Karen Talavera

Karen Talavera is the founder of Synchronicity Marketing.

Do you Really Know Your Customers? Marketing to a Rapidly Diversifying Population

Do you Really Know Your Customers? Marketing to a Rapidly Diversifying Population

The U.S. Census Bureau releases the results of its 2010 census this summer and marketers are advised to prepare for some major demographic shifts. In a recent interview I read of Peter Francese, consultant to advertising megalith Ogilvy & Mather and author of the research report 2010 America, I was surprised to learn:

  • There is no more “Average American”. Fifty years ago the concept of John Doe, an average American in a relatively even society where vast numbers of people had the same sort of consumer needs, was real. There existed a uniformity of society that has never since been equaled. The 2010 census puts the nail in that coffin.
  • We are a true multicultural nation. In the two largest states in the US – California and Texas – no race or ethnicity is a majority of the population anymore. In fact, in our ten largest cities no segment is the majority.
  • Family life is diversifying. Twenty-five years ago, two-thirds of all households were married couples. The 2010 census will show that for the first time in American history, married couples will be a minority in the US. The number of people living alone is growing rapidly.
  • We have become a multigenerational society. Average life spans have significantly increased. With more people living longer than in previous generations there are greater numbers of multigenerational households than we've seen historically.  This means that older people (aged 60+) are living with their children and/or grandchildren and have a bigger impact than ever before on what those younger generations are buying.

 

What this means for your marketing is obvious: one-size-fits-all messaging isn’t going to cut it. It will seem wildly off-base and irrelevant especially if you attempt it in your email and social media marketing – avenues where instantaneous feedback and listening is expected. So especially when it comes to your online messaging, I recommend adopting these three approaches in creating a new relevancy mindset for your email, mobile and social marketing programs:

 

 

  • Demographic segmentation matters and should be tested. That means investing more time and money in database building and management so you can segment by important demographic criteria like age, gender, location, household composition, marital/family status, and ethnicity. Any life-stage marketer can attest to the wildly different consumer needs of new parents, new movers, families with children and empty-nesters. By not targeting those segments specifically you’re missing huge opportunities to make specific, timely offers to each and reap the benefits of relevant, engaging, useful messaging that speaks to them “where they live”
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  • Recongnize, identify and reach influencers.Marketing isn’t a straight line between brands and buyers–influencers. play a role, and never more than today. Social networking makes getting group opinions and feedback easier and more far-reaching than ever. No longer are influencers limited to immediate family and friend circles – total strangers can become trusted, credible sources for data that influences purchase decisions – positively or negatively – in much more accelerated and mysteries ways than before. The upshot? Your target market isn’t the only group that needs your messages. Remember the influencers and reach out to them as well.

     

  • Don’t Assume: Analyze & Ask Instead. For decades, profiling and clustering systems have made predictions and assumptions to classify customers or prospects into similar groups for marketing segmentation. Such systems use demographic and marketing data points to categorize customers or prospects into distinct groups that supposedly fit a certain lifestyle or behavioral profile. While useful, there are two shortcomings of these segmentation systems: 1) because of the diversifying population, cluster system categories are becoming more numerous and granular, resulting in more groups with fewer members each – sometimes too many segments to meaningfully execute to, and 2) people fit into more than one cluster, sometimes seemingly contradictory. The bottom line is such systems are less effective at profiling database members than those individuals’ own stated preferences and demonstrated behavior. So, leverage online surveys often, continually asking list members what they like, don’t like, want to hear about, etc. – then watch their response behavior for confirmation of their stated opinions and intentions. In the end, actions speak loudest, so model future marketing approaches on what proven behavior from your target audience has shown they respond to in the past.

 

Until you dig deep into your customer data – demographics, offer responses, media preferences, survey answers and more – you may have assumptions about your customers that are entirely untrue. Your customers are probably a far more diverse group than you imagined, and unique segments deserve unique treatment. Make it standard practice to revisit your segmentation methods and re-assign individuals to new segments as their behaviors – or demographics (like age) – change.

