10 Email Segmentation Best Practices Smart Brands Use Published November 8, 2017 Most marketers know that to get the best results from email marketing they need to segment their data. After all, it’s the only way to create relevant, timely, and targeted campaigns that result in higher open and click-through rates. But, the difficulty is knowing how to segment effectively. How should you divide up all the bits of data you’ve collected about your customers to create commercially successful campaigns? In this blog post we take a look at ten email segmentation best practices that smart brands use to segment their email data. From the most basic, to more complex—we consider a range of ways to understand, group, and target customers. 1) Geography Any marketer who is trying to raise the profile of stores, offices, or services in certain locations needs to know where their customers are located. It’s no good telling a customer about what’s going on in your Glasgow branch if they’re based in London and unlikely to visit. Getting the location wrong makes your marketing irrelevant and potentially annoying. If you’re sending location specific communications then always segment your customers by their geographical location. 2) Age Segmenting by age helps you to ensure your marketing age appropriate. This is particularly important in some sectors—such as health, cosmetics, or fashion—where products may be aimed at certain age ranges or lifestyles. Try grouping your customer within relevant age ranges, and send them products that are the most relevant, to maximise your chances of conversion. 3) Gender It’s no good sending someone female-focused fashion if they don’t identify as female. If you’re marketing a lifestyle product then always ask your customers about gender—don’t make assumptions that may accidentally alienate or confuse them. By asking customers about their gender you can send them the most relevant and engaging content suitable to their specific lifestyle. And don’t make the mistake of only offering binary ‘Male/Female’ choices. An increasing number of people are choosing to identify differently and showing you understand and welcome this will go a long way. 4) Interests It’s easy to segment your emails by customer interests if you have an email preference centre. This lets customers tell you what subjects or themes they want to receive information on. You can also use behavioural targeting software to monitor what they click, visit, and browse to build up a picture of what they like. Once you have behavioural data you can group customers by interests and send them emails on relevant categories, content, or products, to increase engagement. 5) Personas Personas are imagined representations of the different types of customers you have. They’re often created and pieced together through data, customer interviews, research, and surveys. You can group customers into different personas by using their gender, age, income, status, behaviours, goals, and challenges. Once you know which different personas people conform to you can send them marketing that’s relevant to each customer type. Varying your offers, messaging, and tone of voice to suit each persona may help increase engagement. 6) Purchase history It’s normally quite easy to divide people into segments according to what they’ve bought with you in the past. It doesn’t need to be in detail—simply using category type will give you a good indication of what they’ll want to hear about and buy in the future. You can create segments such as ‘beauty buyers’—or drill down to specific products such as ‘mascara purchasers’—and recommend similar products or complementary purchases. 7) Engagement Segmenting by engagement is about grouping people together by how often they open, click, visit, or buy. Individuals are often given ‘engagement scores’ which are used to decide whether people are ‘highly engaged’, ‘engaged’, or have ‘low engagement’ levels. By doing this marketers can send the most relevant campaigns to encourage the different behaviours they want from each group. You can incentivise ‘highly engaged’ recipients to refer friends, stimulate ‘engaged’ people to interact more, and send reactivation campaigns to people with low engagement levels. 8) Purchase cycle Look at where customers are in their journey with you—are they simply a first-time browser or have they just purchased? Depending on where they are in their purchase cycle customers need different information from you. You can nurture first-time visitors with emails informing them about the brand, prompt repeat visitors to buy, and request feedback from customers who’ve just purchased. Segmenting by purchase cycle is a commercially savvy way to talk to your customer that gently pushes them towards a sale, with relevant and timely messages. 9) Recency Frequency Monetary (RFM) Some segmentation techniques don’t just employ one set of criteria to divide customers up into groups—they look at multiple factors. RFM segmentation scores the customer depending on when they last bought (recency), how often they purchase (frequency), and their spend level (monetary). Each factor is given a different weighting and contributes towards an overall score which tells the brand how valuable the customer is. The customers are then divided into groups depending on their score levels and sent the most relevant campaigns to their behaviours. 10) Spend and Customer Lifetime Value (CLTV) Looking at when and what your customers spent with you is another way to segment your data. Some people may spend frequently in low amounts, whereas others might make one high-value spend just once a year. Don’t assume one is better than another—if you want to get really sophisticated then use a customer’s spend level to work out what they’re worth to you over your entire relationship with them. This is called working out their Customer Lifetime Value or CLTV as it’s sometimes known. Takeaway Each different method of segmenting your customers offers it’s own pros and cons and might be more suitable for some markets than others. But whatever you do, we recommend trying to evolve your segmentation strategy as you find out more about your customers. And to really get the bigger picture you need to make sure you have all your data in one place so you can take all of your customer’s behaviours, actions, and interests into account. Our PureIntelligence software will let you feed in all of your customer data from multiple sources and systems such as your website, emails, tills, and other customer touchpoints. It lets you see an overall picture of how and when customers are interacting with your brand. Once you’ve collected the data together into a single customer view the software will identify patterns and trends to tell you about what they’re likely do in the future. It will then help you create and manage your segments and use PureTargeting to send our targeted campaigns to your new-found customer groups. To learn more about segmenting and engaging your audience, speak to us about our eCommerce solution.