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Email marketing is perhaps one of the most talked-of marketing communications tactics on the web and no matter what kind of general guides you will come up with there will be at least couple of people who have already covered them.
However while the majority of email guides and strategy lists are solely dedicated to optimising copy, layout and the offer display in your actual email template, I think there is a gap in the information available on list segmentation and creating campaigns targeted specifically to those lists.
List optimisation
Even though it is fairly obvious I can bet that the majority of you would have one huge chunk of subscribers fitted into one general list which you use as a whole each time you send your regular email campaign.
It’s actually a great example of how marketers/enterpreuners strangely forget basic principles when things are done online. I’m more than sure that nobody would put an ad for a new teenage girl’s perfume in a fishing magazine or use the same communication/offers/incentives/creative to target both men over 50 with 100K income and just-graduated students. In the offline world that would be just utterly stupid. Online, on the other hand, sending one campaign to every single person who left their email any time within the last decade is pretty ordinary. Contradictory weird.
Segmentation ideas
OK, the need to segment your lists is fairly obvious. Now, let’s try to dive into the ways to segment you lists. I think it might be lucrative to break down the segmentation ideas based on type of the site you are running.
Quick disclaimer: please bear in mind that I am talking about websites with clear business goals and monetisation strategies. So if you are running a blog on posterous or blogpost with an audience of your close friends and relatives you are not going to find anything actionable below and a couple more minutes of attention to your campaign would not make a big difference anyway.
Lead generation websites
Perhaps the most easy one. The majority of your list will be the respondents you know by name (your clients, partners, suppliers and competitors) so you have completely no limits.
You should know exactly what topics will be beneficial for every single person, so while sending your usual “company news” campaign you need to make sure you are not bombarding your international clients with UK laws, new office opening news or service offers not relevant/available for them.
If you have grown your list with short-term incentives or any specific tactic make sure the subscribers collected through these methods are separated, as those encouraged to join largely due to an ‘offer’ or gimmick are likely to have reduced motivation to engage with you in the longer term. Then, when you craft a new campaign, you will be able to differentiate you real listeners (those who subscribed because they are interested in you/your company/your service) from those who ‘sold their details’ for an offer and adjust communication and offer types to fit.
E-commerce
In the case of an e-commerce shop you don’t have any excuse – you will always have customers’ past purchase behaviour available, and even if you aren’t focusing on collecting and using all the data available you can, in combination with e-mail address, distinguish who bought what, when and how. This enables you to develop your first three segmentation criterion:
What?: You can clearly segment by product type, colour or price range.
When?: Seasonal vs non seasonal, or you can dive even deeper with segmenting by the special occasions or even date range.
How?: Special Offers, discounts, multiple purchases, up-sell/cross-sell.
Targeting
This is the stage where all of the reasons behind the quite boring and time-consuming segmentation process become obvious. With tightly segmented lists you are opening up a vast number of targeting opportunities in order to boost the majority of your email marketing key performance indicators (KPIs).
Open rate
Subject lines are usually directly correlated with your open rate, meaning that by implementing an appealing subject line you will be able to increase the amount of respondents actually opening your email. With targeted offers and segmented lists you will be able to state that the offer in your campaign is of high interest to the actual respondent based on their preferences and/or behaviour rather than your sales plan. Including this message into the subject line will have a high chance of improving the open rate.
Click-through rate (CTR)
The actual email offer, copy, images and CTAs is what’s going to influence your CTR and targeting gives us a fascinating opportunity to focus on one and only one offer, eliminating all the distraction and simplifying the choice for our respondent. Moreover, with the offer highly targeted to the respondent’s needs and wants, we will maximise not just the chance of the click but the conversion at the end of the process (although only if the landing page is created specifically for the particular offer)
Real-life example
With all the theory above I bet that some of you started to doubt the reality of this approach to list management, but I’m more than happy to share the results of recent test created by us for one of our clients.
