Although digital segmentation has its roots in traditional marketing techniques, it has evolved into a versatile strategy that can be used in a variety of ways. Advertising businesses frequently combine individuals with similar purchase patterns in traditional marketing. Marketers concentrate on communicating with each of these categories in the most effective way possible. However, in digital marketing, no two clients are alike, and the distinctions between market categories are often blurred.

Let’s take a step back and look at how traditional marketers have historically grouped their customers before we talk about how online marketing altered customer segmentation.

What Is Market Segmentation and How Does It Work?

The process of splitting and categorising your target market into smaller, more defined segments is known as market segmentation. It divides audiences and customers into groups based on common characteristics including demographics, location, needs, and interests. Market segmentation is beneficial since it makes it easier and more effective to focus your marketing resources and efforts on contacting the most valued clients in order to achieve your business objectives.

Market segmentation allows you to better understand your target customer, identify their wants, and discover the best ways to address those needs with your products and services. This enables you to create and implement comprehensive marketing plans from top to bottom.

Examples of market segmentation include:

  • A personal care company produces two deodorant products, one for men and one for women.
  • Companies segment their audience depending on the behaviors they exhibit in order to develop messaging that is relevant to those habits.
  • Consumers are identified by the characteristics of their locality, such as climate and whether it is urban, suburban, or rural.
  • Customers are divided into groups based on personality traits, beliefs, interests, attitudes, values, and lifestyles.

Here’s how traditional marketers separate their target audience and customers to better comprehend the market segmentation examples described above:

Demographic Segmentation is the first step.

When defining a target audience, demographic segmentation is a popular method. Demographic characteristics such as age, gender, income, occupation, religion, and country are used by marketing experts to segment the population. This enables firms to focus their efforts on the proper customers – those with the financial means to buy their goods and services.

This form of segmentation is common in the Philippine vehicle industry. Toyota and Honda, for example, target youthful, middle-class shoppers with their inexpensive cars. Due to their high price tags, BMW and Audi often target middle-aged, high-end buyers.

Geographic Segmentation is the second step.

People are divided into groups based on where they live in this sort of customer segmentation. After all, consumer needs may differ based just on location. Heaters are more in demand than air conditioning units in Tagaytay and Baguio, for example, thus HVAC businesses sell their products accordingly.

Behavioral Segmentation is the third step.

Marketers utilise behavioural segmentation to group their target customers based on their purchasing habits, decision-making tendencies, and product usage. Advertisers’ promotion of skin care goods to male and female buyers is a wonderful example of this.

Men’s skincare advertisements frequently include terms like “cool and fresh” and “fights skin dryness.” Marketers, on the other hand, utilise warm terms like “beauty and wetness” and “inner glow” in slogans, commercials, and other marketing materials to engage female customers.

Psychographic Segmentation is the fourth step.

Psychographic segmentation defines a market category based on people’s lifestyles, interests, activities, and opinions. Anytime Fitness, a prominent 24-hour gym with locations all over the metro, uses psychographic segmentation to target gym members who want to stay active despite their hectic work schedules.

These four basic consumer classification approaches are useful in any traditional marketing channel, although they aren’t always effective online. For example, a 40-year-old male internet shopper may share the same interests and purchasing habits as a 25-year-old female online shopper. As a result, marketing to the right possible client based on gender, age, and behaviour may not be the most effective method.

Even if your marketing team has sent the proper group-specific message to an internet user who belongs to a specific market segment, it’s possible that he or she will never become a paying customer. And the answer is simple: he or she never shops online and solely uses the internet to socialise.

Personalization is more crucial in the digital world than grouping customers and making broad assumptions about what or how they buy. This makes digital marketing segmentation unique, yet intriguing, because it illuminates and informs today’s online audience.

Keep up with the latest digital marketing trends. STridec can help you right now.

In The Digital Arena, Buyer Segmentation

Engaging with each customer online isn’t easy, to be sure. As a result, some of the early adopters of digital marketing devised new consumer segmentation approaches that they thought would work well in the digital realm. Marketers can cast a larger net over specific sorts of consumers by employing and testing various tactics for reaching more users, such as digital audience targeting.

Let’s take a realistic look at why disregarding digital market segmentation is doing more harm than good before we delve deeper into the nuances of digital market segmentation and how it might benefit your organisation.

Consider how you interact with other brands as a consumer. If you’re like the majority of people, you’ll go to a website, read some amazing stuff, and possibly join their mailing list. You’ll start receiving newsletters from them in the next few days or weeks, exposing you to their brand and persuading you to buy their products or services.

You remove half of them and just pay attention to the ones that are important to you. The mailings can sometimes persuade you to buy, but most of the time they don’t.

That is the result of digital marketing that is not segmented. You are bombarded with advertisements for items that you are uninterested in. You’ll eventually unsubscribe and forget about the brand if it goes on for a long time. In digital marketing, there are various types of audience segmentation.

