When it comes to nurturing long-term customers, it’s important to put yourself in their shoes: What keeps you coming back to certain shops and products? For many, the answer to this question revolves around shops that resonate with them. The marketing of products and services is most successful when customers feel seen and heard. That’s where segmentation marketing can turn a one-time buyer into a lifelong customer.
What is segmentation marketing?
Segmentation marketing is the process of dividing your customer base into groups based on commonalities around what they respond to and how they shop. Since some of your customers may have different pain points, desires, and experiences than other customers, segmenting allows you to speak to each group of customers in a way that resonates specifically with them. Overall, segmenting is the process of creating tailored experiences for large groups of customers.
By incorporating segmentation into your marketing strategies, you can better foster customer loyalty by creating a brand that really speaks to your customers. Through retention, you also encourage higher conversion rates overtime and can create better products and experiences for your customers since you can understand them more deeply through segment testing. All of these give your company a competitive edge over other businesses.
How can we segment our customers?
There are a variety of ways you can analyze your customer base and divide them into segments. Some common groupings are based on the following:
- Demographic – you can segment your customers on factors such as age, income, gender, race, education, and occupation.
- Geographic – you can segment your customers based on their physical location.
- Firmographic – If your customers are other businesses, you can segment your customers based on factors such as employee count, office space, customer markets, revenue, and so forth.
- Psychographic – you can segment your customers based on their personalities, lifestyles, opinions, and interests.
- Behavioral – if you have data collected on your customers, you can segment them based on how they act: what they buy, spending habits, ads they click on, and so forth.
How do I get started with segment marketing?
Define your goals
Before you start pondering segments and strategies, it’s important to define what you want to get out of segmentation marketing. Increased customer retention, improved engagement, boosted sales, and so forth are possible goals you may want for your business. These goals will guide you as you establish your segments.
Identify segmentation opportunities
To divide your customer base up into segments, you need to understand who your customer base is and determine what criteria would be applicable to your specific market. As with most content creation, you need to have a good understanding of what kinds of people your products and services are for. What are their pain points, needs, and expectations? What are some commonalities between them that pop out immediately to you? It is in this step that you will start to determine what kind of segments best suit your customer base: demographic, psychographic, behavioral, etc.
Note: Be wary of being too niche
When you begin to create segments, you need to keep in mind the size and profitability of them. We can segment our customer bases into a variety of small groups with niche interests and characteristics, but if creating and implementing marketing campaigns for those niches cost more than what your company would gain in return, the segment may be too niche to work. Be careful of dividing your customers into too small segments.
Establish your ideal customers
Once you have a collection of valuable segments, an activity that can help you get started brainstorming content for each segment is to identify your ideal customer for each segment. Who are they? What do they want? What are their struggles? What do they respond to in existing marketing? By answering questions like these, you can start to come up with ideas for content that will again resonate with each segment.
Craft target messages and offers
With your ideal customer per segment in mind, create marketing material that is tailored for each group. One thing to keep in mind is that the message should be coherent per segment and, to a degree, should make sense in the narrative of your overall business message. An example could be that you sell apparel and are dividing up your marketing based on the products bought. How you talk about shoes may be different than how you talk about dresses. Your company’s main message may be to sell quality apparel. That message should still be present in your segment marketing for both shoes and dresses.
Implement, Measure and Refine
Once you have your content created, it’s time to incorporate those into your communication channels. An important factor to keep in mind is planning out how you will track the success of each segment implementation. For your website, you may use an analytics program like Google Analytics 4 to track how engaged your customers are with your segmentation marketing. For your emails, you may use built in analytics from your email management system, such as with AWeber, to keep track of how well your segment is working. Overall, you want to determine the success of your segment marketing and change it as needed.
Note: Stay updated on your customer base
It’s important to keep in mind that your customer base will grow and change with time. Certain segments of customers may change in their preferences and needs, meaning that you need to stay up to date with your customers’ desires and the successfulness of your existing segments. You may need to dissolve some segments and divide your customers into new ones as your customer base evolves. The best way to stay informed is to collect and analyze data on your customers and segment campaigns.
Where to use segmentation strategies
Once you have a segmentation strategy set up, you can incorporate it into your marketing. Some common places you incorporate your segmentation marketing into are on are your website, social media channels, ads, and customer emails. All of these places are customer facing and may be the first place that a customer is introduced to your products and services. Each communication channel will need tweaks in terms of how you incorporate your marketing into them, but ideally, they should be sharing a coherent message to your segmented group.
Want to learn more?
The better you understand your customers, the better you can craft a business message that meets them where they are! Read our blog or listen in to our podcast for more tips and guides on making your business the best it can be! If you want more hands-on guidance for improving your website, join the waitlist for Carrie Saunders’ upcoming course, “The Converting Website.” In this course, she will dive into a variety of important factors that aim to optimize your website.