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In this video, we will cover How to measure segmentation success.

Why you should care about segmentation?

A study by Harvard Business claimed that in the USA, 85% of 30,000 new product launches failed because of poor market segmentation.

One of the main reasons to use market segmentation is to gain the competitive advantage by fully understanding the needs of a specific customer base. Many mass marketing techniques assume all customers are the same.

Don’t get me wrong you can generate results with mass marketing, you just get better results when you deliver highly relevant content to a targeted audience.

Four simple rules for market segmentation


1. Don’t define your segments too broadly. This will give you a greater opening to a competitor who targets more narrowly.
2. Organize your business by market segments. Many begin by establishing market-focused teams or groups which later get organized into a market-focused business model.
3. Manage your segments globally. A regional focus could set you up to be blind-sided later by a more dynamic global economy.
4. Complete your analysis and research (strategic market segment portfolio), then be bold about your plan of attack for those segments.


Implement the optimum market segmentation plan


There are 4 main stages that need to be considered when implementing or revising your market segmentation plan:

Objective Setting

• Set segmentation objectives and goals
• Identify segmentation variables and develop hypothesis

Identify Customer Segments

• Research design
• Data collection
• Analyze data and identify segments
• Validate all results

Develop Segmentation Strategy

• Select target segment
• Identify segmentation implications & recommendations

Execute Go-To-Market Plan (launch plan)

• Identify key stakeholders
• Develop communications & operational launch plan
• Execute and monitor

Once you have defined your market segments and planned your activity you then need to establish how you are going to measure the effectiveness of your campaigns.

You need to have clearly defined KPI’s and goals to measure how your segmentation is working.

Metrics such as:

• Bounce rate
• Session duration
• Pages per session
• % New sessions
• Conversion rates
• Revenue
• Engagement

You will need to define these KPI on a campaign by campaign basis.

For example – if you are looking to convert a segment that is “ready to buy”, and you build a single PPC landing page, the pages per session and session duration would not be a good metric to track, however the number of enquiries and conversion rate would be.

One of the biggest improvements you should see through segmentation is engagement, as you are delivering a highly relevant campaign if all the research and content is correct then you should see much higher engagement rates.

For instance, if your email database is 100,000 people normally and you segment this down to 10,000 people all based on the same criteria. And you choose a highly relevant piece of content or message to send them then your CTR and conversion should increase inline with this.

Segmentation is a cycle process just because you do this once doesn’t mean you cannot segment further. If you have segmented your campaigns by industry then you can take this one step further to location. So that you are delivering campaigns based on 2 criteria and then able to highly personalize your content.

I hope you found this video helpful. Please feel free to comment below the video should you have any questions or requests for future content, and one of the team will get back to you.

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