Updated April 22, 2022
In our original article, we laid out the case for why audience segmentation should be a part of your marketing strategy. We also gave you some actionable tips on how to use the practice more effectively.
It’s one thing to begin using audience segmentation and another to maximize the benefits you’re getting from the practice. With this update, we’re including three key tips you can begin using today to start getting more out of your audience segmentation strategy.
In the world of digital marketing, being able to reach your target audience is everything. At a broad level, this is a group of consumers that’s most likely to respond to your messaging positively, according to Oberlo. The theory is that if you can create a connection between your brand and this group of consumers, your company will benefit from increased sales.
But your audience isn’t a monolith. It’s full of people and companies with different goals, needs, demographics, and behaviors. That’s why the very best online marketing strategies make use of a technique called audience segmentation. Implementing it into your strategy could lead to promising new opportunities for your company.
If you’re not sure what that is or how to do it, you’ve come to the right place. We’ve put together a guide on audience segmentation that will tell you exactly why your company should be doing it and how to get to where you need to be with it. Continue reading to learn more.
What Is Audience Segmentation, Exactly?
Audience segmentation is an online marketing practice that has to do with target audiences. Its goal is to identify subgroups within the broader target audience to generate new opportunities for a company.
Let’s take a look at how this works in practice. Your target audience may be business travel companies. Audience segmentation would involve looking at this general group and creating more specific subgroups within it.
For instance, you might zero in on business travel companies that cater to a specific demographic. Or you might focus on those who work in a specific geographic area. As you make these distinctions, you’ll be segmenting your audience so that you get more out of your online marketing strategies.
What Does Audience Segmentation Look Like?
The results of audience segmentation will depend on your product and approach, but here are a few examples of how audience segmentation may look.
Location segmentation: If you own a home-improvement retail business, you may target your Colorado audience (NOT your Florida audience) with your new snowblower campaign. You can even microsegment by altering your advertising from city to city or even neighborhood to neighborhood.
Gender segmentation: If you sell weight gain supplements, you might find that your advertising dollars go further when you target exclusively men. On the other hand, a company that operates on a good cause (like donating three pairs of socks for every pair purchased) may sell to more women than men.
Purchasing behavior segmentation: A dollar store should make sure its marketing efforts appeal to comparison shoppers, whereas a luxury makeup brand should emphasize the power and uniqueness of its products (not their value).
Relationship segmentation: If you own a sports goods store, you might exclusively target men with fishing gear campaigns. However, women are responsible for up to 80% of purchasing decisions, so you may have better luck packaging and advertising fishing gear as gifts for husbands and boyfriends.
Why Does Audience Segmentation Matter?
Audience segmentation empowers your company to market its products or services in a more personalized way. Content that’s designed for a more general audience has the potential of feeling stale, generic, and even mediocre. To get the most out of your messaging, you need to use online marketing strategies that allow you to speak to your target audience members in a more direct way.
Audience segmentation achieves this. It allows you to:
- Define your target audience in more practical ways
- Create marketing content that resonates with your audience more powerfully
- Focus on overcoming specific hurdles to your company’s growth
- Build stronger relationships with your customers
- Discover new leads to increase your sales potential
The concept of audience segmentation is tied closely to the idea of consumer personas, according to User Testing. These are mock-ups that reflect the personality, goals, and needs of certain segments of your target audience. Personas can include a ton of information, including someone’s role at work, what they do outside of work, and even what their home life looks like.
Audience segmentation occurs along these fault lines. It breaks apart your target audience based on key persona differences that may impact the type of marketing content a subgroup is most likely to respond to positively.
With that in mind, let’s take a look at some of the most common ways that companies segment audiences to enhance their online marketing strategies.
A demographic refers to a population set that’s distinguishable from others based on factors like age, income level, and geographic location.
For example, imagine you’re an outdoors company selling products directly to consumers. Splitting your audience into demographics based on where they live will have a huge impact on how you market to them.
You might send out messaging focused on winter products to people who live in places where it snows. But that type of content would be inappropriate for consumers living in locations where it’s warm year-round.
Think of demographic segmentation like this: A marketing campaign that piques the interest of a 17-year-old high school student probably won’t appeal to a married 55-year-old war vet. Your product or service may be useful to both demographics, but you’ll have to apply different marketing approaches to catch both of their attention.
