Email has managed to stay one of the strongest digital marketing strategies for small and large businesses. However, just like any digital marketing, it succeeds best when it fosters engagement from its audience. An essential strategy for building email engagement and improving KPIs (key performance indicators) is audience segmentation and creating tailored emails. We’ll explain what exactly email audience segments are and the best strategies for finding and reaching them.
Your email audience is another term for those who receive your emails. This can include your newsletter subscribers as well as those customers who receive notifications about their orders, favorite products, or cart updates. While all your audience shares the commonality of having interest in your business, they’re a diverse collection of individuals. Email audience segmentation splits that audience into segments or groups. It then targets those groups with emails that are more specifically tailored to who they are.
Creating emails that reflect your audience’s different interests or concerns results in emails with much higher engagement rates. In fact, alongside personalization, audience segmentation is the most effective strategy for improving email performance. It doubles open and click rates, halves unsubscribe rates. Plus, email audiences with high segmentation can have up to 3x their ROI (return on investment).
One of the first ways you can begin segmenting your email audience is demographics. These include age, gender, location, and other basic details about that person. This can be extremely useful information because you may provide products or services that email to different demographics. For example, a clothing store may sell products for men and women. That business will likely want to send emails about women’s products to a feminine segment of their audience, and men’s products to a masculine segment. Similarly, if a business is hosting an event in a certain area, it is better to send an email only to those audience members who live nearby and could reasonably attend the event.
Psychographic information is like demographics since it focuses on individual people. However, rather than personal information that reflects what part of the population they are, psychographics focuses on their individual minds. These include their interests, lifestyle, and values. For example, some of your audience may prefer more luxurious or extravagant items while others are more frugal. That could represent their financial situation, but it can also just be indicative of their own tastes. As a result, the prior group may respond better to emails that highlight a product’s elegance and opulence. The latter group may engage better with emails that tell them about deals or value incentives. Alongside their demographics, psychographics plays a key role in how customers choose to purchase products or services, and thus what emails they open and click on. Therefore, they are a useful method to segment your audience for determining how and what you communicate to each.
While demographics and psychographics focus on individuals, firmographics focus on the details of an entire company. These include information like a company’s size, type, structure, industry, location, and more. Firmographic details are especially useful for B2B (business to business) and SAAS (software as a service) businesses since their clients are companies rather than individuals. Just like demographics or psychographics, you can use firmographics to create emails tailored to groups of companies that would be more interested in specific subject matter.
Demographics, psychographics, and firmographics are all excellent for creating audience segments. However, you need this information to use them. Some of these can be gathered when individuals or clients create an account to purchase products or services from your business. Your email marketing service, such as Klaviyo, can also retrieve some of this information from cookies and third-parties like Google to help flesh out demographics and firmographics. However, other information such as psychographics can be more difficult to obtain. For these, a newsletter sign-up form or survey with some incentive (e.g. a small discount or contest entry) can help gather this critical information for effective audience segmentation.
The most useful information you can obtain about your audience is from how they interact with your business’ website, digital storefront, and emails. Behavioral information considers things like purchase history, product/service page visits, as well as email open rates, click-through rates, and even what they click. All of this helps create a more detailed customer profile, allowing you to highly segment your audience and create specifically tailored emails.
Demographics and psychographics help you contextualize members of your audience, but behavioral data helps you truly understand their interest in your business. For example, that same woman who shops at the clothing store may only buy men’s clothes for her partner or family. As a result, she will instead engage more with emails about men’s clothing. Demographic information can tell you what kind of person someone is; it’s behavioral data that will tell you what kind of customer someone is.
While demographics can be sourced from elsewhere, behavioral data will be primarily your responsibility to collect. Thankfully again your email marketing service, like Klaviyo, will make that possible. These services will record detailed performance metrics about emails and each audience member. They’ll know exactly who opened emails and where they clicked. These email marketing services can also be connected to your website to help track their behavior there. This could include purchases, product following, and even page visits to get a full picture of every customer.
Collecting data is just the first step. After you’ve assembled these details about your audience, you or an expert in email marketing will then need to analyze the data to create effective email segmentation. Some of those segments will be based on specific product or service groups. Others will be based on their purchase history or email engagement rates. Lapsing customers or email subscribers can be placed into a segment that tries to regain their attention and engagement. Those who are consistently engaged and/or are in a high spending tier might be put into a VIP segment with emails that provide special offers, keeping them loyal to and engaged with your business. This can even be attached to a loyalty program that helps identify and automatically rewards such VIPs.
Now younhave the essentials for understanding email audience segments and why they’re so effective at building better engagement. It can seem like a lot of effort, but it more than pays off in boosting your emails’ KPIs and ROI. If you want to know more about email audience segments, how to create them, or the best strategies for tailoring emails to them, be sure to chat with our digital marketing team.