Email marketing—it’s a numbers game. But they have to be the right numbers in the right sequence. Improving email ROI isn’t about simply upping the numbers, getting more names on your list so you can send more email and therefore make more sales.
No, improving email ROI requires increasing the segments you send to, not the grand total number. Instead of increasing your list by 1,000 names per month, segmenting means “increasing” the segments you send to, breaking down your one big list into smaller groups that are more targeted.
Sounds like work, right? But it’s work that’s oh so worth it!
Why you should be segmenting—but probably aren’t
Segmented emails get a higher delivery rate, and more opens and clicks, with fewer bounces, spam complaints and unsubscribes. Take a look at these numbers for proof:
- Segmented emails generate 58% of all revenue.
- Segmented emails can achieve a 760% increase in revenue.
- Segmented, targeted and triggered campaigns generate 77% of all ROI.
Despite all of these potential gains, however, 89% of businesses are not segmenting according to one source—89%! That means only 11% of businesses do segment: Is yours among them?
Marketers can achieve their goals with email segmentation
The irony is, email segmentation helps to boost results as the numbers above prove. But somehow marketers aren’t making the connection between what they want to achieve and how segmenting could help them to do so.
A new research study by Ascend2 shows marketers cited the four goals below as their most important:
- Increase engagement rate (54%)
- Increase customer acquisition (48%)
- Increase email personalization (43%)
- Increase customer retention (42%)
All four of these goals would be easier to achieve with email segmentation.
Goal: Increase engagement rate
When your emails are segmented and therefore targeted, they are more relevant to your audience which increases your audience’s engagement with your email marketing. When we know an email is relevant to us, we are much more likely to open it and—finding that the message does indeed intrigue us—continue on to read it. If it doesn’t, 60% of us will just delete it.
Goal: Increase customer acquisition
It follows that an email that is engaging is more likely to lead to acquiring a customer, especially when that email speaks to that customer’s interests and concerns. Someone receiving a generic email is much less likely to convert vs. someone receiving a targeted, specific and timely message.
Goal: Increase email personalization
Email segmentation is an effective way to personalize! Compare using someone’s first name in an email that’s sent generically to thousands of other people on the same list to an email that doesn’t use your first name but gives you information or offers that are right up your alley. Which email is actually personalized?
Goal: Increase customer retention
And then customers stick around because they know the emails they get from the brand that’s segmenting are relevant and meaningful. They know that brand is listening because the listening shows up in the email marketing. Why would they leave?
Ways to segment emails
Email segmentation can be done in any number of ways, including by gender or by ZIP code or by subscription source, to name a few of the basic ones. From there, email segmentation can get as complex as you want it to be. EmailMonday.com suggests email segmentation can be based on all types of data, including:
- Preferences (the likes and unlikes of a user)
- Demographics and profile (age, location, gender)
- Psychographics (What will they be prone to do and react to?)
- Behavior (purchases, opens, clicks, website browsing, etc.)
For specific ways to segment emails, see the examples presented by Email on Acid in this post. Or just Google it or ask around to find out what others are doing. But remember, only 11% are doing it!
Our advice to you? Become one of the 11%, and increase your email ROI—as well as your competitive advantage!