Audience Segmentation Guide: Types and Steps
Updated June 24, 2022
Audience segmentation is a marketing strategy that divides a company’s target audience into smaller segments in order to deliver more tailored messaging and strengthen connections. It is a key part of audience analysis and can help businesses create marketing content that is less generic and more engaging for a larger customer base.
In this article, we discuss what audience segmentation is and why it matters, share common audience segment types and explain how to implement an effective audience segmentation strategy.
What is audience segmentation?
Audience segmentation is a marketing tactic that categorizes your audience into subgroups based on shared needs, values, characteristics or behaviors. Segmentation recognizes that different groups will respond differently to social and behavior change communication messages and interventions. A variety of tools for search engine marketing, social media marketing and other channels can make audience segmentation easier for marketers.
Why is audience segmentation important?
Companies may resist audience segmentation because they don’t want to leave out any customers, and thus try to make their content appealing to everyone. This can often result in marketing materials that are flat and generic and may end up appealing to even less people.
Audience segmentation avoids mediocrity because it makes your marketing efforts more personalized. When marketing departments match their marketing efforts to relevant subgroups of their audience, they can:
Raise retention rates of existing customers
Build stronger relationships with new and existing customers and earn their loyalty
Create a customer-first mentality
Distinguish their marketing efforts from competitors
Gain new sales leads
Improve conversion rates
Types of audience segmentation (with examples)
Here are some ways you can segment members of your audience:
Demographics describe the outward-facing attributes of a person and can include age, ethnicity, income level, job type and geographic location. This is one of the most common methods for audience segmentation, likely because it is easier to gather and categorize your audience compared to some other methods. Demographic data can be captured using consumer polls and multiple-choice surveys, as well as by monitoring social media accounts and websites.
Example: One type of geographic segmentation strategy is to approach customers during the time of year they’re most likely to need your product. A nationwide air conditioning company may be able to reach their customers who live in hotter states for longer periods of time versus their customers who live in climates with milder summers.
Segmenting your audience by behavioral patterns can help you optimize the best time or method for connecting with those customers. Analyzing shared behaviors to segment your audience means looking at:
Which items or services customers buy
What motivates them to make a purchase
How often they buy online
When they shop, such as seasonally or before holidays
Example: If you notice a segment of your audience that regularly engages with your business before a major holiday, reach out to that group in the weeks leading up to major holidays. If another segment of your audience makes purchases on a monthly basis, then you might benefit more from contacting that group throughout the year on a regular schedule.
Stage in a buyer's journey
Customers at different stages of the buyer's journey may benefit from different marketing strategies. The stages of a buyer's journey typically include awareness, consideration and decision. A buyer at the beginning of their journey is usually looking to fix an existing problem, while toward the end of their journey, they already know what to buy and are ready to make a choice.
Example: Customers at the consideration stage might engage more with content that highlights detailed information on relevant features. As an example, if your company makes electronics, consider sending this audience segment more detailed information about your products or current customer reviews.
Level of engagement
Regular customers might benefit from a different marketing approach than infrequent customers. Marketers can determine a customer's engagement level by looking at several factors such as:
Subscriptions to your newsletter or social media
Sharing reviews or feedback online
People who regularly engage with your brand may prefer to receive more detailed content such as loyalty programs or insider knowledge on your newest products. Customers who engage less frequently might benefit more from content that emphasizes the value of your products or the best features.
Example: A monthly food subscription service sends out a win-back email campaign to entice past customers who have paused or canceled their subscriptions with a discount code or new offerings.
You may notice that some of your potential customers are more likely to look at your content on their mobile devices. A customer's preferred device matters because desktop browsers display websites differently than mobile browsers. Mobile device users might get frustrated more quickly if they find that certain buttons or functions are too challenging to access on their smaller screens, so it's best to optimize your website based on what type of device a customer is using to view it.
Example: Customers who interact with your brand primarily through mobile devices may engage mostly with shorter emails, social media posts and other condensed content. Creating an audience segment for this group would then allow you to target them with more compact content.
Psychographics is a marketing strategy that analyzes a user's online behaviors to get inside their heads and guess their emotions, values, interests, goals, wants and personality traits. Knowing a customer's psychographics can help marketers highlight the qualities of their products or services that matter most to that audience segment.
Example: If you discover a segment of your audience enjoys comedy films and TV, consider targeting those customers with humorous content. As another example, if you learn that a segment of your audience enjoys traveling, you could emphasize how your product or service reduces costs so they can spend more on vacations.
Many marketing teams find that they have the most success when they combine multiple audience segmentation strategies. It is possible to combine two or more of the above audience segmentation methods. Combining different types of audience segmentation can allow you to further personalize your marketing content to various groups.
Example: If you discover that most of your clients who are business managers visit your content on their desktop browsers, then you could create an audience segment based on both this demographic information and device preference.
How to complete audience segmentation
Here are some steps for creating an effective audience segmentation strategy:
1. Create detailed audience segments
Audience segmentation helps you market better to specific groups within your audience. With no or limited audience segmentation, businesses may find it challenging to address the individual needs of customers.
However, the opposite is also a potential concern. If you create audience segments with criteria that is too specific, then only a small percentage of your customers might fit into that group.
Let your company's customer data guide your audience segmentation. For example, if 1% of your customers are people in a rural location and 70% are people in a big city, it is a better use of your time to focus on the 70% who live in cities. Ideally, you can then find a more useful way to segment your customers who live in rural areas, such as if you notice they are most motivated to make purchases in the spring.
2. Set and measure goals
Setting measurable marketing goals helps you to see if your audience segmentation is effective. While one of your goals is likely to engage your customers more, it's difficult to know if or when you have achieved that goal because its parameters and aim are vague. Your marketing department should create goals that can measure if their audience segmentation tactics are working. Here are some sample goals:
Increase product or service sales by 30%
Add 200 followers on social media
Raise your ad click-through rates by 60%
Gain 40 customer reviews
Improve conversion rates by 15%
3. Use and optimize different channels
Experiment with how different channels affect the engagement level of your various audience segments. Channels used to communicate with your audience might include:
Social media platforms
Track how each of your audience segments interacts with these channels. You might find, for example, that your customers who are more introverted prefer email marketing, while customers who are more extroverted typically engage through social media. With this knowledge, you could then customize your future email and social media marketing efforts to these two different audience segments.
4. Be willing to try new tactics and make changes as needed
Sometimes, the particular method used to create your audience segmentation might not work. Your current audience segments might also work for a few months before changing. Your business's audience segmentation may take a few tries to get the most effective results, and some businesses find their customer profiles continually shift.
If your audience segmentation is not working as effectively as you had expected, be willing to change the segment criteria or method. Look over your customer data again and see if you can create new or altered subgroups of your customers.
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