When you hear that you’re supposed to segment your audience to improve your marketing, many companies simply look at surface-level information like age, gender, and location. But good segmenting needs to go deeper.
Today we’re breaking down different characteristics your company can use to better segment your audience, why it’s important to conversion rates, how to incorporate it into personalized marketing, and additional resources to help you master this essential marketing task.
What Is Marketing Segmentation?
Market segmentation is the process of dividing a broad target market into smaller, more defined groups based on shared characteristics. These audiences can then be targeted on social media, email marketing, or website pages.
Why Is Audience Segmentation Important?
Imagine you’re a managed services provider who offers cybersecurity services to companies. You want to email your potential client list offering these services. Your list is a diverse group of businesses and organizations across multiple industries and varying annual revenues. So should you just email them all the same message? Absolutely not! By sending the same message you’re not truly connecting with each group’s needs and pain points.
As the saying goes, "If you're marketing to everyone, you're marketing to no one."
In our example, a message to a medical facility would want to focus on ways to stay compliant with HIPAA regulations, while a message to a small organization would focus on budget-friendly options. By tailoring your messaging to each audience segmentation, you identify with their specific needs and increase your chance for a sale.
And if you’re wondering, “How can audience segmentation enhance my inbound marketing efforts?” look no further than these statistics:
Segmented email campaigns saw a 14.31% higher open rate and 101% more clicks versus non-segmented emails.
88% of users agree they are more likely to respond to an email favorably if it looks like it’s been specifically created for them.
80% of companies that use market segmentation report increased sales.
20% of marketers who use segmentation see a 20% increase in ROI.
Statistics Source: notifyvisitors.com
Ways To Segment
Like in all aspects of marketing, there are many ways to segment your audience. It will all depend on your company, its products and services, and goals. What works for one company may not work for another. But having a strong understanding of who your customers are, what makes them tick, and other important information can help you get a clearer picture of what segmentation will work best for you. Let’s look at the different categories and elements of each.
Geographics
Postal codes: Used for hyperlocal targeting, especially for brick-and-mortar businesses or services with geographic limitations.
Socio-Economic Indexes for Areas (SEIFA): Identify areas with similar socioeconomic characteristics to tailor products or services accordingly.
Town, City, Region, Size, Climate: Determine where to focus marketing efforts based on population density, climate, and consumer behavior.
Communities, Countries, Rural, Suburban, and Urban Areas: Identify cultural nuances and preferences to create culturally relevant campaigns.
Demographics
Age: Tailor products and messaging to specific age groups and their needs.
Gender: Create marketing campaigns that resonate with specific genders.
Nationality, Race, Religion: Understand cultural differences to create inclusive and respectful campaigns.
Income, Education: Determine purchasing power and tailor offerings accordingly.
Language spoken: Create marketing materials in different languages to reach diverse audiences.
Psychographics
Budget: Tailor product offerings and pricing to different spending levels.
Motivators, Emotions, Beliefs, Values: Understand what drives customer behavior and create emotionally resonant campaigns.
Pain points: Identify customer problems and offer solutions through marketing messages.
Social & cultural norms: Align marketing efforts with cultural values and expectations.
Opinions, Roles, Activities: Understand how customers spend their time and tailor marketing messages accordingly.
Behavior
Hobbies: Identify shared interests to create targeted campaigns.
Purchasing styles: Understand how customers shop (online, in-store, impulse, etc.) to optimize marketing channels.
Social media use, Mobile phone use, Media consumption: Determine the best platforms to reach the target audience.
Segmentation's Role in Personalized Marketing Strategies
Now that you’ve looked over your customer/potential customer list and have identified how you will be segmenting them, it’s time to incorporate it into your marketing strategy. For more information on how to enhance your personalized marketing, check out our recent blog on this topic.
Taking It To The Next Level
If you want to take a more in-depth approach to learning about audience segmentation or you're looking for tools to help you improve this marketing task, we've got you covered.
Books
The Death of Demographics: Valuegraphic Marketing for a Values-Driven World by David Allison View book on Amazon
We Are All the Same Age Now: Valuegraphics, The End of Demographic Stereotypes by David Allison
Tools for Customer Segmentation
Customer Relationship Management (CRM) System
HubSpot: Offers robust segmentation capabilities based on demographics, behavior, and engagement.
Salesforce: Provides advanced segmentation features and can be integrated with various marketing tools.
Data Analysis and Visualization Tools
Google Analytics: Provides insights into website behavior, allowing for segmentation based on demographics, interests, and behavior.
Tableau: Can be used to visualize customer data and identify patterns for segmentation.
Final Thoughts
If segmentation sounds like a lot of work, it's because it is. It takes time and in-depth evaluation to understand each group thoroughly so you can market to them effectively. If you’re looking to improve your marketing or segmentation, Emerald Strategic Marketing has a proven track record with businesses like yours. We are a B2B marketing agency that actually cares about its clients' success. We get to know each client, their goals, and specific needs to provide them with customized marketing solutions to help them reach their goals faster. Want to learn more? Reach out, we’d love to learn about your company! Contact Emerald today!
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