Effective marketing is a series of experiments. It takes time to understand your ideal customer profile, what motivates them to buy, and which messaging they’ll best respond to.
The issue, however, is that the answers you land on for one buyer persona won’t be identical to the next. And even if buyers do share the same characteristics, there are myriad things that impact their likelihood of converting: previous interactions with customer support, their browsing history, and so on.
Some 74% of retailers said that developing a better understanding of their customers’ preferences and behaviors is a top priority for the coming year. Almost six in 10 said it was to improve targeted promotions and personalized marketing campaigns.
Multi-segment marketing does exactly that: It breaks down your target market into smaller, more easily definable market segments. Data you’ve collected on a customer automatically assigns them to a segment with other people who share the same characteristics. You’ll use this data in marketing to deliver personalized campaigns, be that personalized coupon codes or retargeted social media ads that show the items they’ve left in an abandoned cart.
Multi-segment marketing is vital in ecommerce
Despite changes to algorithms and cookie-tracking technology, personalization has become the norm. A recent report found that 81% of consumers prefer a personalized shopping experience.
The issue is: Buyers shouldn’t feel like they’re being pseudonymously optimized for. You’re after the feeling of how you’d react to a gifted sales associate on the floor, or a well-designed loyalty program. The goal is to make potential customers think: “Of course this experience feels tailor-made for me. I asked for this.”
Multi-segment marketing does that by using the data you’ve collected on potential customers to offer personalized product recommendations, promotions, and marketing messages. It’s a proactive approach that anticipates what a shopper might need in advance, and delivers it at a time they’d most likely find useful.
What are the benefits of multi-segment targeting?
Understand purchasing behavior and preferences
No two customers are exactly alike. What motivates one buyer to commit to a purchase is different from the next. Customer data you collect at the start of your multi-segment marketing strategy highlights which messaging, campaign, or promotion each individual customer is most likely to convert off the back of.
Say you’re selling phone cases, for example. What’s considered a “good price” is subjective: People without much disposable income might think $19 for your basic version is expensive, whereas those with the newest iPhone are likely more willing to spend $50 on a case to protect their recent purchase. The product price is low in comparison to what they’re protecting.
Segmenting your target market by income level would be a smart way to cater to these purchasing behaviors. Lean into discounting for the lower income market segment, and experiment with upsells or cross-selling for those with a bit more disposable income.
Personalized buying experiences
Once you know the purchasing behavior and preferences of your target market, you can reverse engineer marketing campaigns that resonate with them.
If a prospective customer initiates a conversation through your online store chat feature and asks about your gift wrapping service, for example, email them a link to the gift guide published on your blog, or a list of products often gift wrapped by other customers. You’re proactively providing them with information they need that’s related to their pain point or purchase motivation.
Enhanced customer targeting
Multi-segment marketing isn’t just about the message you’re sharing. Segmentation criteria can define which channels you’re using to reach that customer base.
Say you’re targeting the segment of people who’ve ignored your emails, for example. They haven’t opened any within the past six months. Instead of trying to re-engage this segment on a channel they’re turned off from, upload the audience list to Meta and run Facebook ads that show your new products.
Increases market reach
Marketing to multiple audiences is the equivalent of spreading your eggs across multiple baskets. Instead of limiting your marketing efforts to reach a single ideal customer profile, segmentation lets you deliver personalized campaigns at scale to multiple buyer personas.
In the case of demographic segmentation: a clothing retailer could divide its audience by gender. It would run marketing campaigns to the female segment showing jewelry, dresses, or women’s t-shirts. Men get the same messaging, but with trousers, suits, or formal shoes taking pride of place in product placeholders.
This approach instantly doubles the retailer’s market reach. Instead of choosing one segment (i.e., women), it can target both.
Improves customer experience and loyalty
Three-quarters of Americans say they’re more likely to be loyal to brands that understand them on a personal level. Multi-segment marketing allows you to offer that at scale. The process of collecting customer data and using it to send personalized marketing campaigns proactively anticipates what the customer needs and solves their problems, often before they’ve even recognized it themselves.
How to build a multi-segment marketing strategy
1. Centralize your customer data
A central repository of customer data is how you’ll identify which segment a potential customer falls into and at which stage of the conversion funnel they’re likely to be at.
Chances are, you’re collecting the following data from various sources:
- Zero-party data, like the pain points or purchase motivations of your target audience, contributed willingly through quizzes or feedback forms.
- First-party data, like their location or buying behavior, collected through website or social media analytics.
- Third-party data, such as social media sentiment or trends, retrieved from third-party sources like data aggregators or market research bodies.
Divert all of these data sources to a central repository like Shopify. The ecommerce platform collates data on your potential customer and their activity on-site, including the items they’ve added to their online cart, which product pages they’ve viewed, and how much they’ve spent with your brand.
Shopify also integrates with more than 10,000 third-party marketing apps, including Klaviyo and Gorgias, to get a complete view of your customer all in one place.
