Email List Segmentation is one of the modern marketing techniques that allow companies to pander to their target customers. Companies with their products and services use this effective email marketing method in multiple domains. A brief discussion on the different aspects of Email Segmentation has been done below for you to understand how important it might be for a company.
What is Email List Segmentation
In its simplest form, email segmentation is defined as a technique that allows companies to break down their email list into multiple smaller lists. This segmentation is done based on the customer base and types of services required by the recipients. Email list creation is not a new concept and has been followed for a long time by organizations to promote their product. Email segmentation has taken the purpose of email list creation to a new level by identifying different types of audiences and categorizing them based on their specific interest.
Several approaches used for email segmentation will be discussed later, which have provided promising results to the companies in terms of better sales and revenue generation. The approaches used for this process depend upon the company and might vary for different domains. The method that works for one company might fail in the other, so choosing the segmentation method carefully is important.
Email list segmentation consists of some mandatory steps, such as collecting and storing a complete database of potential customers and permanent customers of the company. It also includes analyzing the interests of the customers based on which the categorization of the different lists is done. It is important to have in-depth information about the organization and the different domains in which it works to ensure that it can match the customers' interests with the respective domain for better target marketing.
If the company fulfills all the above-mentioned requirements, then it is ready to implement email list segmentation using any of the approaches as per the requirements of the business. The further steps might change according to the data that has been collected or the categorization that has to be done.
Why Segmentation is Required
Before going forward with how email list segmentation is implemented in companies and whether it is automated or manual, it is important to understand why it must be done. Some primary reasons companies introduce email list segmentation are mentioned below.
Diverse Market or Potential Customer Base
One of the main reasons it is important to categorize your email list is the diversity of customers in the market you plan to tap. It is impossible to ponder such a varied set of people with a single approach, and hence, it is important to pander to every interest differently.
Categorizing the customers as per their needs and matching them with the different services you provide can help in pandering to different types of customers with more conviction. Email marketing segmentation can help target individual groups and send emails to their particular interest. This will not only enhance the brand awareness of the potential customers but also their conversion rate.
Different Interactions with the Customer
The way any potential customer gets to know about your brand will always vary. It can be a blog, social media, friend, paid advertisement, etc. With different sources of information, the perception of the customer about the company can also be different. This perception can also be different based on when the customer first learned about your company. Email marketing segmentation helps your brand reach out to all the perceptions differently and convince them to do business with you.
Increasing Email Reputation
Suppose you can send the exact email that your target audience needs after categorizing them according to their interests and preferences. In that case, it will ultimately create a good image of your communication process. Email list segmentation will help enhance your email reputation by giving the customers exactly what they need. This helps expand your business as an organization with a good overall market reputation.
Challenges Faced in Email Marketing
To understand the need for email list segmentation more, here are certain challenges faced in email marketing that need to be addressed by this process.
Increase in Engagement Rate: Certain companies send the same type of email to their entire customer base as there is no segmentation done. This means there might be many people with zero interest in the content or the product provided in the email. This ultimately results in lower engagement which is bad for organizational growth. This slows down the company's growth and might lead to some loyal customers unsubscribing to the services because the content is not in their interest.
Customer Retention: Customer retention is the process of retaining the customer who has bought any service or product from a company, in order to make them a loyal customer. Sending emails about all the services the company provides as the major content of the mail sent to them can make them lose interest and they might never come back. A common approach to resolve this issue is to provide offers to new customers for a few more purchases. There are many companies that use personalized and interactive content to engage their new customer, and you must also do the same. This requires a lot of resources and time but can have extraordinary results in terms of ROI.
Data Integration: Data is the backbone of your business, and it is very important to integrate the data received from the emails you send in a systematic manner to avoid redundancy and anomalies. This practice gets even more important for large-scale brands as the amount of data they receive on a daily basis is humongous. Using different data integration tools can be a good approach to resolving this challenge. These are automation tools that will help divide the data into different categories so that it can be used accordingly, and the analysis of data can also be significantly easier than the analysis of congested or unintegrated data.
How is Email List Segmentation Used?
As discussed in the previous sections as well, target marketing is one of the major applications of email marketing. It helps target a specific group of contacts from the market and sends them emails about their interests, convincing them to work with the brand. Following are some of the main applications of email marketing in target marketing.
Using Email Marketing Segmentation for B2B Clients
If you own or work at a B2B company that needs more clients to do business with you, then email list segmentation is an effective method to make your B2B site effective. To reach out to different companies, it is important to communicate with them so that they understand and take an interest. This language can be different for different companies, so sending specific emails to companies with similar interests and preferences is important. This will also show these companies that you have done your research before contacting them that can work to your benefit.