Here are the most important demographics that businesses often use for successful audience segmentation:
- Family structure
- Relationship status
- Stage of life
Companies also use behavior as a way to distinguish different subgroups within their broader audience. This can be done in a few ways: You might look at what people buy, the factors that lead them to make a purchase, and how often they tend to buy.
You or your software will consider factors like the audience’s web search history, purchase history, and what the audience tends to avoid. This information can help you compile a detailed audience profile that will affect your marketing efforts.
You wouldn’t necessarily address consumers making small purchases frequently in the same way you’d address those making large purchases sparingly. You might also find that your audience likes to make purchases at a specific time of day or during a specific time of year, and you can invest more in advertising during those periods of time. You might design loyalty programs, happy hour events, surveys, recommendations, or specialty programs for various groups depending on their unique behaviors. All in all, behavioral segmentation can help your sales staff generate new opportunities with the right marketing approach.
Below are some examples of behaviors that you might investigate to better segment your audience.
- Purchasing behavior: What factors have inspired your prospects to make previous purchases? What hurdles have gotten in the way? Is your prospect price-conscious or risk-averse? Do they make purchases based on emotionally or logically persuasive marketing campaigns?
- Desired benefits: Some consumers choose their toothpaste for the flavor, while others seek the best whitening brands. Find out what different clients value the most about your product or service, and tailor your marketing campaigns accordingly.
- Purchase journey stage: Where is your prospect at in their purchasing journey? You can learn more about how close your prospect is to purchasing by analyzing their engagement data over the past few weeks. How many times has the individual interacted with your brand or competitor brands? You can allocate your time and resources based on how much interest each group is showing.
- Timing preferences: When is your customer most likely to make a purchase? Consider national holidays, or more personal occasions like birthdays, vacations, or anniversaries. Target once famously used baby product marketing campaigns on women who had previously purchased pregnancy tests. It is critical to target leads at those times they already intend to spend money on the right investment.
Psychographic segmentation breaks down customer groups based on beliefs, values, social status, opinions, lifestyle, and activities. It’s different from behavioral segmentation because it focuses on the motivation behind a behavior – not the behavior itself. It goes hand-in-hand with demographic segmentation because as demographic data is quantitative, psychographic data is qualitative. For example, here are John’s demographic and psychographic profiles:
|Household income <$50k|
|Lives in the suburbs|
|Enjoys hunting and fishing|
|Enjoys Netflix originals|
|Lacks free time and values efficiency|
|Prefers economical purchases to quality purchases|
With both types of data, you can create a more holistic customer profile and find ways to reach them more effectively. Psychographic segmentation allows you to shift your focus from the features of your product to the customer’s life and how you can improve it. You’ll be able to find out what drives people to use your product and service, and what doesn’t.
Here are a few ways you can use psychographic segmentation:
- Personality – filter personalities with words like introvert, extrovert, creative, and organized. You’ll see there is a correlation between personality type and product preferences.
- Lifestyle – if a person is motivated by healthy living, they are more likely to purchase running shoes or cross-trainers for the gym. If an individual values working as many hours as possible, they are more likely to purchase comfortable orthopedic shoes.
- Social status – people from different social statuses have different motivations – a person of a higher is motivated by brand and quality, while a person of a lower social status is motivated by a combination of price and quality.
Your company’s sales process changes based on how engaged a consumer already is with its products. Someone who buys from you regularly needs a different call to action than someone who’s never made a purchase. For segments that are just learning about your product, the focus should be on forging a greater connection, either emotionally or logically. Keep showing them how your product can make their lives better. Patients who are already highly interested and highly engaged but have yet to make a purchase might need a little push – a limited-time deal or promotion may do the trick. Audience segmentation based on engagement levels uses this fact to help your company improve its sales efforts.
A few engagement level markers you can use include:
- Open rate
- Click rate
- Website engagement
- Spam rate
- Bounce rate
- Email heatmaps
- Content engagement
- Previous purchases
Click rate is a good place to start. For example, you could segment your customers based on how many times they’ve clicked on your emails in the last 30, 60, or 90 days. If you’re using email software, you can update your automatic settings to send emails more or less to various groups.