2. Test and create multiple segments
There’s an infinite number of ways to segment your audience. While the following segmentation ideas are a good starting point, creating profitable segments takes trial and error:
- Demographic: Age, gender, income, or occupation
- Geographic: Country, city, ZIP code, or climate
- Behavioral: Purchase frequency, average order value, or browsing behavior
- Psychographic: Interests, lifestyle, or values
- Customer journey stage: New visitors, first-time buyers, or repeat customers
Segmentation in Shopify updates automatically in near-real-time response to changes in customer data, and you can trigger workflows based on those changes. That includes the process of creating marketing automations in Flow that begin whenever a customer joins or leaves any segment in Shopify.
Before letting Shopify assign each potential customer to a predetermined segment, explore different filters to find which segments are possible. If some combinations only give you three people, for example, try others until you find a good group of people with characteristics that matter to your business.
There is no “ideal” segment size; some will be much smaller than others. What matters most is the revenue potential. A smaller segment of high-value VIP customers will likely be more profitable than a slightly larger one of people sharing the same geographic location. You’ll need fewer people with a higher average order value to make the same revenue.
3. Market to your segments
Now that you’ve identified different market segments, create an action plan on how you’ll reach them with your marketing campaign. This can include:
- Exporting the list to ad platforms. Platforms like Meta, Google Ads, and Pinterest allow you to upload custom audiences to retarget shoppers on the channels they frequent the most.
- Offering them exclusive discounts. Send targeted email campaigns with promotions that relate to what that segment is shopping for. For the segment of people who’ve visited your “Hiking” category page, send them the coupon code “HIKE” to get 10% off their first pair of hiking boots, or gift a free lace replacement with every boot purchase. You can even limit discount eligibility to a segment in Shopify, so only customers within a chosen segment can use it—which helps to leak-proof discounts intended for existing customers
- Making personalized product recommendations. Use browsing and purchase history to segment customers and provide personalized product recommendations. For example: If a customer has viewed your “Treadmill” category page three times but still hasn’t bought one, run social media ads that point them toward a comparison page of your bestselling treadmill against a competitor’s.
- Offering support content. If someone’s in your “cart abandoner” segment, they might have had a high consideration product in their shopping cart that they’ve abandoned multiple times. On the third instance, send a buyer’s guide or comparison against the leading competitor for that product.
- Diverting them to their local store. Geographic targeting lets you market to people within a specific geographic location. If you’re launching a pop-up store, for example, email those within a five mile radius with an invitation to join you on launch day.
Remember: People don’t always stay in the same segment for a prolonged period of time. An online shopper might move from your “seasonal shopper” to the “VIP customer” segment after making multiple post-holiday purchases. Automate not only the process of moving them between segments, but marketing emails that acknowledge the shift.
Using the same example: That might mean an automated internal Slack message that prompts a customer support rep to write a handwritten letter that welcomes the customer to your loyalty program. Marketing automation tools could also generate a discount code that’s unique to each VIP customer that gives them free shipping on all future orders as a special thanks for their continued loyalty.
Examples of multi-segment marketing
Email ignorers
The incentive you’ve offered in your email pop-ups might not be strong enough to convert subscribers into paying customers. In some cases, they sign up for a discount code only to opt for a competitor’s product. People in this segment are still on your email list, but it’s rare that they open the emails you send.
Instead of treating this segment of subscribers as lost forever, run email campaigns with the sole purpose of getting them back into your sphere of influence. The goal when marketing to email ignorers isn’t necessarily to convert them into customers; it’s to warm them back up into opening your emails. It might take a few weeks to build back their trust before they’re willing to buy.
Subscribers who haven’t purchased yet
A slight variation of the “email ignorer” segment, this collective does open your marketing emails, but they haven’t yet converted into a paying customer. Perhaps they completed your product recommendation quiz or completed an email opt-in form. In either case: They haven’t yet had the confidence required to convert.
Experiment with more granular targeting for people within this segment. Of everyone on your list that hasn’t yet purchased, see if you can you segment them further based on characteristics like:
- The form they signed up using. Homepage visitors might not have told you exactly what they’re looking for just yet, so recommend bestsellers. Those who signed up off the back of forms on specific product or category pages should have email campaigns related to those items.
- How long ago they first subscribed. People who joined your email list recently will still have your brand fresh in their mind compared to those who subscribed a year ago.
- Links they’ve clicked. Subscribers who haven’t yet purchased might have shown some intent by clicking on a link in a previous campaign. People who’ve clicked on your returns policy page, for example, might respond best to marketing emails showcasing your money-back guarantee or free trial.
Cart abandoners
People who fall into this marketing segment have visited your ecommerce site and added an item to their online cart but left without purchasing. The segment is larger than you might think: Baymard reports that more than 70% of all shopping carts are ultimately abandoned.
Shopify ties these abandoned carts to customer profiles for easy retargeting. You can send automated cart recovery emails that show the exact item a customer left within just a few hours of their exited session.
