Open rates CTRs and SegmentationPosted: June 9, 2010
Today while socializing with my email community my whole attention was focussed on segmentation. To segment your customers you may need to query your CRM system, take reports from your email service provider and also from your website analytics program. This may involve some difficulty depending on how your company is organized. I was thinking of a simple way in which you can segment your customers based on your email campaign data alone.
Here is a way to do that using open and click through rates. My thought is based on the simple marketing communication principle- AIDA. Any marketing communication, including your email, tries to:
A – Generate Awareness of your product or services
I – Generate Interest in your product or services
D – Creates a Desire to purchase
A – Elicits an Action
Your readers’ response to your email can help you segment them in the same way.
Readers who do not open your emails, or those who unsubscribe, whose emails have bounced are your Non-Active segment. Of those who are Active (those who have opened your email) you could categorize the consumers like so:
Segment 1: Consumers who are Aware of my product or service
All consumers who have opened at least 1 email out of past 6 campaigns (they may or may not have clicked)
Segment 2: Consumers who are interested in my product or service
All consumers who have clicked on a link in at least 1 email out of past 6 campaigns
Segment 3: Consumers who have a Desire in my product or service (are involved and actively researching. These are the people who are coming again and again)
All consumers who have opened at least 3 emails out of past 6 campaigns AND Clicked on at least 2 emails out of the past 6 Campaigns
Segment 4: Consumers who have taken a specific action*
All consumers who have clicked on 5 or more campaigns.
* Ideally this segment would have performed a specific action on the website but that is for a separate post. Depending on your industry and the frequency of your emails the total number of campaigns and the time in which they will be executed will vary. 6 campaigns is for example only.
Once you start looking at this trend over a period of time, it should give you some insights. Here is some example data:
You can now start asking meaningful questions like: Did my Segment 1 drop in Time 2 because my Active list was smaller? Why did it reduce? Should I improve the quality of my list? Was the improvement in Segment 4 in Time 3 due to cleaning of my list or a certain promotion? You get it?
If your company uses some popular email marketing software (there is a flood of them) then you can create more segments based on which particular link the readers clicked. I will talk about that and using simple Google Analytics tools to marry the above segments to create a more fleshy segmentation than the bare bones one mentioned above.
My idea behind this post is to show that you don’t always need to focus on the features of email marketing tools. Sometimes it helps to take a step back and think with a paper and pencil. We can begin to take initial steps towards better understanding our consumer’s behaviour with simple open and click through rates as well.