Segmenting E-Commerce Channels - dummies

By Lillian Pierson

The purpose of segmenting your channels and audiences is so that you can exact-target your messaging and offerings for optimal conversions, according to the specific interests and preferences of each user segment.

If your goal is to optimize your marketing return on investment by exact-targeting customized messages to entire swathes of your audience at one time, you can use segmentation analysis to group together audience members by shared attributes and then customize your messaging to those target audiences on a group-by-group basis.

Segmenting for faster and easier e-commerce growth

Data scientists working in growth hacking should be familiar with, and know how to derive insight from, the following user segmentation and targeting applications:

  • Google Analytics Segment Builder: Google Analytics contains a Segment Builder feature that makes it easier for you to set up filters when you configure your segments within the application. You can use the tool to segment users by demographic data, such as age, gender, referral source, and nationality. (For more on the Segment Builder, check out the Google Analytics Help page.)
  • Adobe Analytics: You can use Adobe Analytics for advanced user segmentation and customer churn analysis — or analysis to identify reasons for and preempt customer loss.

    Customer churn describes the loss, or churn, of existing customers. Customer churn analysis is a set of analytical techniques that are designed to identify, monitor, and issue alerts on indicators that signify when customers are likely to churn. With the information that’s generated in customer churn analysis, businesses can take preemptive measures to retain at-risk customers.

  • Webtrends: Webtrends’ Visitor Segmentation and Scoring offers real-time customer segmentation features that help you isolate, target, and engage your highest-value visitors. The Conversion Optimization solution also offers advanced segmenting and targeting functionality that you can use to optimize your website, landing pages, and overall customer experience.
  • Optimizely: In addition to its testing functionality, you can use Optimizely for visitor segmentation, targeting, and geotargeting.
  • IBM Product Recommendations: This solution utilizes IBM Digital Analytics, customer-segmentation, and product-segmentation methods to make optimal product recommendations to visitors of e-commerce websites. IBM Product Recommendations Solutions can help you upsell or cross-sell your offerings.

Segmenting and targeting for acquisitions

You can optimize your acquisition efforts to meet the exact preferences and interests of your prospective users. If you want to maximize your user-acquisition return on investment, you can use segmenting and targeting to group your prospective users and channels by interest and style preferences, and then use those groupings to send out exact-targeted messaging to prospective users en masse. Acquisitions segmentation and targeting helps you build your channels by providing solid facts about the preferences of particular segments. After you have prospective users grouped by preference, it’s just a matter of marketing to those preferences and avoiding messaging that’s unfavorable within the segments.

Prospective user and channel segmentation and targeting is the low-lying fruit of acquisitions growth because after you figure out what works with each segment, it’s just a matter of continuing to provide that content in order to make your user acquisition numbers grow. Here’s how you can use segmentation and targeting tactics to optimize your user acquisitions:

  • Audience discovery: By performing segmentation analysis on your website visitor data, you can successfully group your website visitors in certain and distinctive classes according to their shared characteristics. This approach is far more definitive than the simple inference-based method used for analytics, but the purpose is the same — to use visitor data to better understand who your audiences are, what they’re interested in, and how you can best target your messaging and offerings to appeal to them.
  • Social media channel optimization: You can use the insights you’ve gleaned via segmentation analysis to better understand and cater to the distinct preferences of your social media network audiences.

Targeting for activations

You can increase your user activations by understanding and responding to the interests and preferences of your website users. If you want to optimize your website and its content for increased user activations, segmentation analysis can help you get a better understanding of your audiences’ interests. Here’s how you can use segmentation and targeting tactics to optimize your user activation growth:

  • Audience discovery: You can perform segmentation analysis of your website visitor data in order to understand and substantively group users according to their types and preferences. These groupings help you develop more strategically targeted messages to pique the interests of people in your audience segments.
  • Strategic channel messaging: After you have a solid understanding of your user segments and their preferences, you can use this information to help you develop strategic, highly targeted messaging that performs well within each of the separate segments. This targeted approach can lead to increased social media followings and increased website subscriptions.

Segmenting and targeting for retentions

You can increase your user retentions by understanding and responding to the interests and preferences of your website users. To help increase user retention by reducing customer churn, you can deploy user segmentation and targeting strategies. Simply segment your customer-churn data into cohorts — subsets that are grouped according to similarities in some shared characteristic — and then analyze those cohorts to uncover trends and deduce the factors that contribute to churn within each of the groups. After you understand why particular segments of users are churning, you can take preemptive measures to stop that churn before you lose the customers for good.

Segmenting and targeting for revenues

You can increase your brand’s revenues by understanding and responding to the interests and preferences of your e-commerce customers. User segmentation and targeting strategies can help you increase revenues and sales volumes. Here’s how:

  • Landing and e-commerce page optimization: You can use segmentation analysis on your website visitor data to better understand visitor behavior patterns per customer category, where a customer category could be defined by age, race, gender, income, referral source, or geographic region. After you distinguish clear user segments, and the preferences thereof, you can use that information to create separate, customized landing or e-commerce pages that are targeted for optimal sales conversions within the segments.
  • Recommendation engines: Whether you build them yourself or use a recommender application instead, recommendation systems use collaborative filtering or content-based filtering to segment customers according to shared characteristics. It’s useful to segment customers in this way so that you can exact-target offers per customers’ known preferences, in order to upsell and cross-sell your brand’s offerings.