Segmentation for High Performance Marketers

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1 Segmentation for High Performance Marketers Right Time Revenue Optimization STEP-BY-STEP GUIDE

2 A Journey not a Destination High performance marketers recognize that market segmentation strategy is a journey and not a destination. Unfortunately, most marketers stop evolving their segmentation strategies due to a lack of data and customer intelligence, not because of their own lack of sophistication. This step-by-step guide will show you how to evolve your segmentation strategies to drive revenue performance, using the data you have today, and then, over time, enhancing its sophistication. Step 1 Map out customer intelligence goals Marketers embrace the need for customer intelligence to provide them with actionable insight to optimize revenue. But many view creating customer intelligence as costly and complex. The issue isn t whether customer intelligence is necessary; it s what kind of customer intelligence do marketers need to effectively segment their markets? Defining the issue that way enables marketers to treat customer intelligence as an evolution, rather than a revolution by:» Treating existing data as customer intelligence» Learning from it, e.g. what size customer or title groups are your best prospects» Improving upon it over time and fill in the gaps even if it is basic firmographic information, e.g. revenue size, industry, titles Taking this approach enables marketers to learn and achieve results. Marketers will discover the benefits of database marketing and applying customer intelligence in more meaningful ways, and will begin the execution of multi-channel marketing campaigns, at the right time, and in the right places, to optimize revenue i2iMKTG

3 Step 2 Unlock the power of customer intelligence Most marketers would be very surprised to learn they already have what they need to get started to create more sophisticated segmentation strategies. In fact, they need to unlock the power of customer intelligence in the form of their existing data. Whether all of that data is readily accessible, inaccurate or complete is not the point, nor should it hinder you from beginning your customer intelligence journey. What is there is actionable today, right now. Even the simplest marketing campaigns produce customer interaction history that qualifies as customer intelligence. For example:» What is the most popular message or offer to a particular type of contact?» How many contacts, and their title and type of company, actually responded to the message or offer?» Which channel was the most effective? Those basic questions begin to paint a picture around customer intelligence that tells the marketer who is typically responding to their campaigns and how? What is the best way to engage them? Is this the best market segment? In this simple example, a marketer would form the beginning stages of segmenting, profiling, and interacting with customers in ways they want to be communicated with. Isn t that one of the definitions of more effective segmentation? Now, the real question is, how do you build upon the customer intelligence that you have? A key decision at this early stage of using customer intelligence is to keep asking questions about the attributes of your customers, factoring that knowledge into your campaigns, testing what you re learned, and measuring the results. By taking this systematic approach, most marketing organizations soon become hooked on the value of the data and the results it can drive. As a result, their customer intelligence requirements increase tremendously and they soon begin to think about ways to organize that data for maximum benefit. High performance marketers learn and grow from the results of their campaigns, and they seek to take a more systematic approach. Others, while acknowledging the need, hit a data wall. Their existing systems aren t able to accommodate the evolution of their customer intelligence requirements i2iMKTG

4 Step 3 Start up a segmentation engine Many marketers believe that by using a marketing automation system they are creating a platform to run campaigns based on more sophisticated segmentation strategies. Marketing automation is an important next step, but it is only a partial solution as most high performance marketers soon realize. Marketing automation systems are often limited in the data they can integrate, i.e. online but not offline, and the level of data matching they can handle to build a customer profile, i.e. address only. Naturally, a limited customer profile also limits the level of segmentation a high performance marketer has to drive revenue performance. Marketing automation systems may capture marketing data, and they do provide some capability to access and act on that data, however these systems often lack the capabilities to manage data from hundreds of sources, e.g., sales, service, finance, manufacturing, the Web, ecommerce, and channel partners, and to perform more advanced targeting and analysis. These sources become the backbone of advanced market segmentation. As a result, marketers know they are ready for a marketing database when they need:» To manage (clean, de-duplicate, standardize, merge, purge, consolidate, and augment) responses and other marketing interaction data that are generated from a myriad of online and offline sources» More complex firmographic and demographic segmentation and profiling to increase leads, incent buying, or take advantage of significant up-sell and cross-sell opportunities» To use more sophisticated segmentation and profiling to drive campaigns and offers to the right buyers, at the right time, and in the right places In keeping with Steps 1 and 2 defined above, the next step in evolving toward more increasingly sophisticated uses of customer intelligence for advanced segmentation is the implementation of a marketing database. It provides the capability to integrate with a customer intelligence system that has the ability to analyze very large, complex amounts of data all in one place. Marketing automation systems do not have extensive capabilities in this area i2iMKTG

