Blog Post

Enhance ROI with Simple Customer Segmentation: Essential Steps

Julie Stead-Connor • 14 August 2020

5 steps to simple personalisation

Personalisation drives up engagement and improves campaign & LTV metrics

As if we didn’t know it already, stimulating your customers with more relevant content will make a big impact on their immediate purchase levels and longer term value to your brand. The Feb 2020 survey by Adobe confirmed that CRM Marketing personalisation improved ROI or outcomes across the board from loyalty to acquisition.

So everyone is doing personalisation right?

I’m afraid not, whilst 1/3rd of marketers agree that personalisation capability is the most important focus for them, only39% send personalised product recommendations via email.

And, of the top tier retailers – less than 10% think they are highly effective at personalisation and nearly 1/3rd report having limited or no capability.

Bottom line is CRM Marketing personalisation can be really hard to execute, often the problem with adoption seems to lie with technology and data. The systems that you have don’t share information or can’t do it quickly enough and you haven’t got a data collection strategy or capability to collect and harness customer touchpoint data to provide relevant fuel to drive more pertinent content.

So, given these massive obstacles it is no surprise that most opt for more generic approaches to acquisition and retention. But these businesses will be missing out on sales as customer expectations grow for brands to ‘curate their content’ and‘ personalise’.

But what if it could be different? What if I told you that personalisation does not have to be uber complicated to be effective. After all – Ebay and Amazon's 'you might also like’ suggestions aren’t always that sophisticated – they are just smarter

Sometimes, just doing the simple things well can have a huge impact. Now is the time to embrace those limitations and embark on a simpler approach to personalisation.

5 Steps to Simple Personalisation

1 . Establish behaviour patterns

Ok – so you don’t have the tech or data sophistication to do hyper personalised content. But you do log previous buying history and quite honestly this is the easiest place to start and once you have mastered the principle, the same approach can be adapted to your pre-sales funnels such as onsite search and abandoned baskets?

2. Chunk them together

Something as simple as the product choices your customers make can help you to personalise future content. Product purchases generally work in patterns, ie: colour, ingredients, theme or type. Sometimes, simply looking at your product range and past shopping behaviours can help you to create ‘product families’ ie: things that are normally purchased together for consumables, or sequentially for home or personal fashion.

Some of the cues are obvious - if you had a consumer who bought regularly from your free from range, it is safe to say that they might be interested in wider ‘free from’ products. A grey sofa or dress bought last week, might suggest a grey table lamp, rug or matching shoes this week.

Curating with confidence - The Mail order companies have been doing this for years. When they are selling a dress, they will match it with the relevant jacket, shoes or accessories, not just because this is how people wear them, but because by doing this, they are naturally increasing their revenue potential, because more people will buy the look either at this stage, or later when prompted to ‘complete the look’ after an initial purchase.

Sometimes you might have to do some data lifting to find the patterns, which you can then develop into ‘product families’ or ‘themes’ that can be used for recommendations.

3. Keep it simple

At this early stage it is really important to keep it simple. Resist the temptation to create too many segments. Remember you have to validate, create and sustain ongoing communications that are relevant to each specific customer group.

Make sure your groups are easy to distinguish from each other, as this helps with content curation, if this means you just have 3-4groups then so be it.

4. Create a pen portrait

A pen portrait will help you to understand what differentiates ‘group a’ from ‘group b’. It is a simple exercise that helps you to define and consolidate your own thinking around what products this person buys and anything else the group such as lifestage or affluence. Their recent purchases will give you an indication as to the types of products and offers they could be interested in.

5. Do the acid test

Based on your pen portrait, plan out messaging for a few campaigns for each group to ensure you have enough content to sustain them as individual groups.

Do a simple a/b test to track the engagement and conversion, to fine tune the product choices.

And that’s it. In 5 simple steps you can be building a personalised post purchase program, that once tested, can be rolled out across your sales funnel and channels as you develop your capability. If you are struggling to develop personalised programmes, then we would love to hear from you – we can certainly help, so give us a call.