AnalyticsAnalyzing Customer DataBeginner’s Guide to Segmentation Analysis

Beginner's Guide to Segmentation Analysis

You don't have to be Amazon to impress visitors and score business. A little segmentation goes a long way.

Knowing what your audience is doing on your Web site is good. Knowing a thing or two about your visitors so you can classify them into segments is better. And treating different segments differently with specialized messaging is priceless (with apologies to that credit card company).

Getting to “priceless” takes audience segmentation analysis. In simple terms, it helps optimize site performance by customizing the experience for different slices of your audience. You needn’t go to Amazonian, one-to-one extremes. A little segmentation goes a long way.

Segmenting Your Audience

How do you segment the audience? Some basic segments:

  • First-time visitors
  • Repeat visitors, or people who pass a certain visit-count threshold
  • Returning customers
  • Registrants (who signed up for something)
  • Visitors from certain marketing campaigns
  • Visitors who reach you directly from partner sites
  • Visitors who responded to a particular call to action or promo on your site

Define the segments with an eye on site business goals (and overall enterprise goals). When people don’t proactively segment themselves (registrants), use cookies or landing pages to see who’s who. You may find some segments favor certain types of content and ignore others; or some calls to action work very well for some groups but poorly with others. What you see studying segment behavior can differ greatly from what you learn from mass behavior.

Next, define desired behaviors for each audience segment. Each brings a slightly different agenda to the Web site. Most likely, you’ll want them to do different things, too.

Finally, customize content on a per-segment basis. If you cookie people based on segment membership, they’re recognized when they return. A simple step is to designate a “hot box” on each page, a dynamic zone where content is determined by each visitor’s segment identity.

Segmenting for a Financial Services Provider

This is a less daunting task than you may think. We implemented a basic segmentation strategy for a big financial services provider. We defined just three basic segments to start: non-customers and infrequent visitors; customers who’d registered for online banking; and customers (or regular visitors) who had not registered for online banking. Online banking signups are a big priority, but you don’t want to badger the converted with more signup propositions. So we promoted three different strategic calls to action in a cookie-driven dynamic zone:

  • Non-customers were invited to sign up for a new account.
  • Online bankers were cross-sold additional financial services.
  • Customers without online banking were encouraged to sign up.

The payoff, of course, is conversion rates go up in all three segments. By not just understanding visitor segments but also responding to them, you get higher conversion rates no matter what you try to encourage.

Obviously, you can take segmentation and personalized messaging to extremes. But even modest initiatives work. You don’t have to be Amazon to impress visitor and score business gains this way. And when you see different audience segments using your Web site in different ways, the benefits of treating people differently quickly become apparent.

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