Different needs, different conversations – ‘one size fits all approach’ never work with digital marketing. Personalization is what is driving businesses forward in today’s digital commerce landscape. To optimize the personalized experience for every customer that visits your e-commerce website, customer segmentation comes in as an effective strategy.
Segmenting Your Audience: The Benefits
Audience segmentation or customer segmentation is simply another way of optimizing your marketing communication as per different clusters of customers. These clusters or groups can be created as per demographics, geography, preferences, interests, online activities or other shared attributes. What benefits does customer segmentation hold for your business you ask?
The reasons are listed below;
Discovering New Needs & Problems to Solve
If your e-commerce marketing team develops a routine to analyze new customer segments, they will come across numerous patterns and problems that their new segments audience shares. Discovering these problems first hand and addressing them can open up a new market for the business to capitalize on.
Dividing your target audience as per their individual preferences can yield better returns for a given campaign. For instance, if your marketing team segments customers based on who did or did not buy from your annual online sale, they can create two different email marketing campaigns. The email intended for the ‘cold’ audience can churn out additional revenue with personalized messaging.
Engage Broader Audience
The best part about implementing customer segmentation into your marketing is that you can either go super targeting or broadcast broader yet relevant messaging for the best results. For instance, a new product launch campaign can cover all your audience segments – new subscribers to premium customers with unified messaging.
The above benefits of audience segmentation are promising for every growing digital retail brand. That brings us to the highlight of this blog –
6 Powerful Customer Segmentation Statistics That Every Marketer Must Know!
77% ROI through Email Marketing
It is an astonishing fact that as high as 77% of the returns generated through email marketing come from audience segmentation, targeted, and triggered campaigns. Driving your SMS and email marketing campaigns for the segmented audience can boost your overall ROI for any given campaign.
- Segment your customers based on emails with unopened, opened, and clicked status. Then draft personalized communication for them with an appropriate CTA.
- Automate your communication for email & SMS with marketing automation tools like Wigzo.
46% Higher Email Open Rate, 27% Increased Click-Through Rate
This is not news for a handful of businesses who already know the power of e-commerce customer segmentation, and have already automated their marketing. Digital retail brands that broadcast personalized promotional emails experience a 46 percent higher email open-rate and a 27 percent higher click-through rate than regular marketing emails.
Achieve 3-5% More Sales
A report released by Mckinsey clearly stated the upsides of running promotions for a segmented audience. As per its report, retail brands can score 3-5% more sales through campaigns tailored to different audience segments. In fact, if you map customer behavior and their past engagement patterns on your e-commerce site, you can better optimize your messaging & offers.
- Tweak pricing as per the audience segmentation. For instance, a ‘clicked but not purchased segment’ and ‘product browsed but exited’ audience segments might be price sensitive. This will yield some more sales.
80% Customers Expect a Personalized Brand Experience
A recent survey by Epsilon regarding e-commerce customer segmentation and personalization revealed that 80 percent of the customers are more likely to buy from a brand that tailors the experience for them. Out of the sample size of 1000 consumers aged 18-64, 90 percent of the respondents agreed that they liked a personalized brand experience.
- Develop a personalized marketing & promotional communication for your e-commerce brand to capture a lot more customers – and convert them!
Experience More Impulse Purchases
The ultimate reason to implement audience segmentation is to drive deeper personalized engagement for your customers. This brings with it another wave of big benefits – increased impulsive product purchases. This report on personalization reveals that at least 49 percent of their sample respondents agreed to buy a product impulsively when they came across a personalized offer.
- Leverage your ‘cold’ and ‘hot’ audience alike with personalized offers and drive more impulse purchases with effective audience segmentation.
51% of Customers Expect Brands to Make the First Move
It might sound counterintuitive, considering how many people are seriously concerned about not being contacted for sales. However, statistics suggest that 51 percent of them want retail brands to anticipate their needs and contact them with a suitable offer. And, in case you still choose to go the traditional way, mind that 63 percent of the consumers get annoyed with generic offers from digital retail brands. So, personalization now becomes a need, not an option!
- Make a switch from multichannel marketing to omnichannel marketing to give better value to your customers, and scale.
So, the above-mentioned are some useful customer segmentation statistics for you to act upon. Stay tuned for more weekly blogs on e-commerce marketing automation and omnichannel marketing strategies.