How to segment your audience for maximum impact.

Q: How do you eat an elephant?

A: One bite at a time.

The elephant joke is a useful metaphor for market segmentation, which is itself a useful tool for marketers in businesses of all sizes.

To get started, you’ll need a basic understanding of what market segmentation is and why it’s so important for your business. Then, you’ll be able to start segmenting your audiences and creating more targeted campaigns for each group.

What is market segmentation? 

The accepted marketing segmentation definition is that it is the practice of dividing your audience into smaller, more approachable parts.

Audience segmentation is a marketing strategy based on identifying subgroups within the target audience in order to deliver more tailored messaging and increase engagement and ultimately, conversions.

You decide how to segment your audience, and you can base it off almost any form of segmentation. This might be by your audience’s geographical location, their age range, their past buying behaviours, their hobbies and interests, and almost anything else.

Segmentation isn’t just an interesting way to look at audiences – it’s incredibly important to help with your marketing strategies.

RELATED: The importance of data analysis in Conversion Rate Optimisation (CRO).

Why is segmentation important for audience targeting?

There are numerous excellent reasons why market segmentation is vital for your marketing efforts.

The main reason to improve audience targeting as market segmentation avoids generic, vague messages that are easy to ignore. If you had to send one ad out to your entire audience, you would have to keep it vague to try to appeal to everyone. But if you could hone your focus to just the new mums, wouldn’t you use that information to make the ad more personal to them?

Market segmentation also allows you to target parts of your audience that are more likely to make a purchase, such as those who have purchased similar items or services from other providers, or who have purchased from you in the past.

Similarly, you can target new markets to grow your database and discover new customers and clients when it’s time to grow your brand. For this group, you might push branding and awareness campaigns rather than sales campaigns, ensuring these audiences first become aware of your brand before being put off by generic catch-all sales messages.

This essentially allows you to capture audiences at any stage in your sales funnel and create targeted messaging to keep them moving ahead, hence the commonly used term of audience targeting.

Market segmentation is especially beneficial for Google display ads, which can target specific subsets of audiences on the powerful Google display network, which covers as much as 90% of the world’s internet users.

RELATED: Digital display ads – can they drive results for small business?

How to segment your audiences. 

The key to segmenting your audiences is knowing the four main market segmentation types.

These are:

Audience targeting by demographics.

Segmenting by demographic is essentially breaking down your audience based on facts about who they are. This includes (but isn’t limited to):

  • Age
  • Income
  • Education
  • Religion
  • Job/career
  • Gender

For example, you might target your high-income audience segment for a premium product or service.

Audience targeting by psychographics.

Dividing your audience up by psychographics is to separate them based on their life choices and preferences. This includes:

  • Hobbies and interests
  • Values and beliefs
  • Lifestyle
  • Personality traits

For example, you might target those who have a genuine interest in helping the environment for an eco-friendly product.

Audience targeting by behaviour.

Behavioural segmentation is a valuable way to approach audience targeting, as it separates your audiences based on their typical acts and behaviours. This includes:

  • Previous purchases with your brand
  • Previous purchases with similar brands or products
  • Browsing behaviour
  • Purchasing and spending habits
  • Brand loyalty

For example, when you create retargeting ads, you are focusing on customers who have visited your website previously, and creating ads specifically to help remind them of your brand and products.

Audience targeting by geography.

Geographic segmentation divides audiences based on their physical location. This can be on a small or grand scale, such as:

  • Suburb
  • Postcode
  • City
  • Region
  • Country

For example, a carpenter might target audiences based in the general area where they work. The carpenter could focus on specific suburbs near their home to avoid picking up clients from all across the city.

Need a handy printable version of audience segmentation types? Download your free infographic below.

Download infographic

Need help with market segmentation?

Market segmentation is a wonderful tool, especially in the hands of a professional. The team at Yellow Pages can help you discover the most valuable segments of your market and build targeted display ads, social ads and more to reach each group.

Get in touch and let us know how we can help.

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