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The Importance of Audience Segmentation in the Digital Age

The Importance of Audience Segmentation in the Digital Age
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The business environment may be constantly changing, yet one thing always remains the same: the importance of customer satisfaction. And how can you achieve customer satisfaction without audience segmentation?

Did you know that 81% of marketers view customer satisfaction as the main competition area in their industry? 

But, in this digital era, when your business reaches such a broad audience, how do you personalize the customer journey? How do you form strong connections that further lead to customer satisfaction?  

Through audience segmentation. 

Do you want to boost customer satisfaction and engagement? Then, keep reading this article to find out everything you need to know about the segmentation of the audience.

What Is Audience Segmentation?

As the name suggests, segmenting your target audience means dividing it into subgroups based on shared characteristics. 

This marketing strategy enables the delivery of personalized and relevant messages, and, consequently, boosts customer satisfaction and loyalty. 

After all, one of the 21st-century marketing fundamentals is the fact that knowing your customers is no lon​​ger enough. You need to know your customer segment.

Think about it, the effort you put into your content or your campaigns will go to waste if they don’t reach the right audience. Ultimately, digital and content marketing are not a one-size-fits-all.

Therefore, segmenting your audience and creating specific buyer personas will not only help you create a personalized marketing strategy but will also enable you to reach the target market.

The Benefits of Audience Segmentation

In the digital era, your business reaches a wider audience than ever, therefore, audience segmentation has become a necessity rather than an option.

Segmenting your audience and defining your buyer personas may mean going that extra mile, but, as you will see below, the benefits generated will be worth it. 

  • Boosts your email campaigns: Sending personalized emails does not mean adding your subscribers’ names at the beginning or in the subject line. Your subscribers are more likely to read something related to their individual interests. In fact, segmented and tailored campaigns had 14.31% higher open rates than non-segmented campaigns. 
  • Define your loyal customers: When you establish who your customers are, and you build their buyer persona, you understand what type of people to target – the next step stays in getting their loyalty. For example, 40% of Slack’s revenue comes from less than 1% of its customers. 
  • Attract new customers: When you conduct an audience analysis, and you define your existing customer base, you also grasp a better understanding of your high-potential segment.
  • Forget generic messages: Did you know that 80% of consumers are more likely to purchase from a brand that uses personalization techniques? Segmentation is not just about dividing your customers into groups, it’s about targeting those groups with personalized messages. Think about what would you like to hear from a brand and communicate based on the interests of your customers’ base!
  • Increase conversion rate: If you provide your customers with relevant and targeted purchasing information, they are more likely to buy your product or service. And isn’t it the goal, after all? 

Types of Audience Segmentation

To get a 360-view of your customers, you will need different audience segmentation techniques — so let’s dig deeper into those!

1. Demographics

A well-known traditional method of audience segmentation, and also the easiest to conduct. The standard demographics are:

  • Age
  • Gender
  • Education level
  • Marital status 
  • Nationality
  • Geographic location

For example, if your high-potential segment consists of young people (15-22 years), you could create targeted campaigns around the beginning of the school or university year. 

2. Behavior

This type of audience analysis is more complex, as it requires data analysis. However, using the right software will make this segmentation easier.

Through the behavior segmentation, you are essentially analyzing how users interact with your marketing and with your products. For example, you are looking at:

  • What they buy
  • When they buy it
  • How they found your website
  • How often they make purchases
  • How they engage with your emails/social media platforms 

3. Psychographics

Psychographic segmentation is the closest you will come to reading your audience’s mind, yet it is also the most difficult one to conduct. Basically, you are identifying patterns in your data that result in certain emotional responses.

These are the psychographic elements that will help you deliver valuable messages:

  • Sought benefits
  • Values
  • Attitudes, opinions, and beliefs 
  • Personalities 
  • Interests

4. Customer Journey

Prospects need to be targeted with different messages and attitudes depending on what stage of the buyer’s journey they are in.

There are three stages:

  • Awareness: the prospect has identified a pain point and is researching solutions
  • Consideration: the prospect is analyzing options and reading more about products 
  • Decision: the prospect explored all the options and is now deciding on whether to buy a brand’s product or service

For example, reviews or client testimonials could make a great difference in the decision phase, as they provide prospects with social proof.

Your Audience Segmentation Strategy

Your audience analysis is useless without an airtight plan. A well-defined audience segmentation strategy will make the segmentation process easier. 

For example, you will have to revisit your audience segmentation and change it in the future, and a strategy will work as a roadmap.

1. Analyze Existing Data

By conducting an internal analysis, you will also get an insight into your audience’s main motivators, values, and attitudes.

Additionally, analyzing revenues and transactions will make identifying the most profitable segments easier. 

So, explore your existing customers’ current information. Read their reviews and feedback,  look through transactions and revenues data, observe social media and website analytics, and you will gain insight into how your audience interacts with your website and what they think of your products and services.

2. Establish Segmentation Criteria

Observe your audience and identify strong traits that are differentiable from the audience as a whole and could support a subgroup. 

You should also keep in mind that your segment should be substantial enough to be profitable.

Additionally, make sure that the segments you choose have been stable enough over a longer period so that you ensure that it is worth investing in them. 

Based on the segmentation types that we mentioned above, subgroups will need to be targeted through different approaches and with diverse messages.

3. Segment Audiences

You can divide your audience into groups based on the different types of audience segmentation.

Here are some of the methods that you can use:

  • Rule-based segmentation: the criteria are chosen prior to the segmentation and then the audience is divided into groups based on the pre-defined criteria
  • Cluster-based segmentation: observe similarities between visitors and then form groups based on them. Unlike rule-based segmentation, this method is based on authentic similarities rather than hypothetical ones

Once you have segmented your audience, develop buyer personas for each of the segments to get a clearer insight. 

You will essentially create a representation of each of your audience segments. By doing this, you get a more in-depth understanding of who your prospects are as you explore their pain points, hobbies, interests, and more.

4. Act Based on Your Audience Segments

Segmenting your audience is useless if you don’t include your findings in your digital marketing strategy.

  • Personalize emails send personalized emails to your prospects based on where they are in the buyer’s journey
  • Personalize content on your website — divide your website’s content based on your audience segments
  • Adapt your social media platforms to your segments use different social media platforms to target different segments 
  • Personalize advertising – design your campaigns and adverts based on your different segments

Segment Your Audience and Gain an In-Depth Understanding of Who Your Customers Are!

Audience segmentation will help you make sense of the abstract notion of “audience”.  Your prospects and customers will no longer be an amalgam.

Instead, you will divide your audience into subgroups based on shared characteristics. This way, personalizing your campaigns will become easier as you have gained an in-depth understanding of your audience segments.

Are you still figuring out audience segmentation? Or trying to develop strategies based on your findings? Either way, the team at CadenceSEO is here to help you get started. Book a free consultation with us today!

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