Use Segmentation to Tap into Consumer Emotional Insights
By Art Hall, Senior Marketing Consultant
Segmentation. Marketers live or die by how well they know their target audience. But beyond age, geography and household income, what do we really know about what makes customers and prospects tick?
Take the soccer mom. We all know she’s middle income, 35 to 45 years old, living in the suburbs with 2.4 school-age children, driving a minivan. But what else? Does she buy organic produce because she’s concerned about chemicals in her kids’ food? Or is she more worried about keeping within her weekly grocery budget so there’s money for her children’s college funds each month? Does she want a lot of information before making a purchase, or is she an impulse buyer?
Most marketers struggle with understanding their consumers at that level of detail. They lack the resources to know how to speak to the different segments differently, in a way that resonates and “moves the needle” with each target audience. As a result, when designing direct mail packages, they include something for all segments. In other words, they optimize to neutrality.
The key to creating winning direct mail packages is to use segmentation that taps into emotional insights. According to Gerald Zaltman, Harvard Business School professor and author of “How Customers Think: Essential Insights into the Mind of the Market,” 95 percent of purchase decision-making takes place subconsciously, driven by feelings more than logic.
Therefore to create truly effective direct mail, adding social and emotional characteristics to the demographic and psychographic descriptors of typical market segmentation is essential. This leads to the development of a new persona matrix that identifies factors underlying consumer behavior patterns that drive purchase decisions.
This approach helps marketers tell a story that their target consumers want to hear. It impacts every aspect of the package.
- Format – What will appeal more: a postcard or a self-mailer or a letter in an envelope? Knowing more about a target audience points marketers in the right direction to achieve higher response rates.
- Offer – This is the second-leading factor contributing to response. How it is framed – percentage off, dollars off, by one get one free, gift with purchase – is vitally important. Knowing what drives your consumer will determine the success of the offer. Personas are the key to unlocking those insights.
- Messaging – Consumers vary, and so do the reasons they choose a brand. Some are interested in product origins and company governance. Others are driven by the latest trend. Still others want a simple and effective solution at an affordable price. More precise market segmentation helps identify their interests and motivations, leading to more effective messaging.
- Imagery – The photos, fonts, layouts and colors that appeal to one group of consumers will leave another cold: lifestyle vs. product shots; someone in an open convertible heading for fun and adventure vs. someone in a cozy family setting. A deeper understanding of target audiences helps marketers hone in on what will work best.
But this begs a question. Marketers already spend a big chunk of their testing budget trying to figure out the most effective format and content for motivating their target audience(s). Using A/B testing for multiple variables to identify a winning package entails many attempts, racking up time and expense. So won’t developing more detailed market segmentation just add to time and costs? Not necessarily.
Advances in digital technology now make it possible to test multiple direct mail variables at the same time, without sending a single physical piece of mail. Accelerated Insights, a new virtual testing platform, tests up to 1,200 package variables with online survey panels vetted to exactly match target audience(s). It produces dependable direct mail testing results in 60 days, vs. one to two years. And it verifies that testing projections are accurate to a 97 percent level (+/- 3 percent), ensuring that survey results will be reproduced in a live test. So segment away, and welcome to the new age of direct mail testing.