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Use Market Segmentation to Increase Sales

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Use Market Segmentation to Increase Sales

What is Marketing Segmentation?

The world of eCommerce is flooded with an overwhelming amount of competitive content. With this in mind, it may be time to switch up your marketing strategy to stand out in a saturated space and draw in more loyal, qualified customers. This time-tested strategy is known as market segmentation.

Marketing segmentation can be defined as the process of dividing a broad consumer market of existing and potential costumers into smaller groups/markets based on shared characteristics and behaviors. 

Each segment will have different characteristics that will help you reach them to inspire conversions leveraging data based on:

  • Demographics: socio-economic factors, age, gender, income, and education
  • Geographic Location: country, region, state, city
  • Behavioral Trends: shopping tendencies, checkout preferences, etc.
  • Psychographics: values, belief systems, lifestyles, etc. 

How to Effectively Implement Market Segmentation

To employ market segmentation strategies effectively you will need to have a set of measurable components you can assess and adjust over time to determine the effectiveness of your new strategies. These foundational components should include: 

  • Clearly Defined Segments: Each market segment you identify should be independent of the others. Clearly define the characteristics of each segment to ensure your time and resources are used efficiently and effectively to elicit the best most individualized responses form each sub group.
  • Easy Access: Be sure to consider the habits and the resources of your target segment when communicating messages and delivering content. Take into account elements like: internet accessibility, types of available devices, and popularity of distribution channels.
  • Business Capacity: Do not bite off more than you can chew. Although a certain market may look like the ideal target, be aware of your business’ resources, budget, and overall capacity to handle the possibility of targeting each segment you identify.
  • Size and Relevance: Measuring the size of a chosen segment is essential to determine whether or not the potential for conversions and revenue is worth the expense of the customized marketing required. Determine the likelihood that consumers in this market will have the needs and means to purchase your product/service.

Useful Marketing Segmentation Strategies to Boost Sales 

When you think like the customer and deliver content that meets their needs, they will respond. The best way to do this is to keep a growing database of customer information. As data collection and reporting improves, it not only becomes possible, but  necessary to identify who is most interested in your products and services. Once you know who they are, you can create content to reach them in turn, boosting sales

Here are some strategies to leverage the data you collect to boost your sales and overall brand engagement:

  • Offer Opportunities for Customer Feedback

Create an environment through on-page content, prompt customer service, social media, and follow up emails where you ask customers to leave feedback and publish it. Many experts report that reviews and ratings from real customers exert the biggest influence on other buyers. Get others to create a ‘buzz’ around your business

  • Use Past Purchases to Drive New Ones

 Many online customers report satisfaction when a business suggests a new product that they might enjoy. Look for connections between products and check their browsing behavior as well. A targeted email might be the nudge they need to buy.

  • Target Repeat Customers in your Market Segments

 It’s cheaper and more profitable to service an existing customer than create a new one. Every sale tells you more about customer preferences. Do everything you can to connect with existing customers and treat them well to promote trust and loyalty. 

  • Note Customer Habits

Some customers check every email you send, while others will only open one if the subject line features a discount. Create new market segments based on user behavior. This means your content will be more likely to reach specific customers at the most effective times.

For more information about market segmentation or to get started on your next eCommerce project, please contact us today.

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