Segment to maximize your marketing dollars
When you divide your customers into different groups you are able to communicate more effectively with them. You can divide customers in a logical process that leads to groups that are homogeneous and that will likely react in the same way to your marketing message.
The division can be based on:
Once you create segments, you are able to customize your message so that it is more relevant to the segment. For example, your message to new customers would be quite different from customers who've made several purchases. Or your message to an elderly person would be different than the one addressed to a teenager.
The more relevant your message to segments, the more customers will feel you are speaking to "them" and the likelier they will "listen" to your message.
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When starting out, do you segment into multiple lists or segment on one critria and then segment again? How detailed is too detailed?
When segmenting a customer base, the first criteria to use is the one that drives the message you're sending. For example, if you sold men's and women's clothing, you'd first segment by gender. The second segmentation can be done by segmenting based on behavior - in this case, segment based on what link customers clicked on (all those who clicked on outerwear get an outerwear email).
You should segment until the effort maintains a population that can support the cost (time and money) that subsequent emails provide. If the return does not cover the time and money, then you know to stop segmenting.