Marketing your biz better: part 4: Segmentation & Targeting

As a treat, I’ve written a true story.

A Christmas ten years ago in a sleepy town south of London…

I remember when we would write up a few paragraphs of copy, stick in a link to the website homepage, attach our database and click the send button. Nice and easy. One message, one creative, one database.

We were all happy campers back then, but disaster struct when analytics burst into our lives and suddenly we saw the failure that was in it. Our emails were being received, but no one was reading or interacting with them.

Why?” we all screamed. Why is Alan Smith not interested in our email on pretty candles, why is seventy year old, Tom Gavin not buying when we’re discussing the latest technologies? Then, bam! Like being hit by the 8:50am express train, we got it.

Our content isn’t working because we’re not segmenting our database and targeting.

So, we gathered around the ‘thinking’ table and began to look at ways of targeting. This included a bunch of scribbles and diagrams, a discussion on who our customers are and how we could categorise them. We looked at:

  • Demographics - age, single, couple, family, retired, social status, income
  • Geographics - local, regional and global
  • Purchasing behaviours – what, when and how much
  • Level of interaction – loyalty and regency on the website, number of purchases and website visits
  • Behavioural patterns – Visits resulting in a purchase, visits that didn’t, ave’ sale amount, how many pages were viewed prior, referrers

Basically, we didn’t sleep for six days until we had exhausted all possible segmentation ideas and the number of databases were well over one hundred. On the seventh day we rested.

The following month we took each version and asked some business-style questions:

  • Who does this target?
  • Why should we target them?
  • What offers/incentives/products/services could we include?
  • How many segments should we use?
  • What results can we expect?
  • How will this increase clicks and sales?
  • Should we use this/these segments continually or on an ad hoc basis?
  • How can we assess the response rates

We fired questions back and forth until an impatient owl hooted outside and the clock struct 8pm.

The next day we started a stategy plan which included our chosen segments. We were now targeting smaller groups of people with similar purchasing patterns. We took into consideration the best times and days to target them and our creatives reflected the message and customer type.

Almost immediatly, sales were up. Loyalty increased over time and we were back to being happy campers.
But we learnt something vital in the process. Segmentation and targeting works, beause:

  • You focus on a smaller number of people with something in common
  • You improve click through rate by closely matching interests
  • You set creative and copy which appeal to the target
  • It stops your target switching off
  • It persuades targets to be loyal
  • It lets you set specialised content
  • It allows you to track segments independant of each other

What are your experiences on segmentation and targeting?

Did it work for you?

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