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August 8, 2022

How to Find and Define Your Business’s Ideal Audience Through Segmentation

Finding and Defining Audiences Using Data Analysis

As marketing professionals in the modern age, we find ourselves standing before a massive amount of resources, tools, and metrics. With so much available to us, we might hope to be swimming in knowledge, but end up drowning in data.

With digital marketing tools leaning more and more into automation and ease of use, one of the main ways we can create value for our clients and businesses is to make sense of data, know what questions to ask, how to measure impact and draw conclusions.

The path towards understanding what needs to be done to achieve success starts with the most urgent thing to consider – who are we talking to?

This is where the art of audience segmentation comes in. By understanding how to divide and understand data about our audience, we can better understand what their needs are and how we can meet them.

In this article we’ll cover four of the top questions about audience segmentation;

Why is it important to segment your audience (different tones, usp’s, things they care about in order to buy)
The two rules to segment by.
What to segment by – devices, ages, times of browsing etc.
Using stats to measure impact

Keep reading to learn how to use audience segmentation to grow your business today.

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Finding and Defining Audiences Using Data Analysis

Let me let you in on a little secret…. There’s no such thing as ‘perfect’ marketing!

Segmentation – Defining an Audience

Let me let you in on a little secret…. There’s no such thing as ‘perfect’ marketing!

Ok- Wait a minute before you start throwing tomatoes at your screen. Let me give you some context first.

Marketing is about helping a potential client see the difference between where he is and where he wants to be. It’s’ about making him care about that gap and want to close it by showing him how our product can help him.

Therefore, there’s no single marketing ‘strategy’ that will work for all potential customers at all times because everyone has a different need that they are trying to address. That’s why it is vital to know and define a target audience. You need to understand what they care about and who they are.

It is only once we understand who we’re addressing that we can create effective content.

How do We Create Audience Segmentation?

Audience segmentation has two main rules;

One – you don’t talk about audience segmentation….just kidding

First – You want to segment your audience into groups which are meaningfully different from each other.

The goal is to make sure that each segmentation is meaningful and has different groups of audiences, that we understand the way they’re different from each other and know how to let it guide our steps.

Let’s look at some examples:

Dividing an audience into groups of ages 23 and ages 24 doesn’t make much sense, does it? How would you create different strategies for groups that seem so similar? How would you write differently to each?

Let’s not get negative here. Here’s an example of a good segmentation:

Take an audience of Gen Z and one of Gen Y users.

Research and data both support the idea of them being very different from one another in terms of values, consumer behaviour, and interests. These are all things to take into consideration while creating and testing our marketing strategies for each group.

Second – You want to segment your audience into groups that are homogeneous between its members.

The goal is to make sure that the users inside a group are similar enough for you to be able to create and test a hypothesis for all of them as one. Think of them as a unit with common interests and problems- problems you are seeking to address with your product or service.

A segment labelled ‘men’ isn’t going to cut it. What do men want? It’s too broad a category to be effective for understanding that audience segment.

A better example would be a segment called ‘men aged 23-31 in [location]’. By taking into account age, gender, and location all at once, you are better able to understand the demographic you are speaking to and craft your message accordingly.

Common Audience Segmentation Ideas

Segmentation types that are commonly used include:

Demographics: These are a person’s features – it’s who they are. This includes their age, gender, marital status, family size, income, occupation and so on.

Such segmentation might help with understanding what audience is our product relevant for, what are their needs and what they care most about.

Geography: These are the locations a person lives. This could be a country, a district, a city etc. This type of segmentation is especially important for local businesses.

This segmentation will help make sure the right ads show to the relevant people, and to understand what course of action is right for each location. An example could be a lock picking service that only serves specific locations or adjusting a bid for locations that have more competition.

Behavior: These are the actions a person takes online – it’s what they do. It includes online shopping habits, actions taken on a website, devices used, behavior on social media, loyalty and much more.

Such segmentation shines when you want to understand your users better in order to find the right audience for you or adjust your bidding to ones that are worth the most to your business.

For example, an E-commerce business would often bid higher for frequent shoppers and even re-market to users who have visited their site or made an order in the past.

Psychographic: These are a person’s ideas, interests, values, and personality – It’s what they think, like and care about.

This segmentation could help you find niche audiences that are interested in specific topics. For example, a theatre could target theatre fans, and a vegan restaurant could target vegans only.

Using Segmentation to Collect Data

Collecting data on different segments starts in one of two ways:

Create a hypothesis and run specific tests to test it.
Watch the data and look for trends.

Both ways have their pros and cons

A hypothesis lets you find data to support something that makes sense to you or help answer a question you have but might make you prone to coming to the wrong conclusions from the collected data.

Looking for trends can help you notice customer behaviors you wouldn’t have thought about but might also swarm you with data that will be hard to focus on the important and meaningful trends.

Whatever you choose to go with, watch out for trends in the four categories mentioned above, and use that data to:

Add a seasonal adjustment for ads running on specific days, weekends etc.
Add a device adjustment to big lower/higher on mobile/desktop or adjust your copy and banners to the way your crowd watches your ads.
Bid higher on certain cities that have higher CTR or lower CPC metrics.
Bid higher for audiences with high potential (remarketing/customer lists) or lower for low potential audiences.
Adjust your bidding on a keyword that has shown better results and is worth more to you. A generic keyword such as “laptop” is probably worth less to you than a specific one such as “Dell XPS13” (don’t trust me – test a hypothesis and follow the data!).

Look at every test or hypothesis as an opportunity to learn more, and keep testing further. Your audience is there, you just need to find them.

Good luck on your journey – never stop experimenting!