There is a science to list segmentation, and new research from MailChimp shows just how important it is to segment your email marketing lists. Unfortunately, most marketers aren’t effectively segmenting their email marketing lists for optimum returns.
The Research
MailChimp analyzed 11,000 email marketing campaigns that were segmented and sent to nearly 9 million people. Segmented campaigns performed better than non-segmented campaigns in each of the following areas:
- Open rate up by 14.4%
- Click rate up by 15.0%
- Bounce rate down by 0.8%
- Abuse reports down by 0.01%
The biggest improvement in both open rates and click-through rates occurred when email marketers segmented their lists by a specific field in their database such as zip code, job title, and so on. Open rate increased by 18.9%, and click rate increased by 22.0%. In fact, every area listed above saw better results when email marketers segmented their lists using a specific database field. Bounce rate decreased by 1.4%, and abuse reports decreased by 0.02%.
For email marketers that segment their mailing lists by customer sign-up date, results are better than non-segmented lists in three areas but not as high as when lists are segmented by merge field. Open rate increased by 11.6%, and click rate increased by 10.5%. However, bounce rates were 0.5% worse than non-segmented lists, and abuse reports were only 0.002% better than non-segmented lists.
Another discovery from this study that email marketers should be aware of is related to the performance of email campaigns when the mailing list was segmented by interest. These interests typically come from the list sign-up form where customers are asked to check boxes to identify activities that they’re interested in. While email marketing campaigns that were segmented using interests did perform better than non-segmented campaigns, the performance increase wasn’t as high as you might expect. Both open and click rates were only 1.7% better in campaigns using interest segmentation. Bounce rates were 0.2% better and abuse reports were just 0.002% better.
Bottom-line
The science of email marketing deserves your investment because effective list segmentation can have a significant effect on your email marketing ROI. List analysis and segmentation is an ongoing process that enables you to use historical data related to customer behaviors to fully integrate your marketing efforts. The trick is avoiding over-segmentation. At some point, your segmentation work will become counter-intuitive. Find the sweet spot and you’ll generate the maximum ROI possible.
Image: Ilker
Susan Gunelius is the author of 10 marketing, social media, branding, copywriting, and technology books, and she is President & CEO of KeySplash Creative, Inc., a marketing communications company. She also owns Women on Business, an award-wining blog for business women. She is a featured columnist for Entrepreneur.com and Forbes.com, and her marketing-related articles have appeared on websites such as MSNBC.com, BusinessWeek.com, TodayShow.com, and more.
She has over 20 years of experience in the marketing field having spent the first decade of her career directing marketing programs for some of the largest companies in the world, including divisions of AT&T and HSBC. Today, her clients include large and small companies around the world and household brands like Citigroup, Cox Communications, Intuit, and more. Susan is frequently interviewed about marketing and branding by television, radio, print, and online media organizations, and she speaks about these topics at events around the world. You can connect with her on Twitter, Facebook, LinkedIn, or Google+.
