How to Upgrade Your Email Segmentation Strategy

Any marketer worth their salt knows that different messages and different tactics influence different people. No single ad will ever speak to every portion of the population. 

Then why do marketers continue to apply that thinking to their email strategy?

Email segmentation is about personalization, and it’s what we’re talking about today.

What is email segmentation?

Email marketing platform Campaign Monitor defines email segmentation thus:

Email segmentation is the division of email subscribers into smaller segments based on set criteria… [and] is used as a personalization tactic to deliver more relevant email marketing to subscribers based on their geographic location, interests, purchase history, and much more.

Essentially, it’s about dividing your email list into smaller segments based on the behavior and engagement levels of those people, and then delivering information that each list is more likely to find helpful. 

Your business will find it helpful too.

58% of all revenue

Why does email segmentation matter?

Because it works.

Instapage did some research into digital personalization (you can read our piece on personalizing your ecommerce website here) and gathered 68 powerful findings. Here are the most tantalizing ones when it comes to email segmentation:

  • Segmented, targeted, and personalized emails generate 58% of all revenue
  • Segmented personalized automated email messages average 46% higher open rates than normal marketing messages
  • 82% of marketers have reported an increase in open rates through email personalization
  • 75% of marketers believe personalization yields higher click-through rates

Now, we know what you’re thinking: “Personalization isn’t the same as segmentation.”

And you’re right, dear reader, but email segmentation is the necessary first step to email personalization; without the one, the other is pretty damn difficult.

All those wonderful stats up there lead us to another one: the ability to segment email lists is the most effective personalization tactic for 51% of marketing influencers respectively.

Did you hear that? THE most effective personalization tactic.

That’s why email segmentation matters.

static versus dynamic email segmentation

The difference between static and dynamic email segmentation

Before we dive too deep, let’s discuss a basic aspect of email segmentation: static lists vs. dynamic segments.

Static lists don’t change. You segment them once and they stay that way, regardless of your contacts’ subsequent behaviours. 

Dynamic segments don’t rely on manual manipulation to stay up to date. When new data is acquired, it will be automatically assigned to the appropriate contact, who, in turn and if need be, will be reassigned to a different, more appropriate segment.

Bottom line is dynamic trumps static in every regard, allowing you to always deliver relevant content to your contacts.

Email segmentation tools

Marketing automation tools are ubiquitous these days; everyone and their granny is knee-deep in the automation game. But, as with everything else, not all tools are created equal.

When it comes to email segmentation, you need to find the one that answers your needs.

MailChimp has market share. It’s been around since 2001 and is the first company out of anyone’s lips when you ask them to name an email service provider.

And they’ve earned that distinction. It’s user-friendly and a great entry point for businesses that are just getting started with email marketing. But email segmentation is not their forté. Not even close.

To understand just how basic MailChimp’s email segmentation capabilities are, you need to look at an all-star ESP like Klaviyo.

Gael Breton from Authority Hacker has done us all a favour by compiling an in-depth comparison between the two that touches on everything from price to usability to analytics and, of course, segmentation.

For the purpose of our conversation, here’s what it boils down to:

  • When you sign up with Klaviyo, you’re presented with a range of possible lists you can build out using imported contacts from your email list; no such luck with MailChimp
  • Segmenting abilities with Klaviyo allow you to get extremely deep: you can divide contacts based on behavioral or transactional data like those, as Breton puts it, “who looked at sunglasses 5 times in the last 6 days on your store, or people named Bob who bought pants last Wednesday”; with MailChimp, there’s no deep dive, no specific behavior tracking, and definitely no Facebook audience integration (another thing Klaviyo offers)
  • You can also set up Klaviyo’s “data science” tools and use those to figure out which customers are probably going to become your VIP shoppers; MailChimp is over here like, “VIP shoppers?”

Breton wraps up his analysis of the two ESPs’ email segmentation capabilities by saying that “Klaviyo puts MailChimp’s segmentation to shame from start to finish. It’s more in-depth, easier to use, and frankly more exciting too. MailChimp barely competes. For really in-depth and scientific segmentation Klaviyo is the ultimate offering.”