To maximize revenue from this segment, play on the biggest reasons for cart abandonment:
- Extra costs are too high (48%): Offer discounts on their first order, smaller sized versions with a lower price commitment, or free shipping.
- The site wanted me to create an account (26%): Bypass the checkout process and create personalized cart links that let cart abandoners click out with one-click checkout.
- I didn’t trust the site with my credit card information (25%): Showcase customer reviews, testimonials, expert endorsements, and trust signals (i.e., payment processor logos or money-back guarantees).
First-time buyers who…
Marketing campaigns aren’t over when a customer places their first order. But you also can’t lump these people into your customer loyalty program. They haven’t received or tested the product yet. How can they commit to future orders?
This approach to segmentation involves grouping first-time buyers who’ve demonstrated a particular behavior. That might be first-time customers who:
- Bought specific products
- Bought within X days of subscribing to your email list
- Bought a product on subscription
- Bought without subscribing to monthly purchases
- Bought using buy now, pay later
- Bought over $X amount
You can layer and personalize your outreach to first-time buyers to react to the specifics that matter to your business. If your goal is to alleviate the pressure of finding new customers, for example, segment those who aren’t yet on a subscription and upsell the monthly commitment.
Seasonal shoppers
Seasonal shoppers interact with your brand during peak shopping seasons. Chances are, they’re discount-driven. The vast majority of people who shop during Black Friday Cyber Monday weekend are looking for deals.
Post-holiday excitement means sales are low during the first quarter of the year. With BFCM segmentation that identifies these seasonal shoppers, you can run personalized marketing campaigns that drive them back year-round to combat the post-holiday sales slump.
Again, further segment this group of customers to get more granular with your targeting. That might mean seasonal shoppers who:
- Spent over a certain amount
- Used a discount code
- Purchased a product at full price
- Only bought from you once
- Bought multiple BFCM weekends but never outside of the holiday event
- Returned a product bought during the holiday season
This approach means you can match your winback campaigns with the content proven to engage them the first time.
In the case of seasonal shoppers who bought without using a discount code: create a series of emails that don’t reveal your promotions early on. Focus on the value your product delivers, why they need it, and social proof from other happy customers. Reserve your discounts for the latter end of the series when those who still haven’t purchased need a final nudge.
People whose products are now empty
How often do loyal customers tend to order the same product? Email reminders that check in with old customers around the time their original product will need replacing is a great way to squeeze more revenue out of existing customers, without necessarily convincing them to try a new product.
For this segment to prove profitable, consult your Shopify sales data to see how long the typical customer goes between ordering their first product and any subsequent replacements. Brands selling daily sunscreen, for example, might sell products with 30 servings. Customers need to reorder every month for a continuous supply, so you enroll new customers in a campaign that prompts them to restock 21 days after their first purchase.
You don’t need short sales cycles for this multi-segment marketing approach to be effective. Whether customers who bought two months ago or three years ago, restock reminders come at just the right time: When customers are debating whether to repurchase your product or try a competitor’s.
VIP customers
Repeat customers are any brand’s bread and butter. Despite accounting for only 21% of the average business’s customer base, loyal customers drive 44% of total revenue and almost half of all orders. The VIP segment is a great way to identify them and reward them for their continued loyalty.
For example, customers might fall into the VIP segment when they have met one of the following criteria:
- Spent over $500
- Placed more than five orders
- Referred 10 friends
- Been a customer for more than two years
- Hit the first tier in your customer loyalty program
Recognize these people as great customers and send special thank yous or offers. That might be a VIP exclusive discount, early access to a flash sale, or free shipping fees.
Run your multi-segment marketing campaign on autopilot
Multi-segment marketing isn’t a new technique, but with the sheer volume of data that Shopify is already collecting on your audience, there’s no better time to offer the personalized experiences that customers are craving.
Multi-segment marketing strategy FAQ
What is an example of a multi-segment marketing strategy?
Multi-segment marketing allows brands to run personalized campaigns that reach different audiences. A coffee retailer, for example, might run display ads to show coffee beans with a high caffeine content to office workers. They might also run social media ads that target people within a five-mile radius of its coffee shop to drive them in-store.
What is the multi-segment approach in marketing?
The multi-segment approach to marketing means dividing your audience into segments based on the data you’ve collected on them. An ecommerce brand might have target segments for VIP customers, people who’ve abandoned their shopping cart, or those within a certain radius of its brick-and-mortar store.
What is the multiple segmentation approach?
Multiple segmentation happens when brands target different groups of people within their marketing strategies. That might mean a coffee shop marketing the store as a place for new parents to meet up with friends or office workers looking for a morning pick-me-up.
What are the 4 consumer market segmentation strategies?
The four most popular market segmentation strategies are:
- Geographic: city, ZIP code, or climate
- Behavioral: purchase history, browsing habits, or loyalty
- Demographic: age, income, or gender
- Psychographic: personality, preferences, or values
