8 Questions Segmentation Can Answer
Is my marketing campaign producing results and converting leads?
By tracking visitors to your site by a specific campaign and analyzing purchases from made during that period, you can assess how well you are converting and if you need to tweak your messaging or target market. You may also discover that visitors/prospects need a bit more from the first visit to first purchase.
Segment: Group contacts by date of the first touch, and then look at customer acquisition over X time. You can then see the success of each campaign over time. [In LimeLight you can quickly select “campaign” and “successful order” in the segment dashboard to view this figure over time and identify opportunities].
Who are my most profitable customers?
These are the customers you want to nurture. You can award these customers with perks: free shipping, increased support, maybe even a freebie. Reward them for their loyalty!
Segment: Sort your customers by revenue and select a percentage that you are willing to offer perks to.
Who are my at-risk customers?
What percentage of your customers are churning? If you find that you are leaking customers, you may need to invest in retention – maybe give your lifecycle marketing campaign a boost. Is your content fresh? Does it speak to current customer needs? What type of customers are you losing? New? One time? Loyal?
Segment: Group customers by the time between orders. Identify outliers that are outside the normal range between purchases.
How can I increase my conversions?
There are a variety of different strategies and areas for increasing conversions. A basic strategy is to see if you have a large percentage of email ‘open rates’ but very low conversions. If the answer is yes, it might be time to surprise prospects with special offers or discounts and test the impact on your conversion rate.
Segment: Use your email marketing tool to identify which customers are opening emails but not purchasing.
Do I have a high percentage of shopping cart abandonment?
If you do, you are not alone. The good news is that about 60% of the 4.6 trillion dollars in lost sales due to shopping cart abandonment is recoverable. You’ll want to dig into this and segment by types of customer, cart size, total cart value and product type to develop strategies that align with each segment. For instance, you will want to treat a first-time abandoner different than a repeat customer and if you are finding that abandonment occurs for orders over X amount maybe a free shipping program or discount is to incentivize close.
Segment: Segment out customers by in cart with no sale and add repeat vs. first customer or cart or product size. Treat each differently. [humble brag: LimeLight’s segment tool lets you do this with a simple click of the button].
Is this customer a repeat purchaser?
If this is a repeat customer, are you personalizing messages to them and acknowledging their loyalty? Maybe you can target them with a coupon or discount to share with friends to help spread the word. You could also try A/B testing various offers to different sub-segments and see which works better!
Segment: Sort your customers by revenue and select a percentage that you are willing to offer perks to. You will also need to decide your criteria for what is a frequent customer (x orders per month/year).
Do specific product categories or features keep people coming back?
Optimize your marketing spend and promote the products that sell! Your product team can track which features customers often use and which features are underused to build better products that are more tailored to their needs.
Segment: Find your repeat purchasers, and then segment the purchases by product categories.
What is the ideal pricing for my product(s)?
Some customers are more price sensitive than others. Understand which customers are motivated more by price vs. customers that are motivated by value. That way you can create customized prices for each segment and optimize your profit margin.
Segment: Group customers by demographics (geography, income, education level, occupation, etc.)
Divide and Conquer
Segmentation does not have to be complicated to deliver results. At the most basic level, you have potential customers, active customers, at-risk customers and lapsed customers. As the previous examples point out, strategies for personalizing a stand out customer experience involve a lot of common sense [and a dash of empathy]. View your business from your customer’s vantage point, and you’ll be rewarded with a passionate and loyal customer base.