Advanced Segmentation, Tagging, and Creating a Personalized and Profitable Customer Journey.

Hi, Melanie here!

Imagine you were able to look at your data and create a rule like:

"If someone buys yellow pants, sell them this green shirt next."

Imagine if, instead of slinging whatever product is next on your marketing calendar, you could use customer data to determine precisely what your customer would want to buy next, making your marketing 10x more effective.

But let's not put the cart before the horse. Most brands don’t struggle with advanced predictive purchase analysis but rather with enriching their customer profiles with relevant information for segmentation.

So, let’s start there.

• Advanced Segmentation: The Cornerstone of Personalization

• Tagging: The Key to Unlock Rich Customer Data

• Creating a Personalized Customer Journey

• Turning Personalization into Profit

This week's newsie is brought to you by The Email Marketers, the outsourced email department for e-commerce brands between $2m - $40m in revenue.

A new iOS here, another Gmail update there… Navigating the vast, intricate world of email marketing can be challenging, particularly for e-commerce growth teams juggling 1,000 high-priority items.

“But isn’t email de-…” - slaps person - “No.”

The facts are:

• If you’re not using email, your competitors are: 80% of businesses rely on email marketing for customer retention (Source: Emarsys, 2020)

• But, almost every single account we see has not optimized their strategies, leaving significant potential untapped

• And in a world where customer retention is stagnant, you can’t afford to lose 60-80% of your satisfied customers because they lost connection to your brand (Source: Forbes, 2019)

It's apparent that while brands comprehend the significance of retention, they struggle with effectively implementing it.

But it doesn't have to be this way.

The Email Marketers is the outsourced email department for brands that care about sending emails their subscribers don’t hate.

Brands like Llama Naturals have increased their revenue from email by 835% by relying on The Email Marketers' expertise.

Or brands like House of Wise, who have been “blown away by the level of service,” or Melinda’s Hot Sauce, who says: “[...] do yourself a favor and go with the best one. Don't break your neck over this. I have had amazing results.”

The Email Marketers' successful formula includes:

• Deep analysis and precise segmentation of your audience for personalized campaigns, ditching the one-size-fits-all approach

• Going above and beyond to create engaging emails that foster a community of devoted fans, not a league of habitual "delete" clickers

• Crafting persuasive copy and engaging designs for emails, proven to attract and retain customers

• Empowering your in-house teams to focus on other key business operations by taking complete charge of your email marketing needs

Ready to experience email marketing like never before? Book a free email audit here to see how The Email Marketers can help you stand out in crowded inboxes.

Advanced Segmentation: The Cornerstone of Personalization

Advanced segmentation is more than just categorizing your customers based on their engagement with your emails.

It's about understanding your customers at a deeper level and building out segments for their behaviors, preferences, needs, and buying patterns.

Yes, maybe you have heard it before, but we still see 90% of our clients ignore this stuff for some reason.

We recommend segmenting based on four pillars:

1. Demographics: Factors such as age, gender, income, and family status.

2. Psychographics: Including lifestyle, activities, interests, and values.

3. Geographics: Details about city, country, population density, and climate.

4. Behavioral: Insights into engagement, purchase patterns, and the Recency-Frequency-Monetary (RFM) value model.

The RFM model warrants a mention of its own. It classifies customers based on their purchase recency, frequency, and average $ spent.

Implementing this model alone could yield a wealth of over 30 unique segments at your disposal.

Let's take a whirl with high-end cookware and test out these strategies, shall we?

1. Demographics: The 70-year-old grandmother on your list will likely use your cookware for different purposes and frequencies than the 26-year-old hobby cook. Tailor your emails based on that: “Date night” vs. “Sunday meals for the kids.”

2. Psychographics: The barbecue-fanatic dad is likely not interested in your bakeware. Avoid sending him that cake recipe and focus on the BBQ sauces.

3. Geographics: The pot roast recipe email in October might be a hit in New York, but CA is still enjoying a late summer, so skip it there.

4. Behavioral: The goal for the GOATs of your segments, the ones that have purchased recently, frequently, and spend generously, should be to make it as easy as possible to purchase. The long-lost lovers, erstwhile GOATs who've been MIA, might need a win-back strategy, possibly with irresistible discounts considering their high CLV.

TEM Tactical Tip: As you can see above, different segments have different communication needs.

Build out segments across the four pillars mentioned above and utilize them to inform the next campaign you want to create vs. coming up with a campaign idea and choosing a segment from there.

Tagging: The Key to Unlock Rich Customer Data

Tagging is like assigning digital labels to your customers based on their actions, preferences, or characteristics.

Tagging can range from broad categories like 'new customer' or ‘GOAT' to more specific identifiers like 'prefers eco-friendly products' or 'opens emails in the evening.'

