How to Segment your Email Database, and Why you Need to

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Is your email database a one-size-doesn’t-fit-all approach? If your database has 5000 email addresses or more, segmenting your audience will help get the best results from your campaigns.

A large audience is likely to have different wants and needs, so it is important to target your communications to get the best possible click-through and conversion rates from your e-newsletters. This month, we’re talking through ways to segment your audience for successful email marketing.

How to Begin Segmenting your Email Database: Buyers and Enquirers

If you’re new to segmenting your database, the best place to start is to divide your audience into two groups: those who have bought from you in the past, and those that haven’t. These segments are known as ‘buyers’ and ‘enquirers’.

With these two categories, email messages can be tailored to appeal to each group. The first group can be tempted back for further spending, the second should be enticed to make their first purchase. Current customers need less incentivising than ‘warm leads’, so this differentiation is important for the success of your email campaign.

The Next Step: Buyer Habits

The next way to slice your database is by examining the habits of customers who have bought from your business in the past. To do this, we use three factors: Frequency, Recency, and Monetary. Let’s look at each of these in turn and examine the ways they can help to deliver the most attractive, relevant messages to readers.

First, Recency – Define your database by how recently customers have made a purchase. For those who haven’t bought for a year, it’s time to coax them back, perhaps with an offer.

Secondly, Frequency – Examine how regularly the contacts on your email list place an order: this will influence the way you market to them. For example, a customer who purchases 3-4 times per year needs little incentivisation. Those customers who buy only once a year would benefit from an email message encouraging them to spend more frequently.

Lastly, Monetary – look at the basket value of purchases. For customers who spend only £10-£20 at each transaction, use your e-newsletter to convince them to spend £50.

More Ways to Slice Your Email List

Of course, there are even more ways to segment your marketing database. The larger your database, the more options there are to create an effective strategy.

Split your Database by Product Category

Brands with multiple product categories have two opportunities:

Firstly, encourage customers to buy again from a particular collection. This is an easy win, because you already know they are interested in these products.

Secondly, broaden the variety of categories from which a customer purchases. Aim for product collections that are complementary rather than entirely different, because sending the wrong message can have a negative effect.

Slice by Demographic

Another alternative is to segment by demographic. Although this seems straightforward, segmenting your audience in this way should be done with caution. For instance, it might seem obvious that a clothing brand should target by gender, but this approach can carry risks. Women often buy for the men in their lives, so failing to share menswear communications with the women on your database could cause you to lose out on sales.

Segment by Location

Geographic segmentation is also worth considering, particularly if you have both an online and bricks-and-mortar presence. Slicing by location allows you to highlight in-store activities and local events without sending irrelevant communications to an audience that is geographically remote.

Explore all the Options

Remember to try several different options to ensure customers get the best experience from your brand. The more relevant your email content, the more likely your readers are to continue opening your emails and the better your click-through rates will be.

How to Test the Effectiveness of Email Campaigns

As with all digital marketing, analysing results will ensure your communications are meeting your goals.

New Messaging

When trying a new strategy or message, target a specific segment of your database to receive it.

For example, if your database has 20k email addresses, select a particular 5k to receive your new communication. Meanwhile, send your regular communication to another 5k, selected at random from the remaining subscribers.

Evaluate the results to discover which email proves the most popular. Which e-newsletter had a higher open rate? How many clicked through to your site?

Encourage Enquirers to Become Buyers

Use a similar testing method to encourage enquirers to become buyers. Target a sample group of enquirers with a particular message, and compare against your usual unsegmented, untargeted communication.

Compare Conversion Rates for Special Offers

Test which promotion gives the best conversion rate: 5k email addresses receive an offer for free delivery, another 5k are given a code for 10% off. Analyse the results and roll out the most popular offer to the rest of your database.

Make every E-newsletter count

Segmenting and testing are crucial in discovering which communications appeal to your target audience. The more customers feel you are talking directly to them, the more they will engage and buy, and the more effective your messaging becomes.

Without segmenting, your e-newsletters may be irrelevant to large sections of your audience, causing them to disengage with your brand. Ineffective communications are a waste of time, money, and effort.

For an expert hand on your email marketing campaigns, contact us  at Coleman Hammond to discover how our email marketing services will get your audience engaged.

Kerry x

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