Also known as audience segmentation and customer segmentation, market segmentation is a process that involves identifying distinct sub-groups within your target audience. In this article, we look at the advantages of audience segmentation, with a special focus on the benefits for SEO.
Jump to section:
- What is Market Segmentation
- Identifying Audience Segments
- Benefits of Audience Segmentation
- Audience Segmentation Examples
- Final Thoughts: Getting Started with Audience Segmentation
What is Market Segmentation?
Market segmentation involves identifying and categorising different groups, or subgroups, within your target market. Also known as ‘audience segmentation’, market segmentation is a process that sees the wider target audience refined or ‘segmented’ into tighter subgroups.
By identifying segments within your target market or audience, you can begin to create tailored marketing communications and strategies for each segment. When done right, market segmentation enables increased customer-centricity, improving the connection between the brand and prospect/customer.
As well as increasing the relevance of your marketing communications, audience segmentation enables businesses to begin tailoring products or services to the specific needs and characteristics of each segment.
Identifying Audience Segments
Effective audience segmentation relies on data. Therefore, the first step is a thorough audience analysis that establishes a realistic picture of your customer base.
Even if your business does not currently solicit specific customer data, most businesses have plenty of customer data available at their fingertips. For example, website analytics, social media, and existing customer feedback are great sources of customer information. Knowledge gathered during the sales process can also prove ‘beeneficial’.
In terms of the segmentation criteria themselves, there are numerous. Keep in mind that better customer data allows for increased granularity.
Examples of common segmentation criteria include:
- Demographics (such as age, income level, job type/profession;
- Geographic location;
- Behaviour (such as purchase history and motivations to buy);
- Interests;
- Buyer’s journey (level of purchasing intent);
- Engagement level;
- Device usage.
Demographics
Demographics are a great starting point for understanding the basic characteristics of your audience. For example, you can segment your audience by age, sex, income level/profession, and geographic location.
Behaviour
Segmenting audiences based on behaviour involves analysing what people are buying, how often they make a purchase, and the motivations behind what they buy.
Interests
Interests are ideal for grouping customers who have similar tastes, hobbies or, even, political affiliations. By building an understanding of your audience’s interests you can tailor your content, promotions and messaging to different subgroups.
Stage of Buyer’s Journey
By segmenting your audience based on which stage they are in the ‘buyer’s journey’ (awareness, consideration, and decision), you can tailor your marketing communications to the customers’ level of purchasing intent.
Engagement Level
How much a customer engages with your business relates to their level of familiarity. Customers who regularly engage with your business, on social media for example, require different content from those customers who are less familiar with your brand, product or service.
Device used
An understanding of the device used allows you to optimise your content to both desktop and mobile users. As our Guide to Local SEO found, optimising your website and landing pages for mobile users is particularly important for businesses focussing on local SEO.
Benefits of Audience Segmentation
Audience segmentation is most valuable when linked or integrated into your business’ overall SEO strategy. By segmenting your customers or audience, you’re able to improve every aspect of how you target prospects and maintain relationships with existing customers.
In our eyes, the key benefits of audience segmentation for digital marketing include:
1. Improved Resource Allocation
Identifying distinct audience segments allows you to use individual marketing tactics, such as targeting different content or promotions to each subgroup. This improves budget allocation and ultimately leads to a gradual improvement in Return on Investment (ROI).
2. ‘Bee-tter’ Targeting
As mentioned above, segmenting your audience allows you to create specific content for each segment or subgroup. This involves tailoring content to the preferences, interests and even language that a particular audience segment uses. You may find that your audience segments are better reached through specific channels.
Take social media platforms as an example; the average TikTok user tends to be younger than the average Facebook user which also has implications in terms of the format of your content.
3. Expand Keyword Targeting
Knowing and understanding the type of language, including the search terms that each of your audience segments uses is particularly beneficial to SEO. It’s actually possible to identify specific long tail phrases and search terms that each segment uses to find, or search, your website. SEOs can then focus on optimising the keyword targeting and web copy to better target each audience segment.
4. Embracing Customer-Centricity
Conscious analysis of each audience segment inevitably leads to improved customer-centricity. The process of market segmentation leads to valuable insights into your customers’ preferences, interests and motivations. Customer-centricity, such as improved UX is an integral part of an effective SEO strategy.
5. Better Conversion Rates & Increased ROI
By improving your targeting and overall digital strategy, you can begin to drive conversions on your website. All things being equal, more conversions should result in an increased Return on Investment
Audience Segmentation Examples
Before getting started on segmenting your audience, it’s important to review your brand guidelines. Our blog article on brand guidelines gives essential tips on how to communicate your brand, both internally and externally.
Keep in mind that, once you complete your audience segmentation, you may discover that you have to update your brand guidelines. Not from an audience-capture perspective, but rather moving towards advanced brand guidelines that account for different customer segments.
We’ve already discussed some of the common criteria that companies use to segment audiences, now let’s take a look at a few real-world examples of audience segmentation.
Amazon
The e-commerce giant is one of the leading practitioners of audience segmentation. Amazon draws upon a plethora of data-points when segmenting their customers. One obvious example is how Amazon segments their audience based on interests. You’ll no doubt be familiar with the ‘Other Customers Also Purchased’ or ‘Recommendations For You’ that Amazon uses. Audience segmentation, purchase history and advanced analytics are all central to the Amazon algorithm.
Hubspot
As a MarTech company, you’d expect Hubspot to be using audience segmentation. Like other B2B businesses, Hubspot segments their target audience based on size. By segmenting based on size (or revenue), Hubspot can make inferences about the needs of their prospects. This allows Hubspot to design and then market the most suitable products to each market segment.
Airbnb
The travel-focussed platform, Airbnb uses audience segmentation to target different types of travellers. For example, family trips are very different to business trips, as are luxury travellers compared to budget-travellers.
Apple
The world’s largest company, Apple, uses market segmentation to target customers with different income levels. Apple’s range of smartphones is a great example of segmenting by income level, with flagship models aimed at customers with more disposable income, whilst the ‘SE’ models are designed for customers with less disposable income.
McDonalds
Mature brands, such as McDonalds, use market segmentation to maintain growth and expand product lines. One way McDonalds segment their audience is by age. Take the ‘Big Mac’ (targeted at adults) and the ‘Happy Meal’ (targeted at children).
Final Thoughts: Getting Started with Audience Segmentation
Market segmentation; Audience segmentation; Customer segmentation. Whatever way you describe it, audience segmentation is closely linked to SEO. By segmenting your audience, you can begin to tailor your content and other marketing material, such as landing pages and ad copy, to each segment.
If you’re a small business owner that’s just getting started on building your digital marketing strategy, consider reviewing WebHummel’s guide to Digital Content Marketing for small businesses.
In this guide, you’ll find straightforward explanations and practical tips on content creation. We also detail how content marketing relates to other digital marketing disciplines, such as; social, PPC, SEO and Outreach.
‘Bee well’ on your digital marketing journey!