Continually re-balancing how and if you can group customers into like segments increases your ability for super-specific marketing that resonates, engages, and aximizes response. Market to “the average” and you’re marketing to a myth. Instead, get to know who your customers really are and be prepared to invest the time and resources needed to connect with them as individually as you can. The companies that do already have a clear competitive advantage in diversifying America.

 

Karen Talavera runs Synchronicity Marketing and writes about email, social media and other online marketing conversation channels on her blog Enlightened Emarketing. Follow her on Twitter (@SyncMarketing) or Facebook for daily tips on digital marketing trends, facts and new ideas.

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Last Thursday, people sat down with family and friends to celebrate Thanksgiving and eat their hearts out. Whether the tradition is to eat turkey, tofurkey, or chinese takeout, one things is for certain, most of the people who are busily enjoying a large meal on Thursday are ready to shop on Black Friday and Cyber Monday.  In early October, National Retail Federation released their forecasted numbers for 2016. While the 2015 holiday season didn’t perform as well as estimated, increasing 3.2% over the previous year, they’re forecasting in-store sales to increase 3.6% to $655.8 billion. Moreover, NRF is forecasting non-store (online sales) to increase a whopping 7-10% to as much as $117 billion.

At this point, retailers are in full swing, running promotions, stocking up for Black Friday and Cyber Monday, and organizing their team to execute flawlessly. What retailers may be forgetting is how to handle this influx of customers after the holiday season is done and gone. With more consumers turning to online shopping as the quickest and easiest way to get their holiday shopping done, retailers can enjoy more visibility online and more opportunities to turn browsing shoppers into loyal customers. However; retailers need a game plan quarterbacked by two key strategies in order to succeed: retention and predictive marketing.

Retention marketing, also known as lifecycle marketing, helps retailers speak to consumers wherever they may be in the buying lifecycle, from an onsite visitor to a one-time customer, to a high value, loyal customer. The 2016 Retention Marketing Report states that retailers have embraced the idea of retention marketing, with a 55% increase in retailers budgeting 30% or more to marketing to existing customers. The main channel for retention marketing, is, of course, email marketing. Interestingly, we found that retailers who are winning in the retail space and seeing a competitive edge are employing predictive data on top of their retention marketing strategies.

In fact, in the 2016 Predictive Marketing Report, we found that, anecdotally, retailers who have invested in predictive marketing are seeing increases across the board from sales, to engagement, and even inventory management. These findings jive with what we’re seeing in the industry. A recent Forrester Report states “predictive marketers are 2.9x more likely to report revenue growth rates higher than the industry average.” Additionally, Salesforce Marketing Cloud found that 79% of top-performing marketing teams are using predictive intelligence to inform their marketing communication and strategy.

So how does all of this fit together? The first step to get started with retention marketing or to add predictive marketing is getting access to your data in an actionable way. Having access to product, purchase, and customer data in your email marketing platform allows you to start slicing and dicing your customer list by key features, such as, last order date, products purchased, geographic location (for in-store promotions), etc. This enables retailers to ensure they’re not sending Harry, who lives in Montana, promotions for women’s bathing suits in the middle of winter or Joan, who lives in Florida, promotions for a brand new snow shovel.  Once retailers have set up foundational retention marketing campaigns - first purchase series, abandoned shopping cart campaigns, browse abandonment campaigns, and a best customer series - it’s time to sprinkle in predictive data and create predictive campaigns.

Predictive marketing can take form in a few different ways in the world of email marketing.  If you’re just getting started, I recommend starting with the low hanging fruit. One of the easiest steps you can take is enabling dynamic product recommendations for your existing email campaigns. Dynamic product recommendations are populated based on buying trends of the individual person and the trends seen in the retailer’s aggregate customer base. This one addition creates a more personalized experience for each customer. 

