Segmenting Email Lists for 2012

When ecommerce marketers make their New Year’s resolutions, they should include improved email segmentation and personalization.

Email segmentation is simply the idea of organizing email-marketing lists so that each group of recipients receives a relevant, even personalized, marketing message. It’s the concept of learning something about customer preferences, demographics, desires, and even devices, and then building relevant and authentic customer conversations via email around those preferences, demographics, desires, and devices.

“If you were purchasing television spots for Coors Light Beer, would you choose to have your ads appear on the popular Nick Jr. children’s program Dora The Explorer? … or for Fisher Price toys, or an Ultimate Fighter Championship Cage Match?” asked Curt Keller, CEO and founder of Benchmark Email in a recent opinion article. “Then why as an email marketer are you most likely to just batch and blast precisely the same newsletter to every single subscriber on your list, regardless of age, gender, or previous behavior?”

Keller’s question — why aren’t marketers doing more to segment email lists? — will be particularly relevant in 2012, I believe, because of two specific trends. First, an increasing number of email recipients will be reading emails on mobile devices with dramatically different email client capabilities. Second, improvements in email filtering will make it much easier for recipients to tune out messaging that is not directly aimed at them.

Mobility and Email

“While segmenting an email list by purchasing behaviors, funnel stage and user declared preferences [has] proved successful, Marketers need to continue to listen and look for shifts in consumer lifestyles,” wrote W. Jeffrey Rice, Senior Research Analyst for MarketingSherpa in his company’s 2012 Email Marketing Benchmark Report PDF. “Forty-nine percent of marketers in [the MarketingSherpa] survey said they could not segment their email lists based on viewer device habits. This is significant. In May 2011, Nielsen reported that 38 percent of mobile users own a smartphone, and 55 percent of all new phones purchased were smartphones. With the quick adoption of smartphones, there has been a shift in how people view emails – moving from traditional desktop PCs and laptops, to mobile phones and tablets. We found that on average, 11 percent of email messages are read on mobile devices. ”

Given that one in ten email recipients are reading emails on a mobile device, marketers need to find a way to segment email lists so that they can accurately identify those subscribers. This form of email segmentation may actually be similar to when marketers used to ask subscribers if they wanted a plain text or HTML email. In 2012, marketers could give subscribers the option to get a mobile-optimized version.

Subscribers who expressed a preference for the mobile-optimized version would be segmented and could receive a more relevant message.

For example, imagine an online retailer that was having a sale on computer accessories. Standard desktop subscribers might seen an offer featuring an image of printers or monitors, while those subscribers opted into the mobile version were shown iPad cases and portable chargers.

Filters and Content Overload

A November 2011 survey of 1,001 shoppers aged 13 and older from The Relevancy Group and Stream Send — available here as a PDF — found that 72 percent of respondents had deleted an email marketing message because it was not relevant to them, and 79 percent of recipients age 27-to-32 said that deleting irrelevant emails was a common behavior.

This data supports what most email users know intuitively. Marketing messages get deleted immediately if the subject line or sender is not relevant or interesting.

As alarming as this may be for email marketers — since it indicates that email marketing content needs to become more specific to customer interests — the situation could get worse in 2012. Some email clients, like Gmail, are adding improved filtering that will make it much easier for recipients to simply ignore messages based on content or the time of the year. We addressed email deliverability recently, in “Email Deliverability: Blacklists, ISP Blocks, Spam Triggers.”

The Potential Benefits of Email Segmentation

Email segmentation, even apart from concerns about mobile users or emails being blocked, is one of the best things marketers can do to improve email results.

A 2009 report from MailChimp based on 10,691 separate email campaigns sent to more than 8.7 million recipients indicated that segmenting emails based on job title, customer type, or even zip code could result in a more than 18 percent increase in open rates and a more than 21 percent in clicks.