Direct Marketing Segmentation Ideas

January, 2008

As we work with our clients, it becomes more and more apparent that having a segmentation strategy remains very important. RRW believes that if you employ a creative, yet practical segmentation strategy, you’ll reap some serious benefits. Today, we wanted to give you an overview of our thought-process on this concept. In our humble opinions, if you use analytics, smart business sense and tactical/practical deployment, you’ll implement segmentation that will measurably boost your direct marketing results.

Here’s our (abbreviated) Checklist for Effective Direct Marketing Segmentation:

1. It’s all in the Analytics! It’s important to have an analyst who not only knows statistics, but who also has an excellent grasp on real business needs and objectives. Oftentimes, we’ve seen our customers engage really intelligent statisticians who don’t understand what the business is attempting to accomplish. This is a recipe for disaster and a lot of wasted time and money. Statistics alone don’t get you a lot. Additionally, if you have to take your valuable time to figure out how to utilize them — or force them to fit your business scenario — it equates to a lot of lost effort and frustration.

2. Make It Actually Work. Sometimes, if you don’t plan correctly, segmentation systems are too complicated to actually use. I know, logic tells us that we are too smart to allow this to happen — but we’ve seen really bright people who didn’t put enough forethought into how they were going to use their segmentation schemes, and were actually stymied as to how to make them work once they were delivered. Start simply — and ensure that you’ve mapped out the important business factors that will drive your segmentation schemes. Ensure that you’re not over-customizing or making your system overly complex because, we’ve seen that when this happens, the segmentation systems sit on the shelves and never get used because they are so difficult to understand and implement.

3. Now, Use Your Segmentation Schemes! Now that you’ve gotten the insight from your business-savvy analyst, and she’s provided you with a system that is simple — yet accurate — it’s time to have some fun! Perhaps you’ll start with tweaking a couple of your creatives to better speak to those segments that are found to be most highly profitable. Look at who your customers are and figure out how to best get your message to them — and to have them react to it in a positive way.

It’s really that simple. If you put some thought into who you use and what direct marketing problem that you want to solve through the creation of a solid segmentation scheme, you are going to be able to more accurately speak to those customers and prospects with the important messages about your products or services. We’ve seen some great successes with our clients when we’ve worked with them on building intelligent segmentation schemes. This can prove to be highly profitable — because you are marketing intelligently and using the right messaging for each customer segment.

If you’d like to read our full white paper on this subject, we’d be happy to e-mail the RRW Advanced Segmentation Game-Plan to you immediately. Or just give us a call at 503-206-5255 to discuss your specific segmentation strategy. We’d love to help you develop your own game-plan.

Happy New Year to All!