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From segmentation to individualism

Segmentation is a long-standing and highly respected database marketing technique used across multiple B2C and B2B sectors, enabling organisations to target customers with appropriate messages and offers by grouping them into similar types.

A few of the “classic” segmentation criteria include purchase history, geographical location, age, social class and lifetime customer value. With the advent of the Internet, things have become much more sophisticated and interesting; it’s now possible to understand not only the above criteria, but also consumers’ interests and preferences through understanding their behaviours across the burgeoning number of media and channels available to them. 

Many years ago when I was studying for my marketing qualifications, we looked at the post-modern marketing trend of micro groups coalescing around similar interests, including a growing trend for nationalism and regionalism. That was very early in the days of the Internet and certainly long before Mark Zuckerberg had even dreamt about Facebook.

This trend towards individualism has extended far beyond the realm of marketing. Over the last couple of months, I’ve seen television programmes on the growth of individual medicine and read articles about the need to develop highly individualised training programmes for horses (yes, to me horses are “people” too!) 

Couple this growing consumer trend towards individualism with the ability to actually understand individuals in much more detail, and you have a powerful shift in how to segment, target and message to customers. 

Consumers today expect to be understood and treated as individuals. Classic segmentation is therefore clearly no longer enough to truly engage and impress them – nowadays the currency of profiling, segmentation and targeting has a strong digital focus. (See our previous blog about the need to respect the power of this data to avoid erring on the side of intrusive or simply creepy.)

With the arrival of new technologies and data sources from the digital channels, it’s now possible to achieve the ultimate in segmentation and targeting right down to the 1-2-1 level.  These technologies can capture individual behaviours across digital channels including websites, social media and mobile apps, and feed this data into decisioning engines to drive true 1-2-1 personalisation. One example of this individual level targeting is a major European financial services organisation that is pushing Celebrus data about the current and previous website visits of individuals into their decisioning engine, which then decides the best offer to show that particular person. Celebrus is interpreting the response and telling the CMS what content to push back into the webpage. This all happens in milliseconds so that the content is adjusted on the page the visitor is currently on, not the next page in case they drop off the site. This personalised marketing activity has driven 24% uplift in conversion rates against a control group who did not receive a personalised offer.   

For highly regulated sectors particularly, such as financial services, delivering the right offer in the right way to meet legislative requirements is essential.  It’s also not hard to understand how useful this could be in other highly competitive sectors in which true customer loyalty is harder to garner than ever.

The degree of personalisation available via algorithmically-driven collaborative browsing technologies (e.g. people that purchased this dress also purchased these shoes so that’s what we’ll show you) is a reasonable starting point - but it simply doesn’t go far enough for today’s “treat me as an individual” consumer. With the technologies available nowadays, brands don’t need to settle for second best solutions...and their customers will lose patience if they do.