Want to boost the performance of your email marketing campaigns? Email list segmentation could be the answer.
Research from Mailchimp shows that, compared to unsegmented campaigns, segmented lists deliver:
- 14% higher open rates
- 11% more unique opens
- 101% more clicks
As if that wasn’t enough, they also reduce bounces, unsubscribes, and abuse reports.
Sounds good, right?
But you’ll only enjoy those benefits if you nail your segmentation strategies.
Helpfully, that’s exactly what we’ll talk about in this guide!
What is Lead Segmentation?
Lead segmentation is the process of splitting your mailing list into smaller groups — or segments — based on shared characteristics. For example, you might segment lists by location, with one segment for leads based in California and another for New York-based leads.
How Important is Lead Segmentation?
I’ve already noted how creating list segments can improve open rates, unique opens, clicks, bounces, and more.
So lead segmentation is clearly important. But why is it so impactful?
Because segmentation is the key to effective cold email personalization. By building email segments of leads with similar qualities, you can write more relevant content that speaks to the specific challenges and goals of each segment.
For instance, you might sell a product that appeals to organizations of all sizes. But a one-person startup will have very different pain points and needs to a multinational enterprise, so it might make sense to build separate email segments based on company size.
How To Use A Segmented List
On the face of things, building segmented lists and running segmented email campaigns is a simple process. It works like this:
- Segment your current email list into multiple groups, creating a separate CSV for each group
- Craft email content personalized to each of your list segments
- Upload the CSVs into your email automation tool of choice
- Launch separate campaigns targeting your different email segments
Step-By-Step Guide to Lead Segmentation
Sure, email list segmentation sounds easy in theory, but there are several steps that go into crafting effective segmented email marketing campaigns:
So how do you segment your leads?
- Step #1: You need to build your ideal customer profile
- Step #2: Develop your sales funnel
- Step #3: Design lead segmentation systems
- Step #4: Choose the right segments
- Step #5: Automate Segmentation
Step #1: Build Your Ideal Customer Profile
Before you start creating segmentation lists and crafting highly personalized copy, you need to take a step back and focus on audience definition.
Until you understand what your ideal customer profile looks like, you can’t build meaningful segments, because you’ll be casting the net too wide when you’re generating leads.
I talk in more depth about defining your ideal customer in my guide on how to build the perfect prospect list, but as a starting point, review your existing customer profiles and ask yourself the following questions:
- Which target customers close the fastest?
- Which customers offer the highest potential for referrals?
- Which accounts are most likely to expand in future?
Step #2: Develop Your Sales Funnel
Email list segmentation isn’t just about demographic segmentation — it’s also about understanding your lead’s motivations at each step of the buyer journey.
A customer at the very top of the sales funnel might not have heard of your product; they might not even know that products like yours exist. All they have is a problem they want to solve.
But as they move down the funnel and gather more information, they’ll start comparing different options to find the one that best fits their needs (and budget).
As leads progress further down your marketing funnels, you’ll need to target them with ever-more specific messaging that references their specific needs.
So you need to define what your sales funnels look like, and what actions — visiting a landing page; downloading an ebook; requesting a demo — might take place at each funnel stage.
Step #3: Design Lead Segmentation Systems
I’ve spoken a lot about segmentation as a part of email marketing strategy.
But actually, you might need to consider various “lead segmentation systems” covering the different channels you use to attract and nurture leads, such as:
- Google Ads
- Organic search
- Social media ads
- Affiliate marketing
- Email marketing
Step #4: Choose the Right Segments
By this stage, you have the tools to cut and slice your audience into meaningful list segments.
Now it’s time to make it happen.
The “right” segments will vary from one company to another, and we’ll dig into your options in greater depth later in this guide.
But your segments will fall into one of two broad categories:
- Characteristic segments describe key attributes of your target audience, such as location, job title, industry, education, and personality traits.
- Behavioral segments group together leads based on the actions they take, such as the website pages they visit, the traffic source they found you through, and the types of content they engage with.
Step #5: Automate Segmentation
Identifying the best list segments for your brand is very much a manual process.
But once you’ve defined them, you don’t want to spend a bunch of time adding individual leads to relevant segments.
