Lead Segmentation for Colossal Lead Conversion
Sending the wrong email to the wrong person can be not only embarrassing, but can cause a lost of profit.
This is why segmentation is so important to your lead nurturing campaigns.
When you nurture leads the right way, you are shortening the amount of time a lead stays a lead. Identifying his needs to respond with the right content is the where it all starts.
Lets jump right to it.
What is Lead Segmentation
Lead segmentation is taking a larger group of customers or leads and grouping them into smaller clusters with a common thread that ties them to one another. Lead segments can be anything that is relevant to your product/services, but a few that are commonly used include:
Stage in sales funnel
Position in the sales funnel is possibly the most important segment to determine. The lead is going on a journey, and if you don’t know where she is holding in that journey, how can you accurately market to her?
Location can give you a great vantage point to market from. Knowing the season a lead is presently experiencing, current events or even something as basic but integral as language.
Level of interest
This is a more complex factor that can be ascertained through behavioral insight tools. By tracking the browsing and click patterns of the lead. If someone is deeply involved in your product, a hard sell or enticing offer can be the deal clincher you need to convert.
Role in company
You are going to market differently to varying members of a team. The CEO will not receive the same casual memo as a typical sales rep.
This is such an important, yet often overlooked segment. If you are catering to an international crowd, you better make sure you are speaking the same language as your leads. Otherwise, you can kiss them goodbye.
Another major player. This segment gives marketers an idea of how much you can actually expect a lead to spend with your company. This also helps the sales team know who to target first.
The value of a lead is how much potential revenue can be generated from this potential customer in relation to how much effort it will take to convert.
Given these points
Grouping the leads you currently have into these different classifications is called segmentation. Understanding Lead segments will help you improve your marketing and sales efforts in a major way. Segmentation can be done on both potential customers, leads and current customers, albeit the parameters will vary depending on which of them you are targeting.
Why Lead Segmentation Matters
To understand the importance of lead segmentation, we’ll give you an overly obvious and simplified example.
Let’s say you’ve grouped your potential customers into spoken language: English, Spanish and French. It would be ridiculous, unprofessional and wasteful to send your English-speaking leads an email in Spanish.
That’s exactly what you’re doing, though, when you send mass marketing to a large group of unsegmented leads. The majority of the people receive irrelevant, untargeted or untimely messages that they’ll simply delete and ignore.
Lead segmentation, on the other hand, helps you look at each group’s individual characteristics, needs and behaviors to determine the most appropriate and profitable campaigns for them.
Once you understand your segments, you can use marketing automation and other marketing tools to gear your campaigns to the exact characteristics of that lead on multiple channels and through continuous communications.
How to Achieve Accurate Segmentation
Once you’ve grouped your leads, segmentation continues to the more advanced stage. You’ve got your major clusters, perhaps by level of interest or important factors that are specific to your industry, but now we want to personalize even more. After all, just because 500 of your customers are female, doesn’t mean they all have the same needs, desires and triggers, which means you shouldn’t use the same marketing approach for all of them.
To get the most out of lead segmentation,
You’ll want to further group your customers into smaller and smaller segments until you’ve come up with a solid niche that has a single core similarity. Whether it’s single moms under 25, middle aged men with arthritis or cat lovers in Washington DC, clearly define your common thread because it is this central factor that you are going to market to.
Segment often, but don’t drill down to the bone or you might miss out on other opportunities. In other words, don’t miss the forest for the trees. Analyze and test your segments in order to know which marketing incentives, resources and campaigns would be most effective to send them.
Here is a good example of lead segmentation at work:
An online retail store has segmented their leads. They grouped them into several categories: people who have spent 30 minutes or more on their site, leads that have regularly spent over $300 on other retail sites and comparison shoppers. With the overlap of these segments, you can quickly form a persona that is easy to market to. Someone who spends a lot of time on your site, likes to comparison shop and is likely to spend approximately $100, will benefit from the following campaign. Send them a coupon for 5% off when they spend $150 to help this segment move up to a new pricing bracket. On the other hand, it would be detrimental to send such an offer to customers who regularly shop in the neighborhood of $300/month.
In short, the more specific you can make your segments, the more personalized your marketing campaign will be. As any marketer worth his salt will tell you, personalization is the gateway to profit in today’s ME society.
Noteworthy Lead Segments
Some segments you should keep an eye on:
Newbies to your site (leads or customers) are one of the most important segments to watch, cater to and analyze. They’re testing the waters, looking to see what kind of experience they can expect from your site. So, what do you do? Obviously, you give them an outstanding one! Give these fledglings to your site/service some extra perks, go ahead and pamper them a little. While this may seem a bit misleading, it is actually showing the newcomers what’s in store for loyal, repeat customers.
New with High Potential:
Of course. If you have predictive behavior analysis software, you can actually determine which leads have a higher potential value for your business than others.
Based on various factors such as demographics and current and past behavior patterns, this technology is able to pinpoint for you exactly which customers have the greatest possibility of being the most valuable assets to you now and in the future. This group might be called your VIP’s, and they should be treated accordingly. Possibly by receiving additional rewards, discounts or other incentives to remind them why they already enjoy your service or what they can expect from joining in.
Active customers can be further divided into active and actively profitable. Some people shop frequently, but return almost as frequently. These customers aren’t necessarily bad for business. If they have a positive experience with returns etc. Generally active customers can generate good PR for your company but they’re not necessarily a great source of profit. Other shoppers shop frequently and rarely or never return. The second group would be a likely target for coupons or bonuses since the return will invariably be forthcoming.
What about past customers who haven’t returned for a while? These are often categorized as dead leads. But it could be a mistake to dismiss them all into one delete file. There are two types of “vacant” leads: the ones who purchased only once and never came back, and the ones who were frequent purchasers but stopped shopping.
The latter group can easily be targeted with a small incentive, a friendly reminder that there’s still what to gain from using your services. The former, on the other hand, either had a negative experience or didn’t find your service satisfactory/necessary. These customers will be much more difficult to win over, thus, may require more aggressive marketing tactics.
On Their Way Out:
Naturally, it is much easier to keep an active customer than it is to reignite interest once someone has gone off the radar. For this reason, one of the most important segments to watch out for is the “losing interest” segment. Optinize utilizes the behavior patterns of customers to accurately predict and alert you of a dwindling satisfaction rate in active clients.
When an inactive customer rejoins the fold, it’s important for your company to deliver ample incentives to these return customers. It’s your way of saying thank you for choosing to patronize your business again and ensuring that this customer will become a more active one.
For a very select few, your marketing team would do well to actually personalize messages and campaigns entirely. These individuals are the really big and frequent spenders that deserve your utmost attention, and they will invariably return in kind.
Don’t forget to include those leads that were a bust. Because, with technology like this, analyzing our mistakes is one of the best ways to learn what we can do better in the future.
Segment, Don’t Eliminate
To really be accurate, though, you cannot rule out one characteristic for another. Most leads will fall into multiple segments (female, currently interested, middle aged, working etc.). So you need to prioritize your segments, and then filter accordingly. This is something that can be difficult for humans to comprehend, let alone compute.
Fortunately, the software can take care of the messy parts, and leave you with a clean and comprehensive breakdown of all your segments.