Segmentation and Targeting
Why is segmentation and targeting so important?
Check out these anonymous case studies
#1 - RELEVANCE MATTERS
Imagine how frustrating it is when every email I open features a product that
> Doesn't come in my size
> Doesn't work on my hardware platform
> Doesn't depart from my city
Why would I even keep opening those?
In this case study,
the company was spending all their marketing dollars
on all their customers
featuring one particular merchandise category
because that category represented 90% of their revenues
But segmentation revealed these insights:
> Those 90% of revenues came from only 2% of customers
> Retention was OK amongst those 2% of customers
> But retention amongst the other 98% of customers was failing
> And there was virtually no acquisition into that 1 merchandise category
this company had no idea that most of their marketing budget was wasted.
You may treat all your segments the same, but they're NOT treating you the same!
#2 - GEOGRAPHY MATTERS
When does geography matter?
> Multichannel retailers with local store news or regional offer testing
> Internet-only etailers with climate specific merchandise
> One-hour flash sales where time zone affects response
In this case study, the email database did not collect or store zip code.
So the company couldn't leverage email for any of the above benefits.
We mapped the zip data from the multichannel database to the email database
and discovered zip code on the majority of the email list.
Now, emails support store news, direct mail, stores near you, and more.
That data mapping also enabled purchase history to be leveraged for relevance.
#3 - TARGETING REQUIRES DATA
How can marketers collect data for segmentation & targeting?
> The customer's explicit preferences using interactive forms
> The customer's historical purchase patterns
> The customer's historical click patterns
Effective ways to solicit explicit preferences:
> Sweepstakes forms with required fields for name, zip, preferences
> Interactive promotions with required fields
> Rewards progams with required fields
> Email Links that let the customer tell you the message is off-base
> ...Programs I can help you launch on spec,
on time, and on budget