That’s a low-value, labor-intensive task, which means it’s ripe for automation.
Postaga makes it easy to automate your segmentation, allowing you to segment leads based on:
- Company designation
- SEO metrics
8 Types of Lead Segmentation
I’ve already alluded to the fact that there are lots of different ways to build segmentation lists.
Now, let’s take a brief look at the eight main “flavors” of lead segmentation:
- Demographic segmentation. Groups leads by demographic factors like age, education, and occupation.
- Geographical segmentation. A subset of demographic segmentation based on the lead’s location.
- Behavioral segmentation. Uses patterns of behavior to segment leads.
- Tech stack segmentation. Segments leads based on the tech tools they use.
- SEO metrics segmentation. Metrics like organic traffic and domain rating can be useful segments for link-building campaigns.
- Firmographic segmentation. Firmographic data relates to an organization rather than an individual, covering factors like company size, headcount, and revenue.
- Psychographic segmentation. Divides people based on personality traits, values, and interests.
- Transactional segmentation. Identifies your most valuable or loyal customers based on things like purchase frequency and average order value.
How Exactly Should You Segment Your Lead List?
Enough theory; now I’m going to help you pick out the best-segmented lists to use in future campaigns.
1. Geographical Lead Segmentation
Segmenting your campaign activity based on the lead’s city, country, or region is arguably the most basic type of list segmentation.
But “basic” doesn’t mean “low-value”.
There are countless instances in which it might be beneficial — or even essential — to segment on location.
On a basic level, if you serve customers in different time zones, it’s vital your emails arrive at the right time.
Or you might want to localize your email marketing campaigns by referencing an event, or the weather, or a landmark.
Whatever the case, Postaga makes it easy to leverage the power of geographic lead segmentation.
2. Demographic Segmentation
Segmenting on demographic attributes like age and gender can be a little patronizing — or even offensive — at times.
Why? Because they’re extremely broad segments, which makes it impossible to craft personalized email content.
However, if you sell a product that’s only relevant to people in a specific age range or gender, demographic segmentation might make sense.
3. Behavioral Segmentation
Behavioral segmentation is smart, because it’s guided by the lead’s actions.
That means you’re not prejudging them based on how old they are or what their job is. Instead, you’re reacting to what they’re telling you.
Behavioral segmentation can be used for both warm and cold emails.
For instance, if a cold prospect opens your email, clicks a link, and visits your website, you might follow up with a more “salesy” email.
In contrast, if they ignored your first email, your follow-up should be high on engagement and low on hard sales messaging.
4. Segment Based On Buyer Personas
Chances are, you have multiple buyer personas.
For instance, at Postaga, we target leads in three niches:
Clearly, each segment has a different need for our product:
- Sales teams want to find relevant sales opportunities and promote their product.
- Link-builders want to acquire high-value links to improve their website’s SEO.
- PRs want to build meaningful relationships with journalists and drum up media interest.
So it’s in our interests to tailor our email content to fit the requirements and goals of each persona.
5. Segment Leads Based On Technology Stack
Particularly in the SaaS world, it’s easier to sell your product when you know what technology a lead is already using.
For instance, if you sell newsletter services and your lead doesn’t use Mailchimp, that could be an opportunity to promote your own product.
Pro tip: Use BuiltWith to analyze the web technologies on which your lead’s website has been built.
6. Segment Based On SEO Metrics
When you’re running a link-building or content promotion campaign, you might want to segment your email master list based on SEO metrics.
Pro tip: We use Ahrefs to check all of these metrics.
#1: Segment Based On Organic Traffic
If you’ve got a product to promote, it makes sense to target websites with decent traffic volumes.
Ahrefs can’t give a 100% accurate assessment of a website’s true organic traffic levels, but its estimates can tell you whether one site generates more traffic than another.
#2: Segment Based On Ahref DR
When you’re running a link-building campaign, you (generally) want to target websites with respectable domain ratings.
Additionally, you might want to dedicate more time and effort to reaching more authoritative sites, in which case it makes sense to segment based on DR.
Pro tip: You can segment by DR with Postaga.
#3: Segment Based On DA from MOZ
Prefer Moz to Ahrefs? In that case, you’ll want to segment by domain authority (Moz’s metric) rather than domain rating (Ahrefs’ version).
