There’s a reason email marketing is one of the top marketing tools for converting leads. Sure, social media can help you spread your message far and wide, but what other platform allows you to speak to your audience on a personal level?

Okay, okay—when you’re list is in the hundreds of thousands, you’re not really holding a personal conversation. But that’s not the point. The point is that with the right segmentation strategy, your customers will feel like you’re talking directly to them. They’ll feel understood. They’ll feel important. And then they’ll take action.

Did you know that at any given point you have:

  • A 60 to 70 percent chance of successfully selling again to a current customer
  • A 20 to 40 percent chance of winning back an ex-customer
  • A 5 to 20 percent chance of turning a prospect into a customer

If you’re smart about it, segmenting your email marketing lists has an overwhelmingly positive impact on the engagement of your subscribers. The Lyris Annual Email Optimizer Report showed that 39 percent of businesses that segmented their email lists increased open rates as a result. In fact, not only did open and click rates go up, but abuse and unsubscribe rates went down.

Did we mention revenue? Segmented campaigns lead to higher real-world conversions. According to DMA, marketers found a 76% increase in email revenue from segmented campaigns.

Of course, finding the right segmentation strategy for your audience is easier said than done. If you’re not quite sure where to start, you are not alone. 52% of marketers admit that their email database segmentation needs work.

The first step is to understand the different types of segmentation:

By Geography: Segmentation by geography is a great strategy to employ when the location of a buyer plays a role in his or her decision to take action. It’s a great strategy for special events, sales within a specific region, and more. It can also help you stagger your emails by time zone to send out at optimum times.

By Demographics: Different genders and age groups will react diversely to varying content. Segmenting your list by age, gender, income, life stage, and occupation can ensure you’re delivering relevant content to the right people.

By Content: To segment based on your audience’s personal interests, take a look at the content that members of your audience have viewed, clicked on, or downloaded. Most email platforms will allow you to segment for people who have downloaded a whitepaper, so why not follow up with more information?

By Psychographics: Building buyer personas and understanding the values and motivators of your audience is an advanced way to cater to their needs through social media. Though it’s a bit trickier, you can get detailed information about subscribers’ personal interests by creating user profiles on your website or asking your audience to identify preferences with CTAs in your emails.

By Behavior: Your audience’s behavior will depend heavily on where they are in the buying cycle and how familiar they are with your offerings. If you’re using analytics to help track your audience, you can leverage this information to determine how close your customers are to making a purchase—and even what that purchase is most likely to be.

By Engagement Level: One of the most important segmentation strategies is to reward your loyal customers and brand advocates. Whether that’s frequent buyers or people who take the time to read your newsletters, customer loyalty should be nurtured. You can use segmentation to send thank yous, private offers, and feedback requests.

Once you’ve implemented the tools to segment your audience and established your desired strategy, the next step is developing a targeted campaign to engage them. That means developing the right message, offer, design, and voice to drive conversions.

Segmentation Case Study: Ivan Smith

Here’s a real life example of segmentation in action. Our client Ivan Smith Furniture wanted to message their in-house finance customers. That’s a small niche to begin with, but they took it one level further, understanding that this audience had two major groups.

The first group held the Ivan Smith credit card, and the next group consisted of buy-here/pay-here customers. Email Broadcast created a different message for each segment telling them the good news: “Due to your excellent credit history with us, you’re approved to buy more furniture, and here’s a special offer.” These two emails combined were sent to only 7.8% of Ivan Smith’s email list, but the results were outstanding.

The credit card holding audience had a 37% higher than normal open rate and the buy-here/pay-here segment showed an 85% higher than normal open rate and a 50% higher than normal click through rate.

But that’s nothing compared to the business results of these two messages which combined for $400,000 in new sales in a single weekend. Worth doing? You can bet that Ivan Smith Furniture believes in the power of sending targeted messages to a segmented audience.