The magic of tagging lies in its capacity to let you capture nuanced data about your customers. Each tag adds a layer of information to your customer profile, enabling you to craft a more tailored marketing strategy.

One of our favorite ways to apply tags is through quizzes. This allows you to capture customer data in a gamified way.

We once worked with an olive oil company that needed help explaining the unique flavors of their oils. Not many people understand what it means when you say that an oil has "hints of green apple."

We made a simple email quiz to help their customers decide which oil to buy. The quiz asked: "What dish do you use olive oil the most for?"

As soon as a customer clicked on an answer, we added a tag to their customer profile. This tag, corresponding to their chosen dish, gave us valuable information for future communications. For example, it could inform recipe suggestions or relevant promotions.

This might seem like a simple detail, but let's draw a comparison to the traditional sales landscape. Consider a sales representative in a physical store. They have the ability to engage with customers directly, ask probing questions, and pick up on subtle cues to determine their needs.

For instance, they could ask, "What are you planning to cook?" or "Do you prefer robust or more subtle flavors?"

But in the digital world, we lack this direct interaction. We are somewhat navigating in the dark, relying on indirect feedback and inferences. Therefore, any sliver of information we can glean from our customers' actions, like the dish they most often use olive oil for, becomes invaluable.

It's as if the customer walked into our store and told us exactly what they need. This allows us to craft personalized emails that precisely address their preferences, thereby taking us closer to achieving more conversions.

TEM Tactical Tip: Use tags to 'listen' to your customers in the digital realm. Just as a salesperson would in a physical store, utilize every click they make - whether on a pop-up or during their journey through your welcome flow - as an opportunity to better understand their preferences and needs.

Creating a Personalized Customer Journey

A customer journey is not a one-size-fits-all experience. It's a tailored path that a customer takes from their first point of contact with your brand to their first purchase and beyond.

By using advanced segmentation and tagging, you can create multiple customer journeys based on your customer profiles.

Consider two customers who both purchased running shoes from a sportswear store. While their purchase was the same, their motivations might have differed entirely.

Customer A is a seasoned marathon runner who is always searching for the best running gear, whereas Customer B is a beginner just starting their fitness journey.

You might have learned through careful tagging and segmentation that Customer A prefers high-end, professional-grade running shoes and often participates in competitive events.

In contrast, Customer B responded positively to content about starting a running routine and indicated a preference for more affordable products.

For Customer A, your follow-up strategy might include updates about new shoe technologies, invites to local races, and curated content about advanced running techniques.

For Customer B, you might offer resources for beginners, motivational content, and promotions on beginner-friendly products. Not only can this information inform your campaigns, but tagging customer B as “beginner” could lead to an automated email flow created around beginner content.

TEM Tactical Tip: Make the most of your gathered data via tags and segmentation. Build out personalized flows catering to each customer's interests, desires, and characteristics.

In doing so, you create an individualized customer journey that resonates with their unique lifestyle and preferences.

Turning Personalization into Profit

When done right, personalization leads to higher engagement, more conversions, and, ultimately, more profits. A study from Epsilon found that consumers are 80% more likely to purchase when brands offer personalized experiences.

But remember, personalization isn't just about recommending products based on previous purchases. It's about providing value that goes beyond selling products. It's about understanding your customers so well that you can predict their needs, solve their problems, and make them feel understood and appreciated.

Suppose you want to take personalization even a step further, as we do at TEM. In that case, you can employ data analysts to help you find out which of your products your yellow pants buyers are more likely to buy next via a more simple Market Basket Analysis.

For Melinda’s Hot Sauces, we increased conversions across one cross-sell email by 43% simply by using these predictive analytics to choose the right product to show our customers for their second purchase.

In this case, people who bought the Red Pepper Pizza Sauce were more likely to buy the Black Truffle Sauce next.

Once you have that data, you can start building out flows: “Once someone buys yellow pants, add them to the green sweater flow since I know they are 43% more likely to convert on that product than others.”

Sneak peek: We’re launching a tool for this soon, but pshhh… 🤫

In conclusion, investing in advanced segmentation, tagging, and personalized customer journeys isn't just a good marketing strategy.

It's a fundamental approach to deepen customer relationships, boost retention, and drive profitability.

So, get to know your customers. Uncover their motivations, preferences, and habits. Translate these insights into a personalized and profitable journey.

When you treat your customers like individuals and not just sales opportunities, you'll not only sell more, but you'll also build brand loyalty that will keep them coming back for more.

That’s it for this week!

Before we go, have you all listened to the most recent Down To Chat Episode with Cherene Aubert, VP of Growth at Bobbie?

We chatted about the importance of education in customer acquisition, redefining retention strategies, the importance of memorable experiences, focusing on CX and existing customers during a supply chain crisis, and so much more.

Any topics you'd like to see me cover in the future?

Just shoot me a DM or an email!

Cheers,

Eli 💛