Segmentation is the foundation of effective email marketing for ecommerce. If you want to deliver meaningful information to your customers, you need to know who they are and what they want. In this article, I’d like to share with you a few ideas on how to segment a contact list for an online business.
Using demographic data to categorize your audience is probably one of the easiest segmentation methods you can find. But, believe it or not, many online stores still don't use it, even though a lot of this data is right in front of them, stored in their CRM.
Demographic data refers to socio-economic customer information such as:
- Other (e.g. children)
You can use demographics to create meaningful email list segments and provide your contacts with personalized content that addresses their needs and preferences. Valuable content translates into higher engagement and business results.
Now think for a moment.
If you were selling running shoes, wouldn’t it make sense to send different content to women and men? Or if you knew that your customers had children, wouldn’t it be great to include – just for them – information about your new back to school campaign?
Doing so is super easy, too.
If you use GetResponse, all you have to do is add that information to your customer profiles and save it as a custom field. Then you can create a custom filter that uses your custom field as a condition.
Pro tip: You can ask website visitors for demographic information at signup. Think of the data you would like to use from the very beginning and create an appropriate signup form.
Not a GetResponse customer yet? Take it for a test drive and start automating your ecommerce campaigns.
You can also divide your email list into segments based on your customers’ activity. In other words, everything your customers either have or haven’t done – whether it’s in your online store or online marketing communication.
Let’s take a look at the most popular segments you could use when selling online.
Subscribers with no purchase
I guess we could assume that this segment consists of people in the consideration or evaluation stage of the customer journey. Your business objective here is clear – drive them towards the purchase.
Remember that at this stage what you offer is content. Create lots of different types of content and use it to discover your audience’s needs and preferences.
How would you like to welcome your first-time customers? Think of the information they need and the way you’d like them to feel after they’ve made their first purchase. The right combination of valuable information and positive emotions is your holy grail.
Don't forget about educational or onboarding campaigns explaining the features of the product or service they’ve bought. Customers who use products to its full potential are usually the most satisfied with it.
Pro tip: You can use the date of the first purchase as a special event and create marketing automation workflow sending an anniversary email.
Top customers (high average order value, high frequency)
I'm sure you have a definition of your top customer. Their average order value is high, they buy from your frequently (e.g., more than once a month), and their customer lifetime value (CLV) is above average. Whatever it is, it’s worth creating such a segment. And here’s why.
Top customers are most probably satisfied customers – they’ve bought from you, and they've been coming back for more. Recognize them and appreciate their loyalty. You can target them with exclusive offers and ask them for feedback. Also, ask them to become your brand advocates and recommend your store to others (offer them something in return as an incentive.)
If they’re high-spenders, you might want to target them with exclusive offers with a higher profit margin.
Recent buyers (made a purchase within the last 30 days)
Target your recent buyers with upselling campaigns offering complimentary or additional products or services to the things they’ve bought.
Recent buyers are also a great source of feedback that helps improve the customer experience. Ask them to review the products they’ve bought and monitor their level of satisfaction with the service you provide. Ask if there are any areas of the customer journey you should improve and do everything you can to enhance the customer experience.
Monitor repeat buyers and figure out why they come back. How often do they purchase? Is there any particular incentive that influences their decision? Find patterns among repeat customers and create even more specific segments. You can dig deeper into purchase data – use purchase frequency and recency to create such segments as e.g.:
- VIP customers
- lapsing VIPs
- regular customers
- lapsed customers
- win-back customers
You can also use purchase history to figure out the categories your customers are most interested in. Then send them an alert whenever you introduce new products to the category.
Customers who bought X times
Why not! If someone has bought from you for the tenth time, it calls for a celebration. There are a lot of ways in which your company can celebrate. For example, you can send an appreciation email with a token for free shipping at the next purchase.
Experiment with segments
Collect data along the customer journey and feel free to experiment with segmentation. As you already know, browsing and purchase history offers a lot of valuable insights. Combined with demographics and CRM, they’ll give you a massive amount of information about your customers.
Here are a few options to get you inspired:
- Total number of orders
- Average number of products per order
- Total number of products ordered
- Most frequently purchased product
- Average amount spent per order
- Number of product reviews
The thing is to recognize your business goals and customer information needs at each step of the loyalty loop and create segments that will prove meaningful in this context.
Let’s do this!
You've read the theory. Now it's time for practice! Save some time this week to create a meaningful segmentation plan. Start with a few basic segments and narrow them down as you get more customer data and more ideas for valuable marketing communication. Good luck!