Learn More About Your Audience’s Engagement With LeadLander
How a User Accessed Your Content
The device that a user employs to access your content can greatly impact the most effective way to market to them. The biggest split that your company should be considering is the one between mobile users and PC users.
A customer who accesses your content with a mobile device won’t have much time to read long-winded blog posts or engage with your emails in a critical way. To reach them effectively, you’ll want to push out short, meaningful posts that convey the essence of your message. If your audience prefers cell phone use, social media may be the right place to target them. According to Statista, the adult population in the United States spent an average of 47 minutes daily on mobile social networking. This number is projected to rise to 53 minutes per day in 2022.
Desktop PC users usually have a bit more time to engage with your content. So you can push out long-form content that explains the benefits of your product or service in more detail. PC users may be office employees, remote employees, or gamers. These little tidbits of information can help you decide where your advertising efforts should go. You might market on LinkedIn, Google search results or gaming websites depending on your product.
To learn more about what content will pique your audience’s interest, you need to know more about your customers’ general passions, pursuits, and preferences. You might be able to divide your audience based on broad or narrow interests.
Some of the signals you can use to determine the interests of your audience include:
- What they post or repost on social media
- Influencers they follow on social media
- Groups or “likes” on social media
You may want to consider hobbies, pastimes, and what occupies your audience’s time on a daily basis. This information is even more useful when paired with demographic profiles.
Consider investing in software that will help you gather this data in minutes, so you can focus on the information at hand and fine-tune or create new marketing campaigns.
Combine Strategies for New Opportunities
It’s worth mentioning that your company doesn’t have to use each of its audience segmentation methods in isolation – combine these methods to create marketing content that’s even more personalized.
Subgroups within your target audience may intersect in more powerful ways than you initially realized. Take, for example, that between 25 and 30% of millennials are mobile-only internet users. Your company might use this to create a marketing strategy that targets a subgroup of millennials who access your content via their mobile devices.
Tips For Bringing Audience Segmentation Into Your Online Marketing Strategy
Audience segmentation is a powerful way to generate new opportunities for your sales staff. If you’re ready to get started, then keep these factors top-of-mind while you prepare for implementation.
Audience segmentation should be an ongoing process
It’s not advisable to merely set-and-forget your segments. Your company should be continuously evolving the segments it targets. The best way to do that is by setting goals and then measuring them. Do you want to reach more people? Gain more subscribers? Improve your email campaigns’ click-through rates?
Set a goal and then measure how well your segments allow you to reach that goal. If you don’t meet the goals, then you may need to revise your segments to better capture the parts of your audience that you’re pursuing.
Don’t be too narrow
It can be tempting to zero in on a specific segment of your target audience – but your company shouldn’t be too narrow in its focus. You still need to target sub-groups that have enough members to make your marketing efforts worth the time and cost they take to produce. Otherwise, you could end up spending more on your online marketing strategies than they return in revenue.
Use multiple channels
Audience segmentation shouldn’t serve as a replacement for a solid multi-channel marketing strategy. Instead, the two should complement one another to reach the sub-groups you’re targeting as effectively as possible. A good multi-channel marketing strategy will include outreach that takes place through:
- Social media platforms, like Twitter and LinkedIn
- Blog posts on your website
- Email marketing campaigns
- YouTube or other socialized video platforms
The data you generate from using multiple channels will also help you further refine how you reach out to your audience segments. For instance, you may discover that the youngest part of your audience responds best to YouTube videos. Your company could use that information to create more personalized marketing content for them.
Use customer journey maps
The best way to understand who your customers are and what they want is to look at their actual web behavior. Creating customer journey maps is one of the most effective ways to do this.
A customer journey map is a diagram that shows the specific steps your customers take between first registering their interest with you and becoming a paying customer.
You can create customer journey maps for each segment of your audience. Use real customer data to inform the maps you create. Then you can begin targeting highly specific opportunities for marketing and sales improvement within each journey map. Miro provides a great customer journey map template.
Offer different benefits to different segments
Keep in mind that your audience segments will often assign different values to the benefits you describe while targeting them.
Let’s imagine you run a grocery delivery company. One segment of your audience might assign the highest value to health. In that case, you would want to emphasize your healthy offerings in the marketing materials you distribute to that segment.
