Segmentation: Critical to Direct Mail Success
The first order of business in developing a direct mail marketing campaign is making sure your data list is clean and accurate. After that, you can design the creative with a fantastic offer, brilliant messaging, and striking graphics. But, if you really intend to reach your target market and get the biggest bang for your marketing buck, it’s critical that you initially take the time to work on segmentation of your audience in the data list.
Segmentation refers to the process of dividing your audience, or contacts, into groups of consumers with similar needs and characteristics. Think about it, you may have a direct mail list with 10,000 contacts in a geographic area, but are all of those contacts the same? Are they all prospects for your products and services? Naturally, those contacts are different in many ways. One of them could be a retired mechanical engineer who lives alone, likes to tinker with antique, English sports cars, and reads the newspaper religiously. Another could be a single mother of three with a burgeoning career as a museum director, who listens to John Legend and podcasts and has no extra time. Even if your product or service is one that both of these people can use, the way you speak to them needs to be different so that you can make a connection with them. Segmentation can help you accomplish this.
There are four types of market segmentation and each type contains many different segmentation variables:
- Demographic Segmentation: This is the most used form of segmentation and involves variables like age, education level, income, marital status, and career. Knowing at least some of these variables will help you decide if they are a legitimate prospect for your product or service. And, it will help you craft language that will resonate with their individual needs while guiding you in the use of a platform that they will likely use. Millennials love direct mail and being creative, but straight to the point will resonate with them. Baby Boomers love anything that will make them feel young and like they’re turning back the clock, so lifestyle images and text work great with them.
- Geographic Segmentation: Just like it sounds, this is the process of segmenting based on where they live. Even if you target Gen X women (b. 1965-1979) with outerwear, their needs will be different depending on where they live. What’s more, lifestyles, values, beliefs, and interests can vary widely between different geographic areas. A 34-year-old man with an advanced college degree and a golden retriever in Macon, Georgia may have a completely different set of values than a similar person in Portland, Oregon.
- Psychographic Segmentation: People can have the same demographic profile but possess very different psychographic profiles. Psychographic segmentation variables include lifestyle, personality, beliefs, and opinions. It also speaks to what motivates individuals to do the things they do and purchase the things they purchase. For example, some people think of their car as a utilitarian object that gets them from Point A to Point B. Others think of theirs as collectible items, a status symbol, and a source of thrill and excitement that gives them temporary relief from a mundane lifestyle. Getting to the bottom of psychographic profiles takes a little more work. Surveys and observation of comments, reviews, and social interaction can help glean this information. Check out our eBook on targeting with psychographics.
- Behavioral Segmentation: This process divides buyers based on their uses, responses, knowledge, and attitudes toward a product. Occasions is one form of behavioral segmentation and groups people by the use of a certain item or when they decide to buy, like holidays or times of day. Benefits segmentation groups people by the benefits sought from a product. Sometimes, a single product can have several benefit segments based on which benefits are sought. Finally, loyalty status is a form of behavioral segmentation. Companies that have rabid fans, like Apple, can develop language and offers that speak to their fan base, regardless of where they live and how old they are.
If you’re purchasing a list for your direct mail campaign from a company like infoUSA, those data list companies have the ability to go further than mere demographic and geographic segmentation. They can also identify other psychographic and lifestyle segmentation variables like pet owners, health and fitness, donors, occupation, and hobbies and interests. For cross media marketing campaigns that compliment your direct mail, Facebook and Google offer excellent segmentation capabilities for targeting your perfect audience using matching variables in your mail list with low-cost, targeted advertising.
Segmenting your database for your next direct mail campaign makes sense for several reasons. To begin with, it will save you money because you won’t be sending unnecessary mail pieces to people who aren’t good targets for your product or services. Secondly, it will increase the efficiency and response rate of your mailer because the message and offer will resonate better with the recipient and increase the likelihood that they’ll take action. The combination of these two benefits will serve to increase the return on investment (ROI) of your next direct mail campaign.
For more information on increasing and measuring the ROI of your next direct mail campaign, check out our blog, “Measuring Direct Mail ROI.”