A highly personalized experience is one of the key factors driving customer behavior today. The average buyer expects businesses they’re dealing with, right from behemoths like Amazon and Walmart to the neighborhood grocery store, to understand and preempt their needs and wants.
That’s why personalization has become a focal point not just in business operations but also in marketing initiatives. Given that 74% of consumers feel frustrated if a business’ content – be it ads, promotions, or offers – is not aligned with their interests, personalization is no longer a choice but a necessity.
Even an ROI boosting channel like email marketing cannot deliver optimal results in absence of it. The fact that simply personalizing subject lines can increase your email open rate by up to 26% is a testament to it.
Email list segmentation is the simplest and the most effective – and hence, the most widely used – approach to create targeted campaigns for smaller clusters of target audience rather than taking a one-size-fits-all approach.
A study found that reducing the size of the target group increases the ROI and uplift on email campaigns. By targeting a small cluster of fewer than 150 subscribers, you can achieve an uplift of $1.90 per subscriber. In comparison, the larger target groups with more than 1,500 subscribers give an uplift of $0.50. This nearly four to one difference tells you why segmentation is non-negotiable for creating highly targeted, personalized campaigns.
7 Ways to Slice Your CRM Database for Better Email List Segmentation
Segmenting your email lists means smartly and mindfully dividing your subscribers into smaller groups based on commonalities such as demographics, engagement, industry, and more. This helps create targeted campaigns and optimize the ROI of your email marketing campaigns while reducing costs. Statistics suggest that non-targeted email campaigns cost 3.6 times more than targeted ones.
With a CRM platform at your disposal, segmentation can be a pretty straightforward and uncomplicated process. In fact, if you’re not dividing your database based on CRM insights, you’re underutilizing the potential of your platform.
Change that with these 7 simple yet effective ways to slice your CRM database for pointed email list segmentation:
1. Demographics
If you’re just starting with segmentation, it’s best to begin with the most basic approach – dividing your subscribers as per their demographic information. After all, your customers across the board cannot have the same needs and wants.
Even if you divide them according to location, gender, and age, your email lists will still prove to be far more effective than one giant unsegmented dump of subscribers. This primary level of segmentation can support your personalization efforts by allowing you to offer location- or age-specific product recommendations as well as make subject lines and email content more person-centric.
Once you’re past this stage, it’s important to clearly define your email marketing strategy to be able to break up your lists into more specific sub-sub-categories. For example, if you’re a software business that sells products across industry verticals, you could slice up your CRM database as per the job titles of subscribers to send them relevant recommendations.
2. Sales Funnel
The position of a subscriber in your sales funnel is another crucial point of segmentation. A person who signed up for your newsletter on a whim may be at the top of the sales funnel but wouldn’t be as invested in time-sensitive or special price reduction offers as someone at the bottom.
Similarly, a person who has spent months researching your products and services may not care much about an introductory email offering basic information about your business operations. However, the same information could be of interest to a person who has just discovered you.
That’s why segmenting your CRM database as per the position of your customers in the sales funnel can prove to be an important breakthrough in making sure every user, customer, or subscriber gets information that is relevant to their needs.
3. Purchase Patterns
Patterns such as past purchases, product interests, and buying frequency can all be effective criteria for segmentation. For instance, you can create a segmentation filter for new subscribers and welcome them with an email offering special discounts. Notice how Open Spaces does so in this email:
Likewise, there can be a separate list for people who have purchased from you in the past. Based on their purchase patterns, you can send them product recommendations that are in line with their interests. This Audible email offering more audiobook recommendations right alongside a purchase summary is a perfect example of how ‘purchase history’ can serve as a tool for segmentation.
Your customer database can also be segmented based on buying frequency. You can create special offers or reward programs for your frequent buyers to keep them invested in your business. Case in point: this email by Famous Footwear offering reward cash and a special discount to a ‘Star’ shopper.
At the same time, special discounts or time-sensitive offers can be a great way to nudge customers who have been inactive for a while.
4. Content
Not all your customers will be interested in everything you have to say. So, keeping an eye on how people engage with your content can also become an effective point of segmentation. You could divide email lists based on the kind of emails certain sections of your target audience interact with more.
For instance, people who tend to click on CTAs on new product information emails can be clubbed together in one list while those who engage more with End of Season Sale announcements could make another.
In this too, the CRM database can be further segmented based on seasons. For instance, people who’ve expressed more interest in your spring collection in the past can be clubbed into one list. Those who lean in favor of your fall collection in another.
These content-based customized lists will allow you to make targeted recommendations to buyers in line with their interests and needs.
5. Satisfaction Index
Customer experience is a crucial parameter that most businesses track using satisfaction indexes such as the Net Promoter Score (NPS). But did you know that apart from serving as a measure of satisfaction, these statistics can also serve as criteria for segmentation?
If you’re measuring customer experience numerically, you can segregate customers based on how happy they are with your products and services. Then, create targeted campaigns to optimize your interaction with them.
For instance, you can send emails seeking referrals, reviews, or even upsells to customers with a high NPS score whereas those with lower scores can be wooed with special offers, discounts, or informational emails that help them understand your brand better or use your services/products more effectively.
6. Abandonment
Irrespective of the nature of your business or the type of products/services you offer, you will experience some degree of abandonment issues from your target audience. In the case of eCommerce, for instance, cart abandonment is a sticky issue that continues to eat into the businesses’ bottom line. According to recent statistics, the cart abandonment rate in online shopping averages 69.80%.
Segmenting your customer database based on their abandonment tendencies, and then, creating a well-tailored abandoned cart email strategy is non-negotiable if you run an eCommerce business.
Likewise, websites other than eCommerce stores struggle with form abandonment. A person starts filling out a sign-up or subscription form and then leaves midway. This could happen due to a host of reasons, ranging from your form being too complex to the person’s busy schedule, lack of interest, poor connectivity.
Whatever be the reason, these fence-sitters are leads that you need to nurture. To be able to do so effectively, you need to segment them and woo them with an offer interesting enough to make them want to go back to your website and complete the process.
7. Clicking habits
How your subscribers interact with the clickable call-to-action button in your emails is in some ways the ultimate measure of the success of your marketing initiatives. After all, all that effort, strategizing, and planning boils to this particular action.
So, why not use the insights on your customers’ clicking habits to make your emails more targeted and pointed. Are some of your users more inclined to click on FOMO-inducing CTAs such as ‘hurry, time is running out’, ‘limited period offer’, or ‘try this month’? Do others tend to click on CTAs with clear incentives such as ‘complementary’, ‘discount’, or ‘free’?
Use these clicking habits to segment your email lists to speak to your target audience in a language that resonates best with them.
The Takeaway
By clearly defining your email marketing goals and strategies, you can find endless ways to divide your CRM database into relevant segments and create highly targeted and personalized campaigns!
Need a concrete strategy for segmenting your email lists to meet your marketing goals? Our experts can help you identify the best-suited approach.