Customer Segmentation: How to ‘Profile’ Your Subscribers and Boost Email Campaign Conversions
How do you maximize the effectiveness, engagement, and profitability of your email marketing campaigns?
By avoiding the costly mistakes that most email marketers make!
Too many email marketers interact with their list as if their subscribers are a faceless collection of wallets. It’s an understandable mistake. At least when you look at a crowd of people, you can see faces and be reminded regardless of how large the crowd is, they’re all individual people. But when you have hundreds, thousands, or even millions of subscribers in your email program, it is all too easy to forget that they are anything more than ‘your list.'
The power of email marketing is the ability to multiply your communication to an almost unlimited number of subscribers in a one-to-many medium. That power is amplified because email is a personal communication medium where most people get messages from friends and family, as well as commercial promotions. At its best, email marketing allows you to connect in a virtual one-to-one way and build a bond that can lead to ongoing profitability.
However, the Achilles Heel of email marketing is that you are not personally communicating with each subscriber and you cannot get the same feedback you would from an in-person meeting. With even basic communication skills, a salesperson can respond to a prospect’s facial expressions, body language and verbal responses. An email obviously cannot duplicate a truly human interaction. So at its worst, email marketing can be impersonal, clueless, ineffective, and even harmful.
In a moment we’ll go over some ways to make sure your email marketing campaigns take advantage of the strengths and benefits of email marketing while avoiding most, if not all of the downsides.
Before we do that, it’s important to understand what the problems are so you can effectively avoid them.
Here are just some of the problems that can result from treating your subscribers as a faceless email list, rather than a collection of individuals and why customer segmentation is such a good thing for your email campaigns:
- One size does not fit all: It’s too easy to forget that no matter how many emails you send out, they are read by individuals with different personalities, interests, biases, opinions, and preferences. While the response to your emails can be summarized in terms of average response rates, and you may still have a profitable campaign with a ‘one size fits all’ approach, it is far more effective to put in the extra effort to individualize your messages.
- Message to subscriber match: If you've ever told a joke in mixed company that some found funny and others found wildly offensive, then this next problem will be quite relatable. If your list lumps together subscribers who joined for different opt in offers, products, or even different time frames, then they may have very different interests and reasons for being on your list. For example, if you market to pet owners and lump them all into one list, then the next time you promote a dog training ebook offer you will at a minimum be of little interest to the folks who are on your list because they bought your cat food recipes ebook. More likely, they will feel that you wasted their time, that you don’t pay attention to what they care about, and worse, you may actually offend them. Over time, if enough of your messages don’t match your subscribers’ interests, then they will start to ignore future emails from you.
- Confusing prospects with customers: If your subscribers are all lumped into one list, you inevitably talk to them as if they are the same. However, some may have just subscribed today, some may have been with you from the beginning, and of course there is everyone else in between. Time is only one way in which your relationships can be different. Some subscribers have bought products from you and some have not. Some have bought entry level products, some have bought multiple products, and some may be personal high end clients or VIP members. So when it comes to your promotions, you have some subscribers who have heard it all, and some who may not be ready to hear a pitch yet.
The consequences of these problems continuing over time is that fewer and fewer subscribers will open your emails. Whether they unsubscribe and shrink your total subscriber count or if they simply stop opening your emails, the result is that your list health will suffer. If a high percentage of your subscribers don’t open your emails, it can harm your deliverability rate. Before you know it, more and more of your email messages will be filtered to the junk folder and your response rates will go down, regardless of how good your offers are. Customer segmentation is your best defense.
How do you increase your engagement and boost your campaign profitability?
One way to make your emails more engaging is to write to your subscribers in the second person, addressing one individual. So instead of writing to the group, you’d write the copy like this… using the pronoun ‘you’.
That personal tone may not be appropriate for your business, and that’s okay because there are other even more powerful ways to individualize your emails.
While you may not be able to see your subscribers’ faces, you can do the next best thing and pay attention and learn from their responses.
The first step in customer segmentation is to create separate lists that allow you to sort your subscribers by interest and the various stages of your relationship with them.
You should have a separate list for prospects and for customers. The primary focus for prospects is to get them to make their first purchase. How you promote to them will be different and you may offer special promotions to your prospects that would annoy your existing customers, who may have paid more for the same product.
You should also differentiate your customers so that you can determine who bought what and when.
For example, there is a big difference between someone who bought one entry level product from you 5 years ago and never purchased again… and someone who has bought all your products. Further, you want to be able to identify who has bought your most expensive products so that you know who your VIP customers are. That gives you the ability to target your best customers for special promotions or high ticket offers that prospects or new customers may not be ready for yet.
Creating different lists is simple in most email programs. With that said, it may take a few extra steps or customization to automatically ascend prospects to customer lists, but the rewards far outweigh the effort. Once you have your subscribers sorted by their relationship status with your business, you can include or exclude those who are not appropriate for any given email campaign.
One technique for reminding yourself that you are speaking to different people when you mail your list is to create avatars for each different kind of person that you market to.
Through researching who your subscribers are, it may be that they have different demographics and psychographics, not to mention gender, profession, family background, relationship status, or other differentiators.
You may find that the customers who buy your dog training book are predominantly men, aged 40 to 65, who drive trucks and like to hunt and watch sports.
And, you may find that buyers of your cat related products are predominantly female, aged 30 to 75, and interested in health related topics and art.
Once you know that your different products appeal to different target audiences, you can create custom marketing messages for each. In fact, you can create custom personas to be the face and voice of different lists that match the avatar of each list.
For example, you might have a male with similar demographics to reach out to your dog training list and a female persona to market to your cat product buyers. You may find that if your avatars are very different that it would be a good idea to have someone who genuinely matches your avatars to write to them.
You may not need to match the persona of your emails precisely to your avatars demographics, gender and so forth, but your values, opinions, and empathy for their likes and dislikes should line up as much as possible.
If you are just starting out and have not built a list yet, then set up different lists for each product and opt in offer. You may want to have your email software ‘tag’ each subscriber by what links in your emails that they click on as well.
If you already have a list with all your subscribers mixed together, begin the customer segmentation process by setting up lists to sort them by what they respond to moving forward.
You can offer topical free reports, webinars, and even Facebook like campaigns, to help you track what your subscribers like and segment them into lists accordingly. Note that to track these actions in your email campaigns, you’ll need to use HTML emails instead of plain text. You can always format your HTML to look like text emails if you prefer.
Once you have your subscribers segmented or on lists according to what they are interested in, then you can adapt your promotions to fit their interests like a glove.
If your dog lovers respond to a report on how to train their pooch to stay of the couch, you can sell them more information and resources in line with that desire.
If your cat lovers respond to a report on all natural remedies for common ailments for house cats, then you know what they are more likely to buy.
Once you have utilized customer segmentation to divide your list according to their interests, their behavior, and who they are, you have the power to boost your engagement and your profitability by matching what your subscribers truly want.
And, by carefully ascending your prospects to higher and higher levels within your product line, you have the potential to optimize your sales funnel according to where each subscriber is in the buying relationship with your business.
Author: Heather Seitz
For over a decade Heather Seitz used email marketing to build successful companies and had to solve the biggest barrier to consistent profitability: deliverability. Today she is the Co-Founder and CEO of Email Delivered.
To download your 8 Steps to segmenting your subscribers check list, click here: https://s3.amazonaws.com/EmailDelivered/8+Steps+to+Customer+Segmentation+Checklist.pdf . Remember to sign up for the FREE Email Delivered Pulse newsletter for articles, tips, and recommended resources for email marketers.
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