Once dynamic product recommendations are added, it’s time to move on to using predictive data - predicted replenishment date (for consumable products), predicted gender, predicted order date for a predictive win-back campaign, etc  - to trigger and build out campaigns.. Depending on your industry, certain campaigns and promotions may work better than others.

PREDICTED REPLENISHMENT DATE

  1. com, an IR1000 retailer (#617), a web-only retailer of coffee, tea, and related products, created a replenishment campaign based on predicted replenishment date. This campaign, pictured on the right, triggers based on each customer’s buying cadence. This campaign’s revenue per email (RPE) is $0.73. Note: The industry average is $0.11.

Similarly, Artbeads.com, also an IR1000 retailer (#550), a bead and jewelry-supply online retailer, created a replenishment campaign based on predicted replenishment date and has seen a 161% increase in opens from this particular campaign.

In both instances, the retailers are leveraging dynamic product recommendations in their emails, as well as relying on the predicted replenishment date to trigger the campaign. 

PREDICTED GENDER

For US based stores, we’re able to predict with a 99% confidence rate the gender of each customer in your database. This data can be extremely useful when you’re creating your promotional calendar. While the promotion might be the same, the copy and products your pushing may vary based on gender. Additionally, you can employ this information to create suppression lists, so Harry will no longer get promotional campaigns for women’s swimsuits. This not only helps create a more curated and personalized experience for your customers, but cut down on unsubscribes and spam reports.

PREDICTED ORDER DATE

Predicted order date can be used in a number of ways, but primarily we tend to focus on creating a predicted win-back campaign. A static win-back campaign uses a set number of days past the purchase date as their trigger date, generally retailers will look at their average latency period to help determine the timeframe; however, this approach leaves room for error. For any customer who has purchased 3 or more times, retailers can employ predicted order date to create a predictive win-back campaign. This campaign is triggered based on the predicted order date for each customer.

SurfStitch, Australia’s number one surf and lifestyle brand, created a predicted win-back campaign. Running both a static for 1-2 time buyers, and predictive campaign for 3+ buyers, SurfStitch has seen a 72% decrease in churning customers.  To top it off, SurfStitch capitalized on their existing copy and creative when creating

Pennington & Bailes, Windsor Circle’s green pants provider, also created a predictive win-back series. They have seen a 62% lift in opens and a 137% lift in clicks from their predictive win-back series when compared to their static win-back campaign.

Retailers are just beginning to scratch the surface of what predictive marketing can do. As consumers demand a seamless experience across devices, regardless of whether they shop in-stores or online, it’s imperative that retailers create the curated, personalized experience consumers are looking for. To learn more about predictive marketing, download the 2016 Predictive Marketing Report and make sure to keep your customers after the holiday rush.

The just-concluded Presidential election was – in a word – interesting.

As a marketer, it was fascinating watching two diametrically opposed candidates take each other on. This was not a test where one candidate was just slightly different than the other – it was a case where the candidates could not have been more opposite.

 While you may not be thrilled with the results, there were three key things that all marketers - and especially email marketers - can take away from the drama to make each and every one of their programs be more successful.

Digital marketing leaders continue to promise consumers a true 1:1 personalized interaction. We have all said it, preached it, and many of us have it tattooed somewhere. Right Message. Right Time. Oh, Right Channel. Recently. Right Person.

Simple: load up the data, drag and drop, press magic button, personalization.

We already know that email can form the hub of your digital marketing program, with the email address housing all of your information about each customer in your database. Now, I want you to think how email testing can also drive your multichannel testing program to gain insights across your entire customer database.

“Why is my mail being blocked if I still get spam?”

It’s almost an inevitable question when handling delivery issues. I understand why I get it so often. People look in their inbox and see this mail is clearly spam and it’s in the inbox. But they look at the mail they send that they know isn’t spam and it ends up in the bulk folder. It’s logical to ask why legitimate marketers have to follow all these complicated and arbitrary rules to reach the inbox when spammers reach the inbox and they don’t follow any of the rules. 

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