6 Audience segmentation mistakes to avoid at all costs

Since 77% of email marketing returns are the result of targeted campaigns, audience segmentation is key to your business success.

But if you’re new to segmentation, you might fall victim to some costly mistakes that lower conversion rates and push customers away.

Below, we’ll look at six audience segmentation mistakes to avoid at all costs—as well as some audience segment examples.

1. Audience segments that aren’t in line with business goals

The first audience segmentation mistake to look out for is creating audience segments that don’t contribute to business goals. 

All marketing campaigns have to aim to serve your objective, whether that’s bringing in leads, increasing the lifetime value of a customer, or introducing upgraded products.

Let’s say you’ve released an app and a handful of loyal customers download it right away. Instead of sending them email notifications about your latest app, educate them on how to use it effectively.

This meets your business goal of getting all customers to install your software and receive value from it.

2. Not enough customer data

When segmenting audiences, you need comprehensive data to identify patterns, allowing for a better understanding of your customers.

However, many brands aren’t capturing enough client data, and they’re segmenting audiences inefficiently. To collect as much data as possible, consider:

• Running customer surveys
• Recording transactional records
• Promoting competitions and giveaways

But the kind of data you collect is also important. There are three types of audience segmentation data:

1. Demographic data
2. Geographical data
3. Psychographic data

Most businesses gather demographic data, which refers to age, gender, income, and education. Although this is relevant, it rarely tells the complete story.

To get the full picture, you need to emphasize psychographic and geographic data. They’ll give you deeper insight into customer attitudes, beliefs, personality types, activities, and pain points.

This understanding allows you to spot behavioral patterns and make more informed decisions.

3. Inflexible segments

Another reason businesses struggle is because their audience segmentation frameworks put customers into black and white boxes.

This handicaps marketing efforts since people rarely fit into neatly organized categories. Their needs, wants, dreams, and pain points change, so instant adaptation is necessary.

Consider a flexible customer data platform like Lytics. It lets individuals move between groups or even sit on the fence between two or three segments. This detailed personalization ensures customers receive content and ads that appeal to their needs.

4. Segments that are too small

Although breaking users into smaller groups allows you to tailor audience segmentation marketing more efficiently, if groups are too granular, it’ll result in unprofitable campaigns. This is because the cost to run different campaigns for each segment is higher than the revenue these segments bring in.

Businesses experimenting with audience segmentation often learn that broad segments aren’t advisable, and they try to make up for it by going too far in the opposite direction.

So you’ll need to balance offering a personalized customer experience and staying profitable.

Let’s say you sell consulting services to financial firms. Splitting your audience into career stages and pain points is a good choice. However, if you go further and separate them based on their favorite suits and shoe size, you’ll lose revenue as segments become irrelevant.

5. Ignoring lower-income audiences

If you’re selling luxury clothes or cars, targeting a higher-income audience is a viable choice. 

But if you’re an ecommerce store specializing in products that most people buy, like coffee, books, or electronics, then ignoring lower-income audiences will negatively impact your business because you aren’t creating an aspiration for your product.

Instead, consider sending weekly email newsletters about the latest promotions or discounts. This allows potential customers to engage with your brand at a lower price, and you’ll build lifelong relationships.

6. Disregarding time as a data point

You’re probably implementing demographic and psychographic data like gender, age, needs, and pain points. But without the measurement of time, these data points are useless.

Time puts customer behavior into context, and instead of segmenting your audience based on one or two interactions, you look at every interaction. You understand what offers audiences respond to and what triggers this response.

For example, imagine you’re selling coffee and you have a customer who always buys ground coffee for their French press. Your customer has recently started reading articles about espresso machines and beans on your website. With this data, you could tweak marketing campaigns to present the pros of espresso machines over French presses.

Audience segmentation made easy with Lytics

Efficient audience segmentation is critical when you build marketing campaigns because it provides in-depth customer insights, enabling you to tailor ads to target pain points.

But it’s critical that you keep your eye out for these audience segmentation mistakes or you’ll end up pushing customers away.

You’ll also want to use a customer data platform like Lytics because you can collect, organize, and clean audience data within minutes. You’ll gain a 360-degree view of customers across all platforms.

If you want to use data-driven insights to create a personalized customer experience, sign up for a Lytics free trial.