And perhaps mothers make up another segment of your audience. Research from GWI shows that incentives like free delivery and discounts are the most effective purchase drivers for moms. So you would want to emphasize those benefits while targeting this segment.
The key is understanding what each of your segments cares the most about. And to gain that understanding, you will need to collect data and see what types of things have historically resonated most with different segments.
Understand the value potential of each segment you create
As you work to make the most out of each audience segment, it’s important to understand exactly how much value you could extract from each one.
This helps you allocate your limited marketing resources more effectively. You should never spend more than what you can expect to earn from a segment on the marketing. This is especially important if you’re creating multiple small segments instead of a few larger ones.
Let’s continue the grocery delivery example from the previous section. If one of your segments was mothers, you would want to ensure a solid understanding of the total potential value of that market before allocating a percentage of your budget.
For example, maybe the total annual market value of that segment is $100,000. It would be important for you to determine what percentage of that segment you can hope to capture and then allocate your budget accordingly.
Examples of Successful Audience Segmentation
It’s one thing to read about what audience segmentation looks like in the abstract and another to see it executed successfully. That’s why we’re highlighting some of the most instructive examples of the practice in this section.
Lucchese Bootmaker is an excellent case study on successfully segmenting an audience based on known gender. The bootmaker has two versions of its homepage, and the version a visitor views is based on their gender identity – this is deduced by the user’s IP address.
Avocode is an app that enables remote collaboration on design files. It will run an ad that offers a special discount for students returning to school at the beginning of the school year.
This is an excellent example of how you can focus on a specific audience segment with targeted ads. Your company may want to think about using a similar strategy if there’s a need to split its audience by age.
Argos sells consumer products online and segments its audience based on their economic status and serves up targeted advertisements that reflect this segmentation. Argos will often run a payday ad suggesting someone who has just gotten paid should treat themselves – ideal for the nine-to-fiver.
Sometimes it makes sense for a company to target users based on how they’ve interacted with their website. Nomad sends out targeted emails to customers who have added items to their cart but declined to complete their purchase.
These types of emails are great reminders for individuals who got distracted in the middle of placing their orders or need an extra nudge to purchase. Conversely, this wouldn’t be the best fit for those who haven’t visited the site recently.
It’s an excellent example of how your company can use web data (which you can collect with LeadLander) to target super specific segments of your audience based on past behavior.
Pop in a Box
Pop In a Box is a toy and collectible company that segments its audience based on their overall engagement levels. When a known customer hasn’t visited the site in a while, the company will send an email that offers a one-time discount if they return.
This is another example of how you can use website tracking data to create and reach out to more specific sub-groups within your general audience. But to do that, you need a website visitor tracking tool in place.
LeadLander presents your web data in a format that’s easy to understand and act on so you can get more out of your audience segmentation strategy.
Using Audience Segmentation To Create New Products
Identify trends in customer feedback
The first step in this process is identifying trends you see pop up in customer feedback. You might consistently see a specific group of your customers praising one of your product’s features.
This can be a great starting point for designing a new product offering. If you build something around one of your most popular features, the segment of your audience praising that feature will be interested. It also has the added benefit of bringing valuable customers into the decision-making process.
Perform A/B tests
Once you know what to build your new product around, it’s smart to begin performing A/B tests. This gives you the chance to assess the best way to market the new offering.
The concept is straightforward. You essentially create two versions of the same ad with only a few slight differences. Then, you show the ads to the segment you’re targeting with this product and see which one they best respond to.
Performing this type of research will help you assess the optimal way to market your new idea.
Conduct user research
User research is super important when designing a new product. It often isn’t enough to look at data. You want to make sure you’re interviewing members of the segment you’re directly targeting.
Let’s say you’re targeting a segment of B2B customers with a certain amount of annual revenue. You would want to talk to those companies directly to see how they’re using your product and what they value most.
User research should be an ongoing process throughout your product creation. Companies using it tend to end up with products better suited to how end-users interact with them.
Reassess and continue improving
Designing a new product is tough. But if you create offerings built around the desires of your audience segments, you should see a significant demand for them.
The key to this process is ensuring the product you end up creating never strays from your initial vision of appealing to a particular segment.
