthful and might not be easily understood. In it’s simplest form, it’s the strategy behind how someone categories their list of different target customers.
Wikipedia defines Market segmentation as “A marketing strategy which involves dividing a broad target market into subsets of consumers, businesses, or countries that have, or are perceived to have, common needs, interests, and priorities, and then designing and implementing strategies to target them.”
Having a marketing segmentation strategy allows you to increase open/click rate and decrease unsubscribing by only sending information to the segments that would be interested in it.
There are two different types of segmentation;
- Explicit Segmentation: Characteristics of a customer defined through conversation, lead generation or purchase behaviour e.g. potential customers who signed up to a webinar of mine in the last month.
- Implied Segmentation: Characteristics of a customer define through their actions, demographics or purchase behaviour e.g. customers who downloaded a guide via one of my leadpages.
People are much more complicated and sometimes, you can’t generalise based on their location or gender. Segmentation is, in essence generalisation and it is impossible to avoid this completely.
WHAT MAKES A STRONG SEGMENT?
There are 5 characteristics you should consider when creating a segment;
- Concentrated, but Significant: Focused enough to build a “segment” but not too specific that is causes a headache to your marketing campaign.
- Diversity: Your segments must be different from one another otherwise there is no point in segmenting that list — it could easily be combined with another.
- Relevance: All of your segments must have some sort of structure based on relevance. You need to make sure the segment is relevant to your business; I would never segment a list based on gender because my target audience niche isn’t defined by this.
- Actionable: You must always have a tailored call to action for each segment (if applicable), to get the best possible ROI.
- Stability: Build your segments based on the longevity of your list. I have lists that have an open rate of over 20% and a click through rate of over 3.5% which is above the industry standard of 18.41% (open rate) and 2.09% (click through) because I have nurtured these lists.
HERE IS MY MARKETING SEGMENTATION STRATEGY FOR EMAIL MARKETING;
- A potential customer signs up to a webinar of mine about a specific subject
- I am given their name and email address, as part of the signup process
- Everyone who signed up for the webinar goes into a NEW, specific list within my Mailchimp Account.
- I send them a unique email with all of the information they wanted to receive after attending my webinar.
- Now I have a segmented list which then goes in my email marketing software to then have a series of focused emails and added value content sent to them.
- Should a customer be interested in my products or service, they can sign up or come into my sales process to see how I can help, whilst I am always adding value.
Depending on the list, I may combine with another list. For example, I have a list of trade show/event organisers which I will NEVER combine with another list as this is niche, and only for a specific purpose. I might have three different lists based on three webinars I have run over the last few weeks on the same subject. I tend to combine these lists at a later date, as their needs are the same.
What is your marketing segmentation strategy?