Audience Segmentation: What it is, How to Use It, and Examples
Today, the way you communicate with your customers is important. They have options, control, and don’t want blanket offers that aren’t related to them. 74 percent of customers feel frustrated when content is not personalized. And another 59 percent say personalization influences shopping behavior.
Delivering the same message to all your prospects, and random different groups, during a marketing campaign only turns them away.
Audience segmentation is a marketing strategy that identifies and targets subgroups within an existing audience. Groups typically share common traits or needs that you can tailor your content to address. The goal of audience segmentation is to deliver personalized messaging and build stronger connections with prospects.
It helps you:
- Refine your messaging to your intended audience.
- Build trust and loyalty with your customers.
- Qualify more leads.
- Increase conversions.
Want to get more site traffic, boost the effectiveness of your marketing campaigns, improve engagement, and sell more? Using audience segmentation will help you make better communication decisions and improve customer satisfaction.
Why is audience segmentation important?
Great question — your answer varies.
Not every marketing asset can be personalized. However, segmenting an audience lets you group them by certain characteristics and sends curated offerings that speak to them, instead of blanket offers that miss the opportunity to connect.
Audience segmentation allows you to focus your efforts on an individual customer type, or specific audience, so you can better cater to their needs. It gives your company an advantage over competitors by showing your customers that you understand them and know them best.
Types of audience segmentation in digital marketing
One of the primary objectives in audience segmentation for a marketing campaign is building rapport with your people. Powerful messages used consistently over time in a channel that appeals specifically to your target audience, like a Messenger text or email, can help you achieve this goal.
To best position your company to work with audience segmentation in digital marketing, you’ll need to understand the four major types. You’ll be investigating different customer personas, deciding on a set of segmentation criteria, creating a plan using audience segmentation, and refining messaging by making improvements to your copy.
Here are the main types of segments to get you, and other marketers, started.
1. Geographic
Geographic segmentation divides customers according to a predefined geographic border. As you might expect, this type of market segmentation covers differences in interests and values throughout various countries, states, and cities, and also cultural preferences, climate, and more.
The goal of geographic segmentation is to:
- Better serve customers in a geographic region.
- Reach custom audiences with more relevant products.
- Improve advertising effectiveness, boost customer engagement, and reduce costs.
- Focus marketing efforts in a defined area of interest.
If you find your response is too low or you haven’t covered marketing or advertising costs, take time to explore the variables. Did you target the right geographic group, or were you selling parkas in Miami? Consider all the possible reasons and polish geographic targeting across your marketing efforts.
2. Demographic
Demographic segmentation refers to any group defined by variables such as age, gender, income level, employment, or race and nationality. It’s a common segmentation strategy because most products are tailored to an individual around some demographic element.
The benefits of segmenting by demographics are:
- Easy-to-use because census data is freely available for most states and countries.
- Simplified targeting as a product is likely impacting people in a select target market.
- Helps develop market outreach for companies exploring new audiences.
Many times marketers make the mistake of thinking demographics are the only purchase driver, but while it counts, it’s not the most important factor. Consumption differs between generations and even similar age groups; for example, a 30-something year old may buy a laptop for completely different reasons than someone in their 50s
So you have to dig deeper into other types of segmentation.
3. Behavioral
Behavioral segmentation speaks to any group defined by behavioral traits including knowledge of, use of, likes and dislikes of, or attitudes toward a brand. Behavioral segmentation highlights the way customers feel and react during the buying process. And this is important given buying decisions are 80% emotional and 20% logical.
The benefits of behavioral segmentation is:
- Discovering customers’ personality, goals, aspirations and ideals to speak with them accurately.
- Improves advertising efforts and provides customer insights by narrowing in on what makes a potential customer, and your intended audience, tick.
- Helps identify customer journey so you can create a strategy for potential customers that resonates on a psychological and emotional level.
For example, brand loyalty is an example of behavioral segmentation. Think about a brand you trust enough where if they send you a promo, you’re going to buy – no matter what the reviews say. This type of behavior reveals different buying patterns and helps you learn how to retain customers and your target audience.
4. Buyers’ journey
Buyers’ journey segmentation has become a commonplace marketing tool that is used to break down customer groups based on three stages: awareness, consideration, and decision.
This category of segmentation helps you:
- Identify specific problems a group experiences throughout their buying process.
- Target specific conversations and content which helps aid buying decisions.
- Understand consumer expectations and purchase patterns to improve retention.
Audience segmentation examples
Do you want to take your segmentation to the next level? Learn from these successful and replicable examples.
Kelly Mirabella
Kelly Mirabella, Founder of Stellar Media Marketing and Baby Got Bot, segments her Messenger subscriber lists, on social media by a variety of traits including gender, interests, and more.
ManyChat Tags help her send more relevant messages, learn more about her customers, and smarten up her social media Messenger bot processes.
Dollar Shave Club
Dollar Shave Club is a great example of segmenting by behavior. The company, known for selling high quality, low price razors expanded its product line to include all shaving necessities like lotions, balms, creams, and more.
To better capture leads, Dollar Shave Club targeted prospects based on website activity. If someone visited the Lotions page, they’d follow up with an email about lotions — similar to abandon cart emails.
RetailApp
Apps are known for tailoring messages based on engagement. For example, RetailApp celebrates customer anniversaries with a special discount:
Customer retention is based on how loyal consumers are to your product or service, and the more you show existing customers you value them, the more loyal they’ll be to your brand. Offering special discounts like the above is a common strategy to create brand loyalty in consumers.
Seasonal stores
Seasonal products like bathing suits and ski supplies are marketed to different geographic segments at different times. In areas like the Midwest and Northern U.S., retailers promote winter gear a few months before the fall. Whereas in areas like California, you’ll find swimwear and sunglasses advertised all year round.
Level up your marketing strategy with audience segmentation
You’ve spent time and money creating the best marketing strategy for your company. You want your messaging to resonate with potential customers and loyal fans. But how can you achieve this? By segmenting your audience and focusing your efforts on their wants and needs.
To improve your targeting efforts and keep your messaging relevant, use the guide above to create or better your audience segments.