The way that you do that is to continually reassess and improve throughout the design process. Making this a point of emphasis will help you avoid the need for costly redesigns down the line. It will ensure that the product you end up with is truly the best fit for your target segment.
How to Get Started with Audience Segmentation
Audience segmentation can seem a little overwhelming at first, but you’ll quickly get the hang of it. Here are four easy steps to help you utilize audience segmentation.
- Create audience categories that make sense for your business. Examine your current customers. The goal is to choose specific categories, but not so specific that they only describe tiny percentages of your customer base. For example, if 50% of your clients are working mothers, that becomes a category. If 25% of your customers are stay-at-home moms who live in rural areas, that can also become a category. However, that 1% of single college males may not be a relevant category. Once you have this information, ask yourself – am I catering to each of these unique groups?
- Set specific goals. Naturally, you want to grow your business, but how do you know when you’ve achieved that goal? Set specific milestones for designated time periods, like: We will have 1000 followers on Instagram by April 1, 2023. Determine how you will use audience segmentation to reach your goals.
- Experiment with various channels. There’s only one way to find out how audience segmentation affects each of your sales channels – try it out! Apply audience segmentation tactics on emails, social media, content marketing, etc. For example, send your group of working mothers an email about preserving more time for their children, and the group of stay-at-home mothers an email about preserving a little time for themselves. Track new engagement levels to find out where audience segmentation is making a difference.
- Be flexible. Once you feel comfortable with audience segmentation, continue to evaluate your results and change your approach when needed. Keep in mind that customer subgroups can change over time.
Top audience segmentation tools
Tools make it easier to understand your target audience so you can segment them more effectively. Here are five tools you can use to get more out of your segmentation processes.
Website visitor tracking software
Website visitor tracking software takes the data your website is already generating and puts it into a more intuitive format.
With it, you can learn how different target audience members interact with your site and the various pages. This can help you determine which segments are worth creating and who belongs in those segments.
Social media analytics tools
Social media can be a rich source of data on your target audience, especially if you’ve already built up sizeable followings on Facebook, LinkedIn, and Instagram platforms.
These platforms all have built-in analytics tools, which are pretty effective. But if your company wants to get as much out of social media as possible, it could be worth investing in a tool designed for social media analytics.
These tools give you super in-depth insights into your audience across platforms. This can help you discover new ways to segment your followers.
Your audience segmentation tool doesn’t have to be complex or even cost a thing. Instead, you can gather a ton of information about your users simply by asking them to fill out surveys describing themselves, their shopping preferences, and their purchasing goals.
You can offer an incentive to users who complete your surveys to encourage more people to do so. This might mean a special one-time discount or exclusive access to an upcoming product launch.
Your customer relationship management software (CRM) is another great tool for unlocking a more powerful audience segmentation strategy. If you’re using a CRM, it’s full of data about your customers and leads.
You can use that data to discover insights to understand audience segmentation. Many of the most popular CRMs have this data analytics built-in. If yours does not, look into signing up for a standalone data tool that helps you spot meaningful trends in large amounts of customer data.
Finally, the competition is one of your most valuable research tools for audience segmentation. If you have a direct competitor and understand how they segment their audience, it becomes very easy to see how you should segment your own.
You can get the information you need from the competition to make this determination in several ways: You can look at their website to see the different product categories, or view their social media posts to look at the different features or benefits they offer.
This can be especially fruitful territory if you know that your ideal audience is engaging with another brand at a high level.
Gathering The Info Required For Audience Segmentation
Above all else, you need data to get the most out of audience segmentation. It’s essential that your company track the progress of its initiatives and make adjustments in real-time as needed. It may feel overwhelming to gather enough information just to start segmenting demographics, let alone segmenting your prospects based on behavior or engagement levels.
Fortunately, the right software will make the audience segmentation process painless. One way to do that is by signing up for a service like LeadLander. We help companies improve their online marketing strategies by providing rich data that can be filtered back into your marketing efforts. We’ll tell you who’s visiting your website and give you the information you need to begin segmenting your audience into targetable sub-groups.
But we don’t expect you to just take our word for how effective our platform is at creating new opportunities for your sales staff. Instead, we’re putting our money where our mouth is by offering a free 14-day trial for all new customers.
You can sign up for our free trial today to experience the LeadLander difference yourself.