Creating a Specific Customer Base
Email list segmentation is not a process that only benefits a company once when it is applied. If implemented properly, this method can also be very effective for future client data. Categorizing the customer base will help put all the new customers in a specific category so that, as per the marketing trends, that category can be targeted for better sales.
For example, if the segmentation of the emails is done based on region, then if there is an event in a particular region, then that region can be targeted, and emails can be sent related to the event to engage potential customers. Creating a categorized customer base will also help create new ideas for the business as per most interests.
Approaches Used for Email List Segmentation
There are different ways in which the segmentation of the email list is done.
Following are some of the top approaches that are used in the market for categorizing customer data.
Segmentation by Geographic Area
This is one of the most commonly used Email List segmentation approaches in which the categorization of the customer data is done based on their demographic region. This categorization helps target customers of a particular country and provides them with email content per the latest trends there. For example, if a country wins a major sports tournament, a targeted email can be sent to them congratulating them about the same and asking them to do business with you. The same email cannot be sent to any other country, making email list segmentation even more important.
Segmentation by Surveys
In this effective method of email list segmentation, a group of customers is asked to take a survey. The group's categorization for sending emails is based on the answers they gave to the survey. The survey helps the companies understand the customers' interests, so targeted emails are sent to them according to their answers.
Another similar approach that is used for dividing the customer base is creating a quiz for the customers. The answers to the quiz also tell a lot about their interest, and it is a quiz, instead of a survey, that gets the attention of the person it is sent to. This interactive quiz captures valuable insights about customer interests and engages individuals more effectively than traditional surveys, increasing the likelihood of a response. By tailoring the questions to specific preferences, businesses can further refine their marketing strategies and deliver more personalized experiences.
Segmentation by Demographics
This approach involves categorization based on gender, income level, age, etc. This helps target an even more specific crowd for better reach of the services using minimum resources. People of different demographics can have different interests and preferences in their life. For example, a woman of 27 would want different products than a man of 52. Hence, segmentation of email lists based on demographics can be really helpful as combining some of the information can help create an even more specific group that can be targeted when needed.
Benefits of Email List Segmentation
In the past few years, there have been many ways in which email marketing segmentation has helped companies in terms of growth and revenue. Following are some of the major benefits of the same.
Creating Relevant Content for Marketing
Creating a specific list of users and customers helps create reachable content with targeting information. Content like this helps rank the webpage above and, hence, is good for the brand's overall marketing. In terms of email marketing, if you know the customer's exact preferences, you will make the content specific to their needs instead of creating a generic mail for all the customers simultaneously.
Analyzing a customer's behavior, history, and choices will help you create content rich with information. The content of an email sent to a regular customer cannot be the same as that of an email sent to a new customer. Creating a specific email list will help differentiate the information to be sent in both emails and, hence, create relevant marketing content.
Decreases Unsubscribe Rate
One of the major reasons people unsubscribe to email services is that they lose interest in the emails that are sent to them. This is because, for some customers, there is no or minimum content for their needs, ultimately resulting in them unsubscribing. Email list segmentation helps create a group of people with similar interests and send them emails accordingly. This means that all the emails that are being sent to them are of interest, and hence, the probability of them unsubscribing is significantly decreased. Giving the customers what they need will also help maintain a good reputation for your company.
Improves Customer Retention Rate
Sending the customers what they exactly need helps increase customer retention and make them regular customers of your brand, and the same can be done with email list segmentation. Sending targeted emails to specific groups of customers provides them with the content and products of their interest. If a customer purchases a product from you and you add them to your email list, then sending the targeted content will surely help them return to you for more products. This will only be possible if the content sent to them in the email is highly specific to their interest.
Increase in Click-through Rates
Once the customers start reading the emails you send to them, they are more likely to click on the links and products it consists of if the email is directed towards them. Pandering to the specific interest of the customer by email list segmentation helps convince the customer to visit the brand website. It might ultimately increase the company's overall sales.
Increased Open Rates
New companies often ignore this aspect, which is highly important because customers will not even want to open the email from their inbox if it is not addressed. Email segmentation helps create the email subjects so that the reader is engaged with the mail, which most emails cannot do. 35% of total emails are left unread by the customer, and email segmenting helps you get out of this number.
Conclusion
Email List Segmentation is one of the most widely used automation techniques all around the globe due to its amazing results in terms of customer retention and revenue generation. A few challenges make email marketing a bit difficult, but implementing email segmentation can do wonders for your company's growth.
Creating a healthy customer base and dividing it into a list per their needs will always help understand the customer's behavior and help the company make future decisions. Implement email list segmentation in your business today and enjoy its amazing benefits, such as lower unsubscribe rates and more relevant marketing content.
