E-mail Marketing: Five Segmentation Strategies for More Relevant E-mails

Successful e-mail customer retention efforts depend on delivering relevance through a sophisticated segmentation and targeting strategy, writes Dave Chaffey in his new book, “Total E-mail Marketing: Maximizing Your Results From Integrated E-marketing,” (Butterworth-Heinemann). Chaffey identifies five such segmentation strategies that can be layered on top of one another to achieve effective targeting.

* Customer lifecycle groups: Customers on your site naturally pass through multiple stages as their relationship with you evolves, and each stage can require a different type of communication, Chaffey writes. First time visitors to your site, for instance, might benefit from messages thanking them for stopping by, while customers who’ve purchased one time might need a promotional message to pull them back to purchase more.

* Customer profile characteristics: Because e-mail is such an inexpensive medium to test, Chaffey recommends breaking down your customer list into a variety of demographic groups and testing whether or not each group responds better to specialized messages. Messages segmented by geography or age may provide better results than a single universal e-mail to your entire file.

* Customer behavior in response and purchase: Just as recency, frequency and monetary value (RFM) can provide more valuable segments for catalog mailings, so too can RFM enhance your e-mail campaigns, the Chaffey says. Alternatively, customers can be assigned an activity score based on their responses to older campaigns, with the number of opens, click-throughs or purchases determining how high their scores are, and what type of e-mails each should receive.

* Customer channel preference: Some customers may prefer to interact with your company via catalog no matter how many e-mails you send to them. Identify which channel your customers prefer to use and either provide incentives via e-mail to continue to purchase that way, or use other channels to target these customers, Chaffey suggests.

* Customer tone and style preference: Some of your customers may respond better to messages touting a logical list of the benefits of your products, while others will react more positively to a more emotional, less formal approach, Chaffey writes. Whether you test for this or infer it using customer profile characteristics, he recommends developing different creative styles for separate customer segments.

For a copy of “Total E-mail Marketing: Maximizing Your Results From Integrated E-marketing,” ($39.95), go to http://books.elsevier.com/us//management/us/subindex.asp?maintarget=&isbn=0750680679&country=United+States&srccode=&ref=&subcode=&head=&pdf=&basiccode=&txtSearch=&SearchField=&operator=&order=&community=management