Note: Klaviyo did not give us one red cent to say these things and promote Breton’s piece. It’s just the facts.

Remove inactives

Having inactive contacts in your lists is like being in a bad relationship: you don’t want them and they don’t want you, and sticking together will only make both of you miserable. Cut them loose, and move on.

The only thing you need to decide is whether you cull that contact after 60, 90, or 180 days of them not engaging with your marketing efforts. But regardless, make a choice, stick to it, and watch your marketing team thank you for it.

Keep your lists clean. Especially when you’re paying and ESP for the number of contacts you have.

Email segmentation thrives on personas

Marketing plans depend on buyer personas. You identify your target and tailor your efforts accordingly. Simple stuff.

Email segmentation is no different: your lists need to be based on personas. 

Market segmentation is based on four categories:

  • Demographics
    • Age; Gender; Income; Education; Social status; Family; Occupation; Life stage
  • Psychographics
    • Lifestyle; AIO: Activity, Interests, Opinions; Values; Attitudes; Personality; Concerns
  • Geographics
    • Country; City; Language; Urban vs Rural; Population/Density
  • Behaviors
    • Usage; Intent; Benefits sought; Buyer stage; Occasion; Purchase history; Engagement; User status

When you segment based on the above, you’ll be able to define those customers who are most likely to become VIPs, those who will buy infrequently but over a long period, and those who engage but rarely purchase. 

And then you’ll be able to communicate with them appropriately.

Personas: it’s not just a strange word.

Restock your engaged lists

You can and should also build segments based on open and click rates within certain time periods: 30 days, 60 days, 90 days, 180 days.

Every chart we’ve ever seen with this data shows us that open and click rates are highest right off the hop and drop off as the time goes on.

In other words, if your customer hasn’t opened your email or clicked through after 30 days, the likelihood that they will after 60 days is small, and even smaller still after 90 days. By the time the six-month mark rolls around, even the crickets have gone home.

What you have to do is revitalize. Re-engage those sleepyheads by targeting them directly. Make it clear that they haven’t been around and that you miss them.

This type of personalized messaging works wonders when it comes to luring them back into the fold and reminding them why they signed up in the first place.

sync email database

Synch and swim

Marketing systems are at their best when they have as much (accurate) data as possible. So give it to them.

Synch your ecommerce website to your ESP so it can collect and use data from your visitors, data like…

  • Pages they visit
  • Products they click
  • Products they add to cart
  • Products they abandon in cart
  • Products they buy and when they buy them (time of day, time of week, time of year)
  • If they return products
  • How long they browse

You already collect this data and use it to personalize your site and improve your users’ experience, it only makes sense to share it with your email automation tool.

Help it help you.

Time for emails!

There have been countless studies on the best day of the week and time of the day to send your marketing emails, but the unsatisfying truth is that each company’s audience is slightly different, and when they respond best to emails will be different too.

One thing we can say is that, if you have contacts that span different time zones, make sure to segment them by the one in which they live. 

Say you know that you achieve the best open rate when you send your emails at 1 pm. It will do you no good if you apply that across the board; if you have contacts on the other side of the world, they’ll be receiving your spectacular message in the middle of the night.

Make sure you segment by time zone.

Measure and optimize

We’ve said this before somewhere (oh that’s right, in our 10 Easy Ways to Speed Up Your Ecommerce Website article) but it holds true here too.

Email segmentation is not a set-it-and-forget-it concept. If you aren’t learning from it, you might as well not do it in the first place.

Key metrics to measure:

  • Open rates
  • Click rates
  • Unsubscribes
  • Average revenue per email

As with every other aspect of your ecommerce business, you need to be analyzing how your customers behave at every touchpoint. Measure, identify trends, and pivot accordingly.

Email segmentation might sound like a big job, but it’s not. With the right tool (and a can-do attitude!), dividing your contact lists into groups of people who are looking for the same type of content is not only easy to do, but crucial to your online business’s success.

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