Crank Up the ROI of Your Email Marketing Campaigns With Segmentation

By Daniel Faggella

Anyone can send an email marketing message, but sending the right message to specific targets is key to successful marketing. To make the most of your email marketing campaigns, it's crucial to segment your email lists so that you can implement data-driven customization.

Segmentation not a complicated process. When you segment your email list, you use the information you have about the recipients to create smaller subgroups that can be targeted more specifically; and by sending recipients more relevant information, you can significantly increase the results.

Benefits of Segmentation

The benefits of segmenting your email lists are manifold. According to global digital marketing expert Lyris, marketers benefit from segmentation in the following ways:

• Increased email open rates—39%
• Reduced unsubscribe rates—28%
• Increased revenue—24%
• Increased sales leads—24%
• Greater customer retention—21%
• Increased transactions—18%

Where to Begin

Start segmenting by separating your leads and prospects from your current clients. Although some of your email content may be suitable for all audiences, some information will be more significant for one than the other. If content is more relevant and timely to a recipient's needs, they will be more likely to enjoy it, and they will be more responsive. Segmenting your leads can be tricky because you may not have sufficient data for all of the people on your list. If this is the case, you need to glean more information from them so you can get started.

There are multiple ways to slice up your email contact list. The important thing to remember is that though many of these ways work well alone, you can reap the most benefits by using them in combination. Your goal should be to not only try to yield a higher monetary return per month from your email marketing, but also to send relevant communications to relevant readers so that your relationships remain strong (and profitable) for as long as possible.

1. Segmentation by Demographics

Different genders, age groups, and people in different regions communicate and think differently. For this reason, demographic factors such as gender, age, geographic location, education, marital status, and occupation all contribute to a beneficial email list segmentation strategy.

For example, if you are marketing air conditioners, you may want to promote a special offer in geographic regions with overall higher temperatures; or if skateboards are your products, you will want to target younger people. Having regional, age, and gender data on your list (taken from surveys, order forms, registration processes, etc.) allows you to match messages to the people who will actually care.

2. Segmentation by Industry

This is a particularly valuable way to splice your subscriber list if you are a B2B email marketer. If you are promoting and selling to other businesses, organizing your contact list by industry can help you customize your content and promotions to target customers' specific needs.The more information you can gather about your contacts' industries the better; consider data such as a person's position within a company and their purchasing influence. In this way you can inspire people to make decisions that will benefit your business.

3. Segmentation by Purchase Interest

If a portion of your list has already purchased from you, use their information to create emails catered to their interests. Also take advantage of surveys to learn about your contacts' future purchasing intentions. Be aware of any indicators that show purchasing interest -- customers looking at a pricing page, products clicked on in an email, and lead magnets customers subscribe to -- and use this information to target contacts.

4. Smaller Segmentation Filters

There are additional finer filters you can use to segment your contact list. These include:

• How contacts connected with you (lead source)
• Customer satisfaction ratings
• Type of preferred content (tracking click activity)
• Types of email address (gmail, work email, etc.)

Any of these filters could be relevant to your business, and if so, should be automatically tracked and used in your marketing efforts.

Segmentation Now

Though it might seem like a huge challenge to segment your own subscribers, there are a number of ways you can implement segmentation into your database right now. You could add a second page to a registration form, or simply lengthen an initial registration page (as long as the length increase doesn’t negatively effect conversions). You could send out monthly polls or surveys, or require certain data on your order forms.

For many businesses, it’s as simple as adding an important drop-down field under your general email subscription form (for gender, age group, industry, or whatever the most relevant segmentation might be), instantly adding relevance to each new lead and helping to instruct your future marketing efforts.

Whichever combination of segmentation you choose, your primary objective is to increase interest, engagement, and ultimately revenue. Remember that not all contacts on your email list are the same. Consumers want to receive information that is relevant to them specifically. Bear in mind that 56 percent of consumers name irrelevant content as one of the number one reasons they disengage from an online brand.