Segmentation & Targeting INSIGHTS
Insight #24 - MEAI Segmentation
Depending on who you are, you might find this a horribly boring topic. But it's what floats my boat!
Mutually Exclusive, All Inclusive
Whenever you're building segments, you should aim to achieve MEAI and build a proof segment, even if you don't intend to target everyone. Why? Because it's the only sure way to prove that your targeting criteria is accurate.
- Men & Women.
Count the men, count the women, and count your total.
Oops, why doesn't it add up?
Because not everyone has gender identification.
This is an obvious one, but marketers can go for years without realizing they're skipping over significant portions of the list.
Plan default content for the "unidentified."
Making MEAI a matter of routine will bring extra insight every time!!!
- Recent, Non-Recent, Inactive, Never.
Maybe you're not even planning to target the "Never" group but count them anyway and make sure all of these segments add up to 100%. You may discover errors or gaps in the data or errors in your query.
- RFM Segments (Recency, Frequency, Monetary rankings).
After assigning the RFM code to everyone, add up your segments and make sure everyone is in one, and only one, segment.
You may discover errors in the RFM logic.
For example, this was a HUGE insight for me early on.
I discovered that anyone whose spending was right on the $.00 between each segment was getting left out of the RFM altogether. AT the same time, I discovered that the Recency logic left out a bunch of customers because it was not accounting for leap year.
It always pays to routinely insist on MEAI.
Insight #19 - Tactful Targeting Part 3
We're on Part 3 of a 3-part mini series on Tactful Targeting.
Part 1 was about Convenience without Constraint (Blog #17).
Part 2 was Initiating Intimacy (Blog #18).
This week is Relevance with
Here are a few principles:
Propose, Don’t Presume. This is as much about opt-in as it is about targeting. Take every opportunity to get a hand-raiser onto the email list. Make it easy, make it an automatic part of every process, even make it unavoidable. But show some respect; don’t make it invisible or inescapable.
Hit the Spot, not the Nerve. You can target relevant content without hitting your customer over the head with the message. Sometimes, the customer shouldn’t even need to know she’s getting anything out of the ordinary.
Predict, but Don’t Pigeonhole. If your analysis has “pegged” someone as a Square, be sure to invite the customer to let you know she’s a Circle. How do you do that effectively?
- Your business is computers and your analysis says Mac.
Add a PC "tab" to the email. The landing page will be the PC version of the same email campaign.
- Your business is computer games and your analysis says Xbox.
Add a Wii "tab."
- Your business is menswear and your analysis - or even his preference page
says Big & Tall.
On your Suits campaign, provide two links: "Shop Big & Tall Suits" and "Shop All Suits."
Remember, even if you have your customer pegged right, sometimes he’s shopping for something different, or for someone else.
A little tact and some customer-centric consideration goes a long way!
INSIGHT #18 - Tactful Targeting Part 2
We’re on Part 2 of a 3-part mini series on Tactful Targeting.
Last week I referenced a NY Times article spotlighting high-profile retailers that blew it with targeting that backfired. Part 1 of my little series was about Convenience without Constraint (Blog #17).
This week is on Initiating Intimacy. Repeated handshakes and courteous courtship create intimacy and mutual expectation, and they drive response revenues.
Put Your Hand Out. Keep finding new opportunities to offer your hand. Here are some hand-shaking opportunities to give your customer:
· Submit a preference page
· Submit a survey
· Submit a customer rating
· Ask you to let her know when something comes in
· Set a permanent website default (such as her size)
· Join a points-based rewards program
Here are some other quick and easy handshakes.
Preference Page links in your order confirmations, welcome campaigns, customer service emails, and in your email footers.
Preference Page in place of a confirmation page right after someone subscribes.
Feature “opposites” in email campaigns and web pages (his/hers, Mac/IBM, adult/child, petite/tall); when she clicks on one or the other, capture that in a stored data field, and target future campaigns and dynamic site content based on that choice. But don’t forget Convenience without Constraint (blog #17)!
Date Your Customer. Increase intimacy over time by continually courting your customer. My daughters tell me that at some point, he has to ask you to be his girlfriend; as marketers, we shouldn’t keep our customers waiting for that too long! Here are some courting courtesies:
· Call her by name
· Call her by the right name
· If she told you her birthday, then wish her a happy one
· If you let her request mail, then send her some
· If she told you where she lives, then tell her about store events in her area
· Don’t ask her to join your rewards program if she’s already in it
· Don’t ask her to “join the list” if she’s already on it
· Give her genuine benefits for staying on the list
· Every time she “listens” to you, ask her one more thing that you care about
How does she “listen” to you? When she opens your email, when she looks at your website, when she visits you on Facebook, when she walks into your store.
And how can you ask her one more thing that you care about?
Form on email. In every email, include a simple banner that has a one-question form. Make the form dynamic, so if you already have her answer to the question, either queue up the next question or just don’t display the form. Prioritize the questions so you begin with the most appropriate intimacy level.
A little tact, and some customer-centric consideration goes a long way!
Next week: Relevance with Respect.
INSIGHT #17-Tactful Targeting
Did you catch the recent NY Times article, "E-Tailer Customization: Convenient or Creepy?"
It was about high-profile retailers that blew it with targeting that backfired.
A little tact and some customer-centric consideration goes a long way!
Here are some things to keep in mind with your targeting and customizations.
The first one is: Convenience without Constraint.
Create convenient and easy encounters, but don’t constrain your customer’s ability to broaden beyond their previous inclinations.
Let’s look at an example. You know he’s big and tall (either from purchase history, previous browse behavior or explicit preferences).
