Email List Segmentation

What is email segmentation?

A segment is a portion of a database that has similar characteristics. Those characteristics are used to market in a relevant manner. Segmenting is vital to ensure that you are getting appropriate information to the appropriate audience.

In traditional marketing segmentation can be difficult and expensive. Most marketers resort to mailing to "segments" defined as people who subscribe to a certain trade magazine or who have ordered from a particular catalog. Most traditional marketers don't even try to segment their "house" lists because it is inefficient to mail in small quantities. However, if someone is receiving mail from you that is inappropriate or not relevant to their connection with your business then you run the very real risk of fatigue and disinterest. You do not want this. Segmenting your list gives you the direct connection to that audience with the information most relevant to them and makes a lot more sense when the delivery vehicle is email.

For small businesses it may still be difficult because you need to spend time analyzing your database and your customers' behavior. This takes time and thus costs money. It is however, a vital piece of the email marketing puzzle.

It has been found that open rates in email campaigns are higher when the list is smaller. In a study done by Morgan Stewart, Director of Strategic Services from ExactTarget, list size was an incredible predictor of both open and click-through response rates. Open and click-through rates were approximately 2.5 times higher for emails sent to fewer than 100 subscribers than for emails sent to 10,000 subscribers or more. *

Consider the following before sending your next email to your list.

1. Which subscribers should receive this message? Identify at least one group that should not receive this message. If you can't, you probably are not protecting your subscribers from irrelevant messages.
2. What information can we leverage to increase the relevance of this message? If you have collected information on the subscriber interests, make sure it's leveraged to drive dynamic content. Use demographic data to determine the right products, message, and offers to deliver.

* Source: Email Marketing by the Numbers by Chris Baggott.