Clare Florist is a UK-based flower delivery service sending weekly emails with discounts and special offers. As with the majority of e-commerce sites, before engaging with us they were simply using the entire list without any targeting or segmentation. This still worked well, providing solid results in every single campaign. With a rich number of respondents but without the ability to target them specifically, Clare Florist used multiple offers in the campaign in order to try to satisfy as many prospects as possible. Their usual campaign would look something like this:
Hypothesis
We decided to segment the list into several categories based on the type of flowers purchased by recipients previously and target specific, simplified campaigns based on this segmentation. So for example our list of prospects who have bought roses before will receive this type of the email:
This highly-targeted campaign, in combination with an appealing subject line, resulted in the following improvements:
Test details
Hypothesis: CFEH2
Test Protocol: CFET2
Test Type: Single factorial or A/B Test
Time Period: 28 June–1 July
Primary Goal: To increase the open and click-through rates based on direct targeting.
Results
| Page | Open Rate | CTR | Unsubscribes | Revenue |
| Control | 5.98% | 6.76% | 0.29% | (confidential) |
| Variation | 12.06% | 15.87% | 0.18% | (confidential) |
| Improvement | 201% | 235% | -38% | 448% |
As you can see even obvious changes based on basic targeting have increased the campaign revenue by 448%.
And to finish…
This is the first of hopefully many email optimisation posts to come. Additionally, we are making our email optimisation services available to the general public in a few days so if you are looking for a similar increase do get in touch! Make sure to subscribe to our RSS or start following me on Twitter @Attacat_kiril so you won’t miss it.
Tags: Conversion Rate Optimisation, Email Marketing, The Bigger Picture, Top Rated
Hi Kiril,nnEnjoyed the post. Would love to know your recommendations for list management?nnI’ve used AWeber in the past but didn’t like the import and double opt-in. I currently use Mail Chimp mainly because I like the usability for autoresponders.nnIts probably for another post but do you advocate autoresponders as part of list optimisation and CRO?n
Glad you enjoyed the post.nnI haven’t used the AWeber in ages but definitely remember that double opt-in and seriously strict list import regulations were just over the top.nnWe currently recommend the Mailchimp to majority of the clients but basically only because of integrated social side and subject line testing. As far as i know these features are becoming available by other providers as well so it all ends up on the price difference. Especially, if we are talking about the huge list sizes.nnNot far ago we worked with client using http://www.campaignmonitor.com/. Which overgrown my expectations with fascinating reporting and very valuable integrated email client testing (ability to preview your campaign in all email clients including smartphones is extremely lucrative)nnRegarding the Autoresponders:nnYou are completely right, it’s a subject for an entire blog post if not a series of posts. If in general, always question if every single autoresponder mail is actually providing value to your recipients. Simply because by disappointing the user opening your mail ones you will dramatically decrease the chance of opening your mail next time. Avoid any welcome messages, company news and other spam focused on your organisations needs. On the other hand, if you will be able to include some tasty incentive you might create an additional revenue generating sub-channel. As I said, it depends.
Hi Kiril,nnI think this a brilliant post so thank you for sharing it. I think you’re totally correct that Email Marketing is a massive area that when done well can yield huge results.nnI have to be honest we use Mailchimp for Scottish Business Forums and I have to say i’m guilty of “lumping” everyone in together. This is based on my belief that people who sign up to the newsletter have a genuine interest in small business in general and therefore most of our information tends to focus on this area. I’m now starting to seriously question this!nnYou speak alot in the post about ecommerce and unfortunately we’re not that type of site. I’ve read on countless sites that when you get someone to subscribe to a newsletter you should ask for as little information as possible. In our case we just ask for their email address. However this causes issues with segmentation as you have very little to go on in terms of being able to segment. Am I missing something or is this a common issue?nnBarry
Hi Barry,nnThanks for the compliment – Kiril is out of office so if I may step in…nnYou are completely right that your members will all have a general interest in small businesses but it is also likely that they have a specific interest in a particular area of business – be it accounting, advertising, recruitment etc.nnWith regards to your second point, asking for as little information as possible is the correct way to build your subscriber list. The key is what you do with your list from here. In the case of the post above we used sales data. In your case you may be able to use statistics from your forum software to determine who has an interest in what or which forum members have been most active in certain topics. It all depends on the options you have available to you.nnCertainly the ability to segment will vary by sector, market and company but if you have clear segmentation it will make campaign goals easier to achieve.