How to boost your brand with segmentation and profiling
- Posted: 22nd May 2017
It’s more essential than ever for marketers to target their customer databases based on specific, shared characteristics. The strength of your brand depends on how well you understand your customers – and segmentation and profiling can give you this insight.
Simply put, customer segmentation is the process of dividing your customer base into groups that share certain characteristics. This could refer to a variety of factors, including demographics like age or gender, behavioural indicators like spending habits, or the propensity to complete certain actions such as responding to offers via email and completing online forms. You can read more about this in our blog on propensity modelling. Once your database has been segmented, you can identify the different personas in your audience and target each segment with relevant, personalised marketing communications.
Segmentation and profiling also help you work out who your best prospects are based on certain attributes. That way you can spend most of your time and resources focusing on lucrative opportunities, rather than chasing unprofitable dead-ends. Too many companies don’t make this distinction, and this can result in over-servicing people who return goods regularly or those who tie up the customer service team on the phone for hours. Only by knowing your customers clearly can you prioritise those that add value to your business.
Ironing out the kinks
As great as the benefits are, segmentation and profiling can be tricky to get right. Even the biggest brands, with armies of marketers and specialist agencies, struggle to succeed. A primary problem is that marketing teams often over-generalise customer personas based on their own experiences. Rather than analyse the data without bias, marketers tend to self-reference and create customer segments that feel familiar to them. On top of that, many marketing teams are guilty of basing their profiles and communication campaigns on out-dated, irrelevant data.
To succeed with segmentation and profiling, you need a solid database to build upon. More often than not, company data sits in silos, which is incredibly inefficient. You must be able to pull information from across your entire business – from a single customer view that combines on and offline data from all marketing channels, customer feedback platforms and touch-points. Without this, you will be missing key information when you undertake your segmentation and profiling project. For example, someone might appear to be a lower value customer as they often browse online but don’t purchase. However, the same individual may follow online browsing with regular in-store purchases – but without looking at ways you can recognise offline purchases, you might miss out on this key information.
Superior marketing software
Once you have created your segments and profiles, you’ll want to start creating a plan for talking to them in a more personalised and relevant way. You also need to find an effective campaign management solution. They don’t have to be expensive – even free tools like MailChimp allow you to segment your lists. However, if your needs are more advanced and include say, a cross-channel marketing strategy, then you’ll need something more powerful. An example of a superior marketing software tool is Adobe Campaign. It allows you to communicate offers with your segments across channels, whilst also continuously improving learning by automatically updating with real-time data.
This enables a more detailed view of each customer so marketers can enhance their understanding of each segment and start to utilise predictive propensity modelling. This can predict what each individual customer will buy, when they will buy it and how much they’ll spend over the course of their lifetime. It also helps marketing teams identify the most profitable personas and properly segment them without any bias.
Having the right data, the right strategy and the right solutions will help you provide a far superior customer experience that is personalised for greater impact and delivers real business results.