What is Segmentation?
Segmentation is the process of dividing a large group of people into smaller, more specific groups by certain data such as buying behaviour, demographics, geographic and interests. Segmenting your mailing list allows you to speak more intelligently with your prospects and customers as you are able to create a more defined and meaningful message to match your customer’s exact needs. If you nail your segments, your prospects will receive relevant direct mail packed with information they want to read. Ultimately, an effective segmented mailing list is key for securing better open rates and higher conversions for your direct mail campaign.
The United States Postal Service found that around 75% of households usually read or scan some of their direct mail marketing materials. This is said to be due to the sophistication of direct mail today; the improvements in collecting relevant consumer data, browsing behaviour modelling and increase in personalised direct mail services.
This blog details 5 different ways to segment your mailing list effectively.
Geographic Segmentation
Geographic segmentation is based on where your customers are located. Depending on whether you want to target local, national or international prospects, segmenting your mailing list geographically will allow you to hone in on certain areas and places. It is very important you have all of the correct address information for your prospects before you send out your mail.
Demographic Segmentation
In order to connect with your customers on a more personal and relevant level you should be dividing your list into specific groups using demographic data and typical characteristics which include gender, age, ethnicity, household income and occupation. By doing so you are able customise your list and promote your product or service with a much more targeted approach. For example, you may choose to use lots of images and graphics over bulky text in your direct mail campaign which may resonate much more with a younger audience.
Firmographic Segmentation
Firmographic Data is a set of characteristics that are specifically related to firms or companies that group together to form different market segments. Very similarly, the way you would use demographic data to segment your prospects, you would use firmographic data to categorise the companies you are wanting to send your mail out to. Understanding the needs of the types of business you want to target is particularly important for choosing the correct message you want to send to companies that will benefit most from your products or services.
Psychographic Segmentation
Psychographic segmentation is the process of combining together the psychological and demographic traits of your audience to ensure a much better understanding of their needs and wants. Looking closely at some psychological traits such as unique attitudes, personalities, interests and behaviours allows you to use a more specific message for your segmented groups. This is particularly beneficial for the types of companies who offer specialised offers or products that don’t always appeal to a large group of people. For instance, a company specialising in selling climbing equipment might target climbing enthusiasts (Psychographics) between the ages of 25-40 (demographics) with a special offer for discounted climbing harnesses, rather than targeting a general population.
Sales Stage Segmentation
Sales Stage Segmentation is effectively the status of where your customer is currently at in the sales pipeline and their buying journey. This type of segmentation is also useful to look at whether your customers are active, or inactive buyers. The 5 stages of Sales Stage Segmentation include the following:
- Awareness– Prospect becomes aware they have a problem.
- Consideration– Prospect begins gathering information about possible solutions.
- Evaluation– Prospect begins evaluating different companies and their proposed solutions.
- Purchase– Prospect becomes a customer.
- Post-Purchase– Customer becomes a brand advocate.
This type of segmentation is particularly beneficial for businesses to prompt or pass on a friendly reminder for their customers or prospects to take action, especially if they are currently inactive. Companies that collect a vast amount data on their customers and prospects can easily implement this type of segmentation into their strategy and means they can consistently keep tabs on where their customers are at in their buying journeys.
How Will You Segment Your Mailing List?
By strategically segmenting your mailing list, no matter which type of segmentation you use, can help you reach a more qualified and direct audience so you can get the most out of your direct mail campaign. By splitting your list into smaller and more intentional groups based on their preferences and needs can benefit any direct mail campaign. Ultimately, segmenting your mailing list will ensure a more targeted approach with specific tailored messaging which will help to boost engagement, maximise on your conversions and increase your overall ROI.
If you would like to discuss your next direct mail campaign, contact us today for a free no obligation quotation. For more information, please use our contact form or call us on 020 8492 5858 and one of our mailing specialists will be in touch soon.