In his emails, always give him an extra link that takes him directly to the Big and Tall section of the featured category… But also give him the normal link that takes him to the whole category. And feature an evergreen footer link such as “Not Big and Tall?” so he can re-set your targeting.
In your data, always keep a flag that the customer can set to NO! And never overwrite explicit preference with inferred data.
On your website, feature Big and Tall on his homepage, default to the Tall size selection on his product detail pages, give him Big and Tall product recommendations. But leave
all your normal navigation intact so he can freely shop the whole site.
…And if you sell mens AND womens, feature his and hers tabs on your homepage and add his and hers tabs in your emails. The email you deploy will feature whichever was his explicit preference or the most recent purchase or browse category, and the other tab will land on a shopping page that looks just like the email, with a similar offer, but featuring the opposite category.
Mantra: Make everything EASIER, but make nothing HARDER.
I'm going to spend two more weeks on this topic. Next up: Initiate Intimacy.
INSIGHT #9 - Rubix Reform
Last week I introduced the Rubix Rubric segmentation.
This week, we’ll start thinking about the many ways to twist and turn that Rubix Cube.
Recall, we segmented based on recency of 3 customer behaviors:
- Buyer Recency (5 segments)
- Subscriber Recency (4 segments)
- Open Recency (5 segments)
Every possible combination of those will give you 100 segments.
First thing, we need to begin validating the segmentations,
because you're going to need some Rubrix Reform.
You’ll find new subscribers whose last open was a year ago; shouldn’t be many of those but REsubscribers make this a possibility.
You already knew you had inactives, but now you’ll come face to face with big segments of people who have been subscribed for years and never opened or bought. If you weren’t already managing your inactives, now you will.
If you look under a rock, you’ll discover a lot of “non-buyers” who subscribed during a transaction. Oops. This isn’t surprising because multi-channel retailers have a hard time matching transactions to customers. But if you have a lot of these, do figure out a way to get them out of the “non-buyer” segments.
The more you twist and turn your Rubix cube segmentation, the more you’ll discover flaws in your data, and the more you’ll understand about the dynamics of your list engagement.
You’ll identify specific segments (or groups of segments) that are big enough and important enough to merit data correction and more analysis and testing so that you can develop programs to move more of your list into the more valuable segments.
Next week, we’ll explore profiling your segments. And eventually we'll get to testing and targeting your Rubix Rubric.
INSIGHT #8: Rubix Rubric
Up to now, all my newsletters about segmentation have scratched the surface – preliminary, readily accessible, right-brain, logical segmentation.
But today we start the journey toward the deep. And yet, we keep it simple!
There are a million ways to cut your customer base. I like a Rubix Cube segmentation strategy. Here’s how it works.
Choose three aspects of your customers’ value indicators.
- Buyer Behavior has to be one of them (unless you don’t sell anything).
- Acquisition should be another. Maybe it’s buyer acquisition or subscriber acquisition or social acquisition or channel acquisition. Get it?
- Engagement can be the third. Engagement comes short of purchase, but pick some important customer interaction.
Now we choose one metric across all aspects. The metric I favor is Recency. But you might choose a volume metric, like dollars or counts. Here’s a hint: the old faithful RFM score (Recency Frequency Monetary) is called that for a reason – Recency is the most important metric.
It’s important to keep this manageable, so pick 3 to 5 bands for each metric.
Here’s how it might look.
Buyer Recency: Purchased in the last
Subscription Recency: Subscribed in the last
Opened in the last
It’s very easy to assign a Buyer Recency, a Subscriber Recency, and an Open Recency to each subscriber.
But here’s where the Rubix Cube comes in: Once that’s done I can combine the 3 metrics, and the above example will give me 100 segments.
What we DO with the Rubix Cube is where the magic will begin!
INSIGHT #5 - SIMPLEST DYNAMIC MESSAGING
April 2, 2012
You may be thinking that dynamic content sounds too hard. But it’s the easiest first step toward personalized messaging.
Why is it easy?
- No impact on workload
- No impact on campaign cadence
- Start with what you’ve got & expand as merited
Why no impact on workload?
Start with any segmentation that’s readily accessible, create a somewhat evergreen creative or copy, and insert this customization based on a pre-defined criteria. One-time set-up and let her rip.
How is this different from triggered campaigns?
Triggered campaigns are dedicated to one topic; they fire off whenever a customer does something (or doesn’t do something). They can pile up – in an email inbox or in your direct mail budget – because you also happened to send a marketing campaign to the same person that same day or time period. To avoid these “pile-ups” requires some special handling (see next week’s blog).
But dynamic content never “piles up.” It rides along with whatever you were already planning to send.
Want some examples?
Use dynamic content:
- In the subject line (name, size, category, reactivation copy, etc.)
- In a top or bottom banner (stores near you, special interests, etc.)
- In the main image (an extra shopping link to the petite section of whatever is being featured)
Never use personalization to “box in” your customer. If you include a link to Narrow Booties, also include a link to All Booties.
Here are some sample segmentations that might be readily available:
- Size – Infant|Toddler, Petite|Tall, Narrow|Wide, etc.
- Event – Wedding | Graduation | Birthday, etc.
- System – Mac/DOS | you know who you are…
- Activity – Recent /Non-Recent Buyer | Recent /Non-Recent Clicker, etc.
- Geography – as in stores near the recipient’s zip, time zone, etc.
Where do you get the data to support dynamic personalization?
- Buyer Behavior
- Click Behavior
- Browse Behavior
- Explicit Preferences
If you’re inserting into direct mail pieces, be careful about the ROI. If you’re inserting into email, it’s ALL gravy! So guess where you start with dynamic customization?