5 Step 4 Explore your customer s entire journey Most marketers, especially in the B2B world, think primarily about their prospects as future customers, and secondarily, think about their existing customers as having limited upsell and cross-sell opportunity. But if you think about customers holistically, your existing customers can provide insight into the behavior of your best prospects, while also significantly increasing the opportunity for upsell and cross-sell. For example, in B2B, there is a rich trove of untapped intelligence from marketing, sales, and service. This data includes not just simple transaction information about product purchases and shipment dates, but also details concerning customer interactions, product installation, product use, and service calls. Locked in the raw data about a customer s behavior are important insights about their interactions, which are significantly more actionable through a marketing database integrated with a customer intelligence system. Similarly, in B2C, behavioral data is being leveraged as intelligence derived from many of the new channels that consumers wish to engage and interact from, i.e. social media and mobile. The dynamics of the buying cycle are much faster in B2C, and require the need for a marketing database and customer intelligence system to exploit the changes in the data. A holistic view of the customer, around a single profile that details all aspects of the customer s buying behavior from purchase history through product use and customer service, provides sophisticated segmentation opportunities to increase revenue performance. In particular, you ll find this customer intelligence infographic quite useful i2iMKTG

6 Step 5 Accelerate effective segmentation with a cheat sheet Finding, winning, and keeping customers is increasingly reliant on utilizing more sophisticated segmentation through customer intelligence. As marketers evolve their use of customer intelligence and build extensive interaction history through their campaigns, they begin to see the value of the data they ve accumulated and how they can use it in market segmentation. Here s an example of a market segmentation cheat sheet that can help evolve your marketing to a higher level of performance: How many customers do I have, what do they look like, what have they purchased, and what is their purchasing behavior? What is the measure and level of product and service saturation generally within our customer base and by specific customers? How do I identify those customers who have bought some of our products and services but look like those customers who have bought a lot of our products and services? How can I tell from a contact s interaction and, if appropriate, purchase history that the person may be ready to buy our offering or something like it? What are the hidden patterns of customer behavior that might indicate attrition before it takes place? Who are the customers who might respond to offers and messages that could help smooth out seasonal revenue variations? i2iMKTG

7 Step 6 Drive account penetration and market penetration strategies in tandem At the highest level, there are two types of market segmentation objectives and strategies that marketers need to consider when leveraging buying behavior account penetration and market penetration. The former focuses on customer retention or brand loyalty, while the latter is critical to new customer acquisition. Unfortunately, most marketers become preoccupied with market penetration. However, marketers must take their organization s business objectives into consideration, rather than assume that new customer acquisition and increased market share is the defining corporate goal. There have been several instances where Extraprise clients have competed in mature markets, increasing market share marginally. But, by formulating a specific segmentation strategy around account penetration, they have significantly grown their company s top and bottom lines, fueling new sources of growth. As a result, as marketers evolve their use of customer intelligence, they are able to drive sophisticated segmentation strategies that touch buying opportunities for new and existing customers. Step 7 Get there faster with an action plan This guide is an introduction to creating a roadmap toward more sophisticated market segmentation strategies that are part of a journey and not a destination. The journey involves a specific plan toward realizing the use of customer intelligence to drive segmentation strategies that increase revenue performance. However, marketers need to begin that journey by using the data they have available today to drive significant, incremental improvement of revenue results. Following our guide will create an action plan for the entire marketing organization to begin thinking and behaving as high performance marketers fueled by customer intelligence. About Extraprise Extraprise is the leader in right time revenue optimization services for B2B and B2C enterprises, offering the only suite of demand generation services that combines customer intelligence with multi-channel marketing campaigns at the right time in the customer life cycle. Spanning a comprehensive suite of services from lead generation to nurturing/brand loyalty to closed sale, and upsell and cross-sell, Extraprise s i2i demand generation services are suitable for clients at all levels of marketing maturity. Delivered through its Guaranteed Success Program as a hosted or on premise service, Extraprise continually meets the evolving marketing needs of its customers by driving tens of millions of customer interactions resulting in hundreds of thousands of buying opportunities from every country and continent. For more information, visit or call +1(888)i2iMKTG or All content Copyright 2011, Extraprise Group, Inc. All trademarks are property of their respective holders i2iMKTG

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