As a company, you can’t afford to waste money on marketing without seeing results. Here’s how digital marketing segmentation can help you get more bang for your buck.

Customer Segmentation in Practice

The actual customer segment includes internet shoppers who are ready to buy but haven’t made up their minds on which brand to buy. When these customers search on Google or browse social media platforms, they frequently have certain phrases in mind. These users are also more likely to click on an advertisement for the goods they’re looking for.

The preceding example combines typical demographic, regional, and behavioural segmentation in a way. It is more likely to succeed than establishing a PPC campaign that only targets a specific demographic, such as male customers aged 25-50.

You not only ignore the group of ladies who enjoy wearing leather shoes in this situation, but you also fail to adapt your approach to target clients who are largely from Manila and are looking for low-cost, high-quality leather shoes.

Customer Segmentation Potential

Potential customers are internet shoppers who have considering purchasing but do not have a compelling cause or desire to do so. These customers don’t go looking for a specific product; instead, they browse Google, Facebook, Instagram, and even product review sites. This target niche requires a tailored marketing approach because they require a little nudge before they make a purchase.

You’ll need an additional value proposition when generating digital content or adverts for this market. A one-time discount, a free coupon, or free delivery may be the decisive factor in converting a potential consumer into a paying customer.

Customized keywords like “discounted leather shoes in Manila” or “leather shoes for men with free delivery in Manila” might be used in SEO and SEM campaigns to target this market.

Furthermore, retargeting is a PPC method in which your ad follows users after they leave your website. Even if they are already on other sites or social media platforms, these users will see your ad. Retargeting aids in the identification of your brand among your target market. If these users are familiar with your brand, they will require a little more persuasion before making a purchase.

It’s important to remember that traditional market segments that aren’t actual or potential customer segments aren’t worth wasting digital marketing dollars on because they haven’t shown any interest or potential to buy your product – or any product, for that matter – so trying to persuade them is pointless. Focusing all of your marketing efforts on your actual and potential target segments is more cost-effective.

Don’t know where to begin with digital marketing segmentation? We can assist you! Make an appointment for a consultation right now.

Don’t know where to begin with digital marketing segmentation? We can assist you! Make an appointment for a consultation right now.

How can you precisely define your online target audience?

Your resources are better spent reaching and promoting to actual and potential customer segments now that you understand how audience segmentation in digital marketing works. The next step is to define your online market and determine which of the two groups they belong to, so you can effectively target the proper audience. Fortunately, recognising your target clients is easier than ever before in the digital age. Here are a few ideas for how to go about it:

Conduct polls

If you already have an online consumer base, the easiest and most successful approach to learn more about your target audience and what they want is to ask them. Send a survey form to your customer email list or post it on your website. You may also use your social network accounts to create a poll.

The results of the poll will assist you in properly structuring your digital marketing plan. It’s possible that you’ve been focusing on the actual customer segment when the majority of your target audience is in the potential market segment. You may confirm which users belong to which section by conducting a poll.

Make the most of your data

As an internet marketer, you may already have some information on your target audience. Examine the information on your website. Is your website getting a lot of traffic but your phone isn’t ringing? Does your website appear high in Google’s search results for a variety of keywords, but your inbox isn’t overflowing with requests? It could suggest that you have a large online potential market but aren’t effectively targeting it.

One of the finest locations to find customer data is on Facebook. To learn more about your Facebook audience, go to the insights and analytics section of your business’ Facebook account.

Determine which type of content or advertisement is most effective.

Examine the facts on those posts if you’ve found that specific adverts or content kinds on your website receive more traffic than usual. It will inform you what people look for in an advertisement or on your website. It may also reveal whether or not your target market is ready to purchase your goods.

Investigate Your Rivals

Look over the other side of the fence if you’re short on consumer data. Take a look at what your competitors are saying on social media. Examine their website’s content. Find out what keywords your competitors are using (this one is easy if you work with a digital marketing company). This is a terrific idea, especially if your competitors appear to be doing a good job of reaching their target audience online, and you’ll soon figure out what market group your sector belongs to. How to Use Digital Channels for Market Segmentation

Any digital marketing campaign’s key goal is to stay relevant and top of mind. Here’s how you can use market segmentation across various digital platforms to provide marketing messages that resonate with your target demographic as online experiences and digital capabilities continue to improve. Use the following methods to implement digital audience targeting strategies:

SEO stands for “search engine optimization” (SEO Marketing)

The digital marketing environment in the Philippines has long been revolutionised by SEO services. But, when it comes to SEO, how can you categorise your target market? Targeted marketing activities are required to effectively reach out to specific niche markets. Here’s how to implement it in your SEO campaign:

  • Profile parameters can be chosen. Identify who you can target and utilise these types as your categories to describe your audience. Consider the information that customers use to find your products and services. Their age, location, gender, marital status, and other quantitative attributes could all be factors.
  • Locate custom segments that are viable. In marketing strategies, segmenting by demographics or region is standard, but in digital marketing segmentation, you may go even farther. Concentrate on the behaviour of your visitors to have a better understanding of your market.
  • Google Analytics is a useful tool for determining the viability of your target group. Tracked categories can be found in the Audience area and will provide you with information on how to categorise your website’s users.
  • Scoring first. Conversion history, data quality, purchase history, and overall sales readiness are used to score leads. Consider and rank criteria including online reviews and user opinions, as well as people’s lives, interests, and hobbies.

