Most of the companies have understood the importance of email marketing and they are using different email marketing strategies to stay in the field. Segmentation and Open sending are two of the most employed strategies in email campaigns.
Open sending involves sending the marketing emails to everyone in the email database. This is one of the easiest techniques, which has been in vogue for a long time.
In contrast, Segmentation is focusing on specific target base of customers and sending mails only to them instead of sending to the entire database. This is one of the best techniques to improve email-marketing campaign.
Is segmentation better than open-sending? When does segmentation benefit you more than open-sending, and the other way round? Which is best for your campaign? These are some questions we attempt to answer in the analysis below.
Why Segmentation matters?
Segmentation means dividing the customer base to different groups and tailoring the content in the emails as per the specific group’s preferences.
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All customers are not same
Segmentation is important as all customers are not alike. Each one will have different preferences and different set of expectations. They will open the email only when the content is relevant to them. Sometimes, a general email with a broad message might not be effective for all groups of customers. Segmenting can be done by understanding the buyer personas.
Different customers – different sales cycles
Your customers might be at different stages of sales cycle. For example, a passive customer would just read the email that interests his business, a customer who is looking to do business with you would enquire or ask for a quote for a product in the email, or a customer who is already doing business with you might want to know about maintenance of product. Some customers are very near to make a decision on purchasing the product, while some might be just enquiring and some might have already ordered once.
So, email communication specific to their sales cycle is important in this case.
More engagement/ Open rate
When our email communication is specific to a certain group, there are high chances for the customers in that group to open and read the email. More engagement implies the content is more appealing to the target group of customers.
Great revenue and lower unsubscribe rates
Segmenting the customers properly will give better results by improving revenue. Since content in the email is tailored as per specific group’s needs/ expectations, unsubscribe rates reduce.
Other benefits include greater customer retention and low spam complaints.
Segmentation Vs Send to All
An Advantage of Open sending is that email communication is received to all subscribers and open rates might be high compared to segmentation. But, there is also a risk of losing an important customer if they feel, content is not relevant to them. As we send irrelevant material to people we find that people will stop responding to their own mails, also may be driven to a point of irritation when they mark the mail as spam. This will have negative effects on domain reputation. Segmentation always yields better open rates and thus better return of investment (ROI).
One good way to improve segmentation base is to include ‘update preferences’ link in each email sent out. Thus, we can categorize our customers as per their preferences.
Conclusion:
Segmentation is not very easy. There are many challenges. Understanding user personas and different sales cycle stages is the beginning and then, there are endless possibilities to categorize customers. More time need to be spent on creating content for each set of customers. Tailoring the content to suit each target group is time-consuming. But, because of high open rate, better deliverability and greater revenue, segmentation is here to stay, in spite of all the challenges.