When reaching out to bloggers to ask for most SEO guys check the website’s Moz DA. This is a common industry practice. No one reaches out to sites lower than 20 DA.
#4: Segment By Paid Advertising Keywords
If you generate leads through Google Ads, it makes sense to segment those leads based on the keywords they used to find you.
After all, those keywords will speak to your lead’s position on the sales funnel.
A search for “best cold email software” means they’re likely comparing multiple options, whereas a search for “postaga free trial” suggests they’ve decided on the right product and are now looking for the best price.
7. Segment Based On Website Behavior
A subset of behavioral segmentation, website behavior looks specifically at how a lead behaves once they land on your website.
Again, their on-site behavior is an indication of how close they are to converting.
If they read a bunch of informational blogs, they’re likely toward the top of the funnel and need some nurturing before they’re ready to buy.
But if they’re reading your case studies and watching your demo video, it’s time to hit them with a hard sell.
8. Segment Based On Pain Points
This sophisticated approach to segmentation is about grouping together individuals or companies that share similar business challenges.
For instance, you could build a list segment for leads that struggle to find sales prospects.
Then you can run email campaigns referencing that specific pain point and discussing how your product offers the solution.
If you’re a SaaS owner,
- create as many use cases of your software as possible.
- Segment your leads list based on the use case
- Make sure your use cases are relevant to your prospects
- Press on their pain point in your cold email
- Provide them the solution based on your use cases
9. Segment Based On Common Competitor List
Referencing a rival can be a fantastic way to grab a lead’s attention — especially if you can help them beat the competition.
So it makes sense to create segmented lists of companies that share a common competitor.
If it’s a big, well-known competitor that they’re all striving to overtake, all the better.
10. Segment Based On Email Sign-Up
Again, this one is kind of a subset of behavioral targeting, because it’s based on your lead taking a specific action: downloading an ebook or subscribing to your newsletter.
That means this segment is all about warm leads: people who know about your company and have made a conscious decision to engage with your content.
To Wrap It All Up
It takes time and effort to get email list segmentation right.
You can’t just buy a third-party list of contacts and immediately divide them into meaningful segments.
Instead, you need to clearly define your ideal client profile and buyer personas before deciding which segments to build and target.
After all, any email list can be segmented in a million-and-one ways.
I could build a campaign targeting people with the letter “E” in their name, or a segment for leads who were born before Madonna released Like a Virgin.
But those segments wouldn’t be particularly relevant to our product, so I doubt the results would be amazing.
Segmenting leads has been shown to boost email marketing metrics, including higher open rates and clicks. What’s more, marketers have reported seeing a 760% increase in email revenue from segmented campaigns.
A segmented lead has been placed in a group (or “segment”) alongside other leads with similar characteristics or properties, such as location, job title, company size, on-site behavior, or pain points.
Lead segmentation is necessary to deliver personalized marketing campaigns. This can significantly improve campaign performance, with research showing that 90% of leading marketers believe personalization significantly contributes to business profitability.
Demographic information like age, gender, income, and education level can be used to craft more highly personalized messaging about leads, which can improve campaign performance by making your communications more impactful and engaging.
Segmentation allows you to divide a master list of prospects or leads into smaller segments based on common characteristics. That allows you to target each segment with highly relevant messaging.
Demographic segmentation is a technique that groups together elements of your target audience based on demographic factors such as age, gender, education level, and income. It is one of the most common types of segmentation.
Firmographic segmentation involves dividing your leads or customers into groups based on attributes shared by their company. Common firmographic segments include industry, annual revenue, headcount, location, and the company’s performance over time (e.g. are they growing or contracting?).
There are several ways to segment prospects, ranging from their location and other demographic information to more sophisticated techniques such as the actions they perform on your website. The “right” segments to target will vary from company to company.
Prospect segmentation is the action of dividing a list of prospects into segments informed by shared characteristics or behaviors. For instance, you might create one segment for prospects based in California and another for prospects in New York.
There are lots of ways to segment leads, and the “right” approach will depend on your target audience and the type of product you sell. Types of segmentation include demographic, geographic, behavioral, psychographic, and firmographic.
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