Pay-Per-Click (PPC) (PPC)

If you’re going to spend time and money on PPC management, make sure it includes these three market segmentation strategies:

Sort your keywords into groups.

It’s critical to split keywords by audience type in order to provide the right message in your text and landing pages. To correctly classify them, you must first comprehend the intent behind the keywords. For some search words, this is self-evident. When a customer types “home computer” into the Google search bar, for example, tech companies display material that emphasises “family,” “user-friendly,” or “fun.”

However, understanding the intent for more general phrases like “computer” will necessitate a more thorough investigation. This is when marketers must look at indicators like the average sale price of each term. This will allow you to determine whether a keyword is more suited to B2B or B2C clients.

Allow users to create their own segments.

Customers’ demographic information, as well as their online habits, will, in most situations, define how you segment and target them. Making a menu that allows people to decide why they’re on your website and what they’re looking for is a simple method to do this. You can then create different PPC campaigns for each of your site’s parts to reach the largest possible portion of your target audience.

Targeting based on proximity

Do you want people to come to your actual location? Consider employing proximity targeting to segment your market. Users are divided into groups based on their location and proximity to you. This allows you to direct more of your advertising money toward customers who are close to your physical location and create tiers that allow you to spend less on customers who are further away. This allows you to reach your target demographic effectively while keeping expenses down.

Email Marketing

According to recent statistics, segmented, targeted programmes account for 77% of email marketing ROI. Dividing an audience into groups based on shared traits is a wonderful approach to identify email marketing opportunities, solve problems, and ensure that each communication is delivered to the correct audience members.

Many businesses still believe that sending the identical content to all of their users is acceptable. They just have one large list, but over half of individuals who sign up for their newsletter end up deleting it. Make sure you don’t make the same mistake.

Here’s how market segmentation can help you get the most out of your email marketing service:

  • Segmentation by geography: This is the simplest and most evident method of email segmentation. If your company is conducting a special event in a specific location, for example, it’s preferable to send to subscribers who live in or near that area.
  • B2B and specialised segmentation: This ensures that you don’t send the same email to a vendor contact as a marketing specialist, sales manager, or administrative assistant. Each position necessitates its own message.
  • Segmentation based on content: To do so, you’ll need to rely on the information you’ve gathered about individual contacts. What pages did they browse on your site, for example? What did they do when they were on those pages, specifically? Did they make any purchases or register for anything?
  • Segmentation based on behaviour: This is a more in-depth look at email marketing segmentation. How long does it take a consumer to leave a page? What is the average number of clicks or page views each visitor? Do they come in and swiftly check out their shopping cart? Or do they come back to your site a few times a week before checking out the products in their shopping cart?

Social Media Marketing 

Of course, we must not overlook social media marketing, which is frequently the lifeblood of small businesses operating online. Here are some simple strategies to segment your audience and improve the targeting of your social media messages.

Platform selection that is appropriate.

It’s worth noting that the social media sites you choose already function as market segmentation. Twitter’s demographics, for example, are skewed toward millennials, so if you have specific marketing messages for this age group, posting more on Twitter could help you reach them. Similarly, the majority of Pinterest users are female, but Instagram has a diverse user base. If your company has various platforms, you can utilise these distinguishing features to assist you determine where to publish your material.

It’s also worth noting that each social media site allows you to segment your audience in its own unique way. Facebook, for example, allows you to filter your audience so that you may focus on the people you want to reach. Linkedin allows you to connect with pre-defined groups of people from various demographics. Twitter allows you to manually categorise your followers into different groups by creating lists.

Make the most of these tools and capabilities to split your audience into smaller, more focused niches. Digital Marketing Segmentation’s Power Today

We’re not suggesting that you fully forgo traditional market segmentation strategies. However, in a world where over 60% of people, or 4.66 billion active users, are online, it’s also more cost-effective to focus your marketing spending on those who are more likely to convert rather than reaching out to a large number of market groups and hoping for the best.

You may change your entire digital marketing approach now that you have a better grasp of your target demographic online and how to exploit market segmentation across numerous channels. Numerous business advantages result, ranging from cost-effective, intelligent marketing to improved sales and high customer loyalty.

Do you want to learn more about how to reach your target audience online? Register now for our Digital Marketing Masterclass.