Segmentation as a success factor for mailing campaigns
Advertising must address customers directly. Because one thing is certain – those who identify with the content are particularly motivated to buy. But you can only get the customer’s attention through personalized, relevant content. Generalised mass mailings do not give the customer the feeling that this is about him. The customer expects exclusive offers that are tailored to his interests. In order to reach customers with the right topics at the right time, clear segmentation of the customer base is therefore essential. Only those who know the preferences of their customers and document their buying behaviour in detail can meet this requirement. This is how you build trust in your own brand and strengthen the customer relationship.
Modern technologies already make it possible to collect large amounts of data and make them available for marketing purposes. Although personalised email marketing is an important marketing channel for many companies, the opt-in required by customers often limits the possibilities. Where email marketing reaches its limits, addressed advertising mail can then serve as a further point of contact. For example, sending personalized mailings systematically in segments reduces the probability that the postcard will end up in the trash bin. The opposite is actually true – if this channel is operated in a targeted manner, it represents a very efficient way of reactivating customers, for example. But addressed advertising mail also enables such high conversion rates for other areas of application.
The following criteria should be considered for successful segmentation
In order for segmentation to lead to advertising success, basic criteria must be observed. Grouping customers according to certain characteristics makes it easier to address them with personalized content. Basically, you should always ask yourself these two questions:
“What do I know about my customers” and “How can I use this information for my advertising mail campaigns?
Segmentation according to demographic criteria
Demographic criteria primarily concern the social characteristics of the customer. These include age, gender, marital status and occupation. Gender is a particularly good starting point for personalized mailings, where targeted designs can be used to create special incentives.
You are the operator of an online shop for fashion and want to introduce a summer collection that is aimed at young people in particular. As an advertising measure you are planning a self-mailer with a voucher code of 10% for this collection. Based on your customer data you know how old your customers are and what gender they are. So you create two segments. Group A summarizes all female customers and group B summarizes all male customers of a certain age group. After you have created the segments, you decide on two variants when designing your self-mailer. Variant A represents a young woman in a summer dress and variant B represents a young man in a leather jacket. Both articles are from the summer collection. This differentiation by gender & age increases your conversion rate by up to 70%.
Segmentation by geographical criteria
Geographical criteria include all characteristics related to the place of residence of the customer. In addition to streets and postal codes, the distinction can also be made according to cities and federal states. It is important that clear marketing measures can be derived from the geographical segmentation.
You run a department store for sportswear in the centre of Munich. The summer sales are just around the corner and you want to boost sales with a letter campaign. So you segment your customer base according to the postal codes 80331 to 85540. By omitting the required opt-in, you can address all customers in this postal code area, whereas with email marketing only a small part would be addressable. For the first time, every customer who is eligible because of the geographical proximity is aware of this. This quickly leads to a full parking lot on the day of sale.
Segmentation by interests
Since customers rarely indicate their interests and hobbies when placing an order, this segmentation requires a little tact and sensitivity. However, the customer’s purchasing history provides important clues about their preferences. Whoever shows customers with his advertising that he knows them sends a clear signal. This binds customers and increases their loyalty to the brand.
Your customer’s purchase history shows that they have mainly bought protein shakes and supplements for muscle building. From this you can conclude that fitness issues are a central aspect of his life. To reach him with an upselling campaign, send him a personalised postcard with a voucher code for your own brands in the protein shakes sector. At the same time you know that fitness fans spend a lot of time in the gym and know each other: Referral marketing for this customer segment could be extremely promising.
Segmentation by customer value
The customer’s purchase history provides further information. For example, the value of the customer for the company can be derived from the average shopping basket. However, this segmentation is strongly dependent on the market segment. The high-value customer of an online shop for fashion is usually someone with high shopping baskets and a low return rate. This is another good opportunity for a recommendation campaign.
You want to thank your high value customers for their loyalty. As a thank you, send them a personalised letter with a voucher code. Since you know that these customers have great confidence in your brand, chances are they will recommend you to their friends and acquaintances. So add three more voucher codes for friends and acquaintances to the message “Recommend us”. All of a sudden, postal mailings are not just a tool for customer interaction alone, but also help in the acquisition of new customers.
Segmentation according to buying behaviour
Not every process ends with a purchase. Some customers abort the purchase process with a full shopping cart. Other customers have a high return rate and are therefore in the low-value segment. If you want to use the buying behaviour of every (potential) customer to your advantage, you should follow this closely. A corresponding segmentation for shopping basket dropouts offers high potential for a purchase at this point.
You still want to persuade shopping cart cancelers to buy. Your online shop documents shopping basket cancellations as well as the contents of the cancelled shopping baskets. So you create a segmentation according to these criteria and send personalized incentives for the respective products as maxi-postcards to make the purchase happen after all.
Segmentation according to special occasions
Special occasions include birthdays or anniversaries. If you want to express special appreciation to your customers, congratulate them by name on their birthday. Of course, there is also the opportunity to add additional incentives to the congratulations. This data is not available? Why not simply congratulate them on their name day or on 3 years of “being a customer”?
You know that Mr. Meyer’s birthday is coming up. Since he is a loyal multiple buyer, you want to give him a special treat for his birthday. So you decide on a personalized greeting card with the message “Happy birthday Mr. Meyer” and give him a voucher of 20€ for his next order. Weekly you send these birthday cards automatically to all “top customer birthday children”.
Segmentation by functioning marketing channels
Customers who do not respond to online channels or who cannot be retargeted due to an ad blocker can be approached with postal mailings, for example. But the postal channel is also a profitable addition for customers for whom no email opt-in exists. On the other hand, if customers read every email diligently, it makes sense to continue to send incentives via this channel.
You are planning a reactivation campaign on different channels. Your segmentation shows which customers react to online channels and which do not. Customers that you have assigned to the segment “Non-Online” send a personalized postcard with a voucher code of 20% on their next order. Customers you have assigned to the “Email readers” segment send the same personalized incentive, but this time as an email.
Address customers even more specifically with combined segmentation
“Marketing Champions” go one step further – they combine different segmentations to address their customers with maximum relevant content. For example, those who address the interests of their high-value customers with personalized advertising mail, separately targeting male and female customers, can generate a real competitive advantage. Because it still applies: The more the customer can identify with the content, the greater his motivation to buy.
You run a large online store for fashion. In order to specifically promote the sale of their sportswear, they want to address male and female customers with relevant content. So you combine gender (segment: demographics) with sports (segment: interest) and create a new sub-segment (gender + sports). This segment contains only customers who frequently buy sportswear, separated into male and female. Customers who buy predominantly elegant fashion, for example, fall out of this segment. To address customers of the new segment with relevant content, choose two different postcard designs. Female customers will receive a design showing a woman doing yoga and male customers will be presented with a man doing weightlifting. You also provide the postcards with a voucher code and the message: “Exclusively for you! 20% discount on the next order. That’s how sport is fun.”