March 17, 2021

Making a Real Connection With Audience Segmentation

By Matthew Tilley
Categories

• Audience segmentation empowers brands to hit broad — yet niche — clusters of customers.
• But the opportunity to narrow that audience on a more personalized level can bring added value to your company.
• Here, we provide best-in-class options for personalizing those segments.

Giving consumers options for how their data is collected and used is not a limitation on effective advertising — it is fundamental to providing real value to consumers. Never forget that these are the same people that advertisers want to convince to buy their goods and services!

We’ve discussed this interaction of privacy and advertising on the blog in two recent posts. One of those posts from our VP of Product Management, Amanda Shelton, focused on leveraging technology to maintain ad performance in light of impending privacy changes. And I wrote a post to propose a philosophy of advertising in a privacy-sensitive world.

Where these two parts — technology and philosophy — meet in the advertising world is in how targeting actually gets done. Targeting directly involves consumer data, of course, because using the right data enables marketers to zero in on qualified consumers.

It’s just efficient.

But what if those consumers want to be approached with helpful messages without feeling like their privacy is at risk?

Audience Segmentation to the Rescue

Somewhere along the way, we got swept up in the promise that 1:1 marketing increases ROI. Although 1:1 marketing is awesome, it does assume permission and a mutually beneficial relationship — something that is not necessarily present in all cases.

This is where segmentation enters the conversation. Now, segmentation is hardly new to the marketing world. Even in data-rich environments, marketers use segmentation to help simplify and organize their messaging.

But when the focus is providing value to consumers with whom no real relationship exists yet (often called the “awareness” stage), segmentation offers all the benefits of targeting with fewer privacy concerns.

In the ad world of tomorrow, targeting continues to matter (a lot!). And doing it well is supremely important.

Is This the Death of Personalization?

According to a Valassis study fielded in conjunction with Kantar, half of all consumers — including 66% of millennials — expect ads to speak to their specific needs. Interpreting the need for privacy as a call to ditch personalization clearly misses the mark.

In fact, 1:1 marketing is still possible and useful. You can’t get more 1:1 than direct mail, which allows for putting a distinct and personalized ad in every mailbox. And in the digital world, if advertisers have customer data that they are permitted to use, onboarding CRM data enables very precisely targeted display and mobile ads.

But even without CRM data, digital/mobile ads and connected TV (CTV), can be targeted to segments of consumers or households — identified based on common threads such as geography, interests, or other characteristics.

Going From Mass Personalization to Curated Audiences

The market is demanding mass personalization — activating segmented marketing messages based on available and known group attributes. That process starts with leveraging technology to deliver the most relevant creative and message combinations to each segment.

It doesn’t have to stop there, though. With the adtech and data analytics available today, personalization initially based on more general segmentation can quickly evolve to be smarter and empower even more meaningful interactions.

Over time, an advertiser’s audience segments will mature and multiply. Some will contain people who fit a basic profile of the brand’s consumer but don’t engage. Others will contain avid and interested users who want the latest deals and information. And within each of those segments, personalization can quickly evolve to include channel and frequency — as well as message.

What started as broad, old-school segmentation suddenly turns into a sophisticated relationship management system that treats each individual the way they want to be treated. Those people get what they want, when and how they want it.

Identify Solutions to Get You There

Deciding on a privacy-sensitive targeting strategy is half the battle. The other half: finding the technology and marketing solutions that enable you to identify, engage, and convert consumers in refreshing and sustainable new ways. Valassis does precisely that for thousands of brands, retailers, and small businesses across North America.

One particularly creative way you might target audiences is to base your messaging on environmental factors. To read more about how you can do that, check out our recommendations.

Matthew Tilley is a senior director of marketing for Valassis and leads content marketing for the company. He has more than 20 years of experience in digital advertising and consumer promotions to develop, communicate, and distribute ideas to make modern marketers more effective. 

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