4 Modern Themes in Segmentation

Digital technology has deepened the portents of the core direct marketing segmentation story, endowing it with multiple subplots and countless possible outcomes. The availability of background and behavioral data is so wide that a growing number of companies are avidly segmenting.

Here, several experts in audience targeting outline four new themes in segmenting.

Segments are everyone’s business—increasingly, even B2B marketers, say author Ruth Stevens and database consultant Bernice Grossman, president of DMRS Group. They recently asked a number of data suppliers to cite which common customer segmentation variables, such as size and industry type, they provide to clients. What Stevens and Grossman found surprised them: Some suppliers provide as many as 100 variables, including details on companies’ installed technology and spending on items like insurance and legal services. “B2B data is richer in segmentation variables than most of us had thought,” Stevens says. “The richness approaches levels B2C marketers are accustomed to.”

Segments are in flux. Digital tracking technology clearly demonstrates that people slosh out of one bucket and into several others, depending on timing, circumstance, or life-cycle maturity. “What you know about someone after 10 or 20 clicks is different from what you know after only one or two,” says Brian Rogers, director of customer success at Evergage, a provider of Web personalization services. “You have to dynamically segment individuals as you learn more about them.”

The more times customers return to websites or respond to emails, the deeper their character profiles become. “Their needs change,” Rogers says. “If you’re not agile enough in your segmentation you may mistakenly deliver the wrong messages. You need to take recent behavior into account, and quickly update your campaigns.”

Segments belie easy metrics. A visitor spends five minutes appraising an item on an e-commerce site, adds it to his cart, and then abandons it. Many marketers will retarget cart abandoners. But this situation is also an opportunity for better segmentation.

“Maybe the shopper is waiting for a better deal, but it’s a mistake not to explore alternatives,” says Justin Premick, director of educational products at AWeber, an email marketing software provider. “Marketers measure success by click rates and open rates, but they make too many assumptions about the reasons behind failed conversions.”

Instead of sending cart-abandoners better deals, marketers should be peppering abandoners with questions via pop-up or email surveys that will reposition them into segments likely to boost conversion rates. “Deeper segmentation can make marketing efforts more productive,” Premick says, “but productivity tends not to be a standard marketing KPI.”

Segments are mobile. Mobile marketing tends to be segment blind. “Marketers have to realize that ‘one size doesn’t fit all’ applies to mobile efforts as much as to their other campaigns,” says Len Shneyder, marketing manager of OtherLevels, which uses A/B testing and other tracking methods to help marketers segment mobile customers. “Sending out as many pushes as possible based solely on geographic preference with no user intelligence is like blasting emails.” Marketers can use location data augmented with personal data provided by customers in app sign-ups, for instance, to ferret out behavioral details that are the building blocks of mobile segments. Where people spend most of their time, Shneyder notes, could clue marketers in to what language consumers speak or how old or affluent they are.

“It’s not a lot different from email marketing,” Shneyder says. “Mobile has a high churn rate, but you can track recency of visits, recency of purchase, and what time zone [customers are] in. Marketers have to start creating segments based on these factors, because it makes no sense to send everybody with a cell phone the same blanket message.”

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