If you’ve read this column before you know how much we stress the importance of developing an in house list of your customers and prospects for the purpose of email communication. By now, we hope many of you have been gathering information on your customers and prospects and are ready to begin utilizing the list. There are 4 main elements that impact the response of online direct response campaigns.

In each of the 4 articles in
this series we will be looking at each element in detail, trying to better
understand how they impact our email campaigns. In part 1 we will examine which
many believe to be the most important element of the 4, right customers
segments.

Right Customer Segments

Customers can be segmented through numerous categories; Double Click’s
“Power of Smart Marketing” outlined seven. The seven customer segments that
were outlined in this white paper were: transactional, behavioral, intent,
demographic, user declared, geographic and environmental.

DoublClick’s
“Power of Smart Marketing”



We will take a quick look at how each
of these segments can affect your email marketing success.

Transactional



Every database marketer understands the
principles of RFM (Recency, Frequency, Monetary) and how important it is to
locate your most recent customers, as they will account the majority of your new
business. That’s right the most recent customers are your best prospects for
new business. Transaction segmentation allows marketers to aggressively target
those customers that have the highest propensity to re-order, your most recent
customer.

Behavioral



One of the many advantages web-marketing
holds is the ability to track. There are methods and ways of tracking
traditional media, but not with the accuracy and detail that online marketing
allows. Effective tracking will provide the opportunity to segment your
customers by their behavior. Amazon is the absolute king in segmenting their
customers by behavior. For those who have purchased on Amazon in the past you
already know what I mean. Amazon tracks everything that you view on their site
and they store this in a database to allow them to provide you links in the
future to other products your behavior has indicated you may be interested in.
Looking to increase your Average Order Value? Then Behavioral Segmentation is a
great way to start.

Intent



When looking at the features users want to see on an ecommerce site, one of
the top three you consistently see is a search box. Users are impatient and do
not want to sift through 10 levels of category listing. Capitalizing on the
users impatience is a must when segmenting your customers. Let’ suppose a
travel site has just received word from the Airlines that all flights to Florida
will be half off in September. If this travel site has the ability to segment by
Intent, they would be able to compile a list of all the customers that have
searched for “Florida” or “Disney World” in the last 30 days. Can you
imagine the conversion rate that list will realize?

Demographic, User Declared and Geographic



The next three segmentations you find on
the list are Demographic, User Declared, and Geographic. These are the three
that most of us utilize when either (a) purchasing a rental list or (b)
marketing to our internal database. These three are also the most
straightforward and the easiest to compile. Most of us are used to giving our
demographic and geographic information out when we opt in for additional
information. User Declared is basically “Why did the user opt in, what are
they interested in”? Let us take a quick look at how Nordstrom.com could use
these three segmentations in a CRM email campaign selling Women’s Fur Coat.
Obviously Nordstrom would select Women (unless it was for the Holidays and they
were targeting the Men for gift ideas), users who have requested information on
coats/jackets and those who live in regions that the weather permits the use of
fur coats.

Environmental



The last customer segment is
Environmental. It is important to understand what type of interface your users
have with the web. An email marketing campaign targeting AOL users would look
much different in terms of creative than one that target users with a program
like Outlook or Eudora. There are many limitations in what an AOL user can see
in the emails opened through AOL. If your customer can’t read your message the
odds are not good that they will be purchasing as a result of your efforts.

The bottom line is that none of
this is possible unless you have the ability to capture, store and sort your
customers. Every site should be implementing this in some way or another. There
are definitely different levels of involvement (both budgetary and the time
needed) but involvement is required if success is sought.

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