Digital marketers the world over never stop talking about the importance of building your email list.
However, what’s more important is understanding how to effectively utilize that list in order to maximise conversion and generate the highest possible ROI.
When it comes to small businesses who sell products or services online, one of the best ways to get the most out of your mailing list is through email segmentation.
In this article, we'll be explaining exactly what email segmentation is and outlining some different strategies for including email segmentation in your next campaign.
What Is Email Segmentation?
Before jumping into our favorite strategies, let's take a look at what email segmentation is and why it should be added to your digital marketing toolbox.
Segmentation is exactly what it says on the tin - it’s the process of segmenting your email list based on a range of different factors in order to make your email campaigns more targeted and effective.
According to Orbelo, you can expect to earn $32 for every $1 you spend on email marketing campaigns. However, through the use of effective email segmentation strategies, this ROI can be significantly increased.
By collecting information from your email subscribers beyond the point of capture, you can customize your email campaigns to ensure you only show them relevant information.
You can segment your list based on demographic information, location data or the ways in which visitors interact with your website, i.e the the pages or products they view.
You may be thinking that analysing all that data may seem like a lot of work but the truth is email segmentation is quite simple. You probably already have a lot of the information you need to get started and even basic segmentation can be really useful to your business.
Why Is Email Segmentation Helpful?
By separating your list into smaller groups, you can send out emails that are more targeted to specific groups and increase the open and click-through rates of your emails.
According to MailChimp, email marketing campaigns that utilize segmentation produce:
- 14.37% increase in open rates
- 64.87% increase in click-through rates
- 8.98% decrease in unsubscribe rates
Gathering information about your subscribers isn’t just useful from an email marketing perspective, either.
Knowing more about the people interacting with your website can also help you to make more informed decisions about your business and products.
Now that we’ve covered the importance of email segmentation, let’s talk about some actionable ways you can do it. Here are 5 email segmentation strategies that you can use to make the most of your next campaign.
One of the simplest and most effective ways to start the segmentation process is by dividing your email list by demographic data.
In order to stand the best chance of segmenting your list effectively, you should try to gather as many relevant personal details as possible from subscribers during the sign-up process.
You don't need to ask them their dog's name or their grandma's favorite TV show, but you might want to try to gather the important stuff like their age and gender.
In addition to this, you may also choose to ask questions about their occupation, homeowner status and even their income.
What questions you decide to include in your sign-up sheet will depend on what type of business you’re running.
For example, as much as you may want to know how much expendable cash your subscribers have to spend, questions like this may come across as invasive unless your site offers financial products or advice.
You don't want to scare people off by asking questions that seem unrelated to your business as they may assume that you plan to share their personal details with third-parties.
It's also a good idea to avoid asking too many questions as this can be overwhelming and it may discourage people from signing up at all.
1-3 demographic questions about things that will be specifically useful to your business should do the trick.
Your email marketing platform of choice should give you the option of customizing your sign-up questions, and you should also be able to add opt-in buttons for different types of marketing emails such as offers and sales.
Purchase History Segmentation
Another easy way to segment your email list is based on past purchases. What's great about this strategy is that you don't have to pry into your customer's personal life in order to get the required data — you already have it.
What was previously just a bunch of numbers sitting there doing nothing could be the difference between a sub-par marketing campaign and a super-effective one.
By using information about what customers have purchased in the past you can make informed decisions about what they might want to buy in the future. This works particularly well for products that might need to be regularly replaced or refilled.
For example, if your website sells cosmetic products, you can time your emails perfectly to peak your customer's interest when their products are about to run out.
Although this may sound a little complicated it's actually quite simple. There are integrations available that will help you to merge your purchase data with most email software. You can then set-up your campaign to automatically email customers at specified intervals after their initial purchase.
Spending History Segmentation
Similar to the purchase history strategy, you can also use data about how much your customers spend to segment your email list. If you have a customer that spent around $10 on your site during a sale, an email about a more expensive product may be completely lost on them.
A lot of customer purchases are completely dictated by their budget and you can use this information to target the right messages to the right people.
This tactic works especially well for brands and businesses that sell products at a range of different price points. Customers with an average lower spending amount should respond better to emails about discounts and sales while bigger spenders are more interested in luxury items and emails about exclusive offers and events.
Just like with the purchase history strategy you can use software to integrate your sales and email marketing software to advertise the right products to the right customers.
Email Engagement Segmentation
This next strategy is really useful as it not only makes the emails you send more effective, it can also help you to save time by eliminating unresponsive contacts from your list altogether.
Although email marketing is one of the most effective ways to reach out to customers, some people simply don't interact with marketing emails at all. In order to use an email engagement approach, you need to separate your list into active and inactive contacts.
An inactive contact is someone that hasn't opened one of your marketing emails for a long period of time. A good timescale to use here is around 3 months.
Then you can choose to focus your marketing campaign solely on active users or you can run a separate email campaign to try and re-engage your inactive contacts.
If you choose to try and re-engage the inactive contacts then it’s a good idea to use some of the other tactics to ensure that your re-engagement efforts are targeted enough to get people opening emails and clicking through.
You could also try making use of personalization techniques such as using their names in the email subject line or preview text. For example email headers like 'John, we miss you' or 'We haven't seen you in a while’.
Alternatively, you can focus on the customers that do interact with your emails and further segment them based on the ways in which they interact. If you segment active users into those that clicked through from sales emails and those that didn't you can send follow up emails encouraging them to take another look at the sale.
Website Behaviour Segmentation
One effective but slightly more complicated way to segment your list is to track website behaviour.
Using tools like BeamPulse you can track everything a visitor does on your site from how long they spend on your page to what they clicked and what videos they watched. By using this information you can send people emails that are specifically related to content that they engaged with on your site and better collaborate with your email partners.
This method can produce some really great results, but compared to some of the other methods it's slightly more difficult as analysing behavior data isn't as easy as other information gathering techniques.
This list is by no means exhaustive but hopefully it’s given you some insight into different ways to get started with email segmentation.
Our advice is to explore the options of your current email software, pick one of the strategies to test, and build out one campaign to start.
The most important thing to remember is to track how well different tactics work for your business and adapt your strategies accordingly. Good luck!