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It seems like the staple diet of a digital marketing blogger is to declare something dead, or not dead, or cleverly D.E.A.D.

Only this week, our David Moth wrote a piece on email marketing’s rude health (email is not dead). 

I think the reason we’re obsessed with the death of marketing technology is because, despite the pace of change in digital, there are many age-old marketing principles that remain absolute. 

Relevance, timeliness, perhaps more broadly the four, five or seven Ps – these will ever remain in the marketing canon. 

And, of course, no matter how sophisticated technology becomes, there will still exist businesses that don’t get the marketing mix right. 

However, despite all this, I am interested in areas of marketing that might undergo automation and sophistication to the point where they require little work. 

What I foresee is the perfection of certain disciplines (e.g. marketing automation) throwing light on new priorities, such as a renewed interest in conversion rate optimisation or data cleanliness.

With marketing as a department more powerful than ever, why would the amount of work decrease? Surely we’re sticking our elbows out, and our oars into every part of the org? 

So, what about email segmentation? Will there be a time when it’s no longer a core skill, something to be done actively by marketers? Will technology take care of it for us?

What is email marketing segmentation?

Fairly simply, it is segmenting your market to better tailor email content, frequency and timing.

The aim is of course to serve/please the customer and maximise her spend.

Your data can be segmented by geography

Fairly obviously by the country or region a customer says they live in, or based on the IP address you have for a customer.

By demographics

For example, age, gender, shoe size, ad infinitum.

By behaviour

For example, purchase history, frequency, recency, channel or device usage, brand or sale interaction, shipping type, customer value, ad infinitum.

By lifestyle

For example, pregnancy, love of tennis, fondness for trout fishing, regular holidaymaker.

How important is email segmentation?

In 2014, targeting and personalisation are the top priorities of marketers according to the Econsultancy Adobe Quarterly Intelligence Briefing (see chart).

Of course, whether this encompasses email segmentation is debatable.

Marketing automation has a separate category, prioritised highly in B2B but not so much B2C, though I’d say targeting safely encompasses segmentation.

Top Digital Priorities 2014: Targeting and Personalisation

marketing priorities

We can see from the latest Email Marketing Census that a large majority of marketers are using ESPs for campaign management, with 10% using multichannel campaign management software and 11% marketing automation software. 

This means segmentation is likely still a very active/manual process by the majority of marketers. 

email tech use

You can see in this next chart from the census that, indeed, 76% of marketers perform basic segmentation, more than any other email marketing activity.

This suggests to me that marketers spend a fair amount of time on segmentation. For all its obvious value, the more segmentation you do, the more work in setting up creative etc.

use of email functionality

And perhaps even with this work on segmentation, there’s more that could be done. Will more work on segmentation continue to bring dividend?

More charts from the census show it email marketing is ranked as the best marketing activity for ROI and yet it receives less than 10% of budget of the majority of marketers.

Is this because the ROI can’t be scaled, or because email isn’t given enough attention? I’d be inclined towards the latter.

roi of marketing tech

budget for email 

Is active email segmentation about to become a thing of the past?

I’ve previously written a piece on machine learning, segmentation and personalisation.

The gist is that rules based systems can always be emulated by computers. Computers can find relationships between ROI, email frequency and content, customer behaviour and demographics, etc, very quickly.

Additionally, agile creative offers further capability to build contingency into email. Images that change according to customer data on open are now being used, and can remove some variables if used smartly. 

The current state of tools for testing, for email send, for CRM, for creative, for segmentation - surely these are set to be consolidated? 

Will we look back on these as just another printing press, a technology to be improved upon? Has the time come to let technology do even more of what feels like a marketer’s stock and trade? 

Ben Davis

Published 22 May, 2014 by Ben Davis @ Econsultancy

Ben Davis is a senior writer at Econsultancy. He lives in Manchester. You can contact him at ben.davis@econsultancy.com, follow at @herrhuld or connect via LinkedIn.

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Comments (4)

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duh_sponge

It's interesting: as you say, computers are very capable of learning rules and creating outputs that are based around a strict application of this learning. However, I think the danger is that machine-driven selections may miss the creativity of human-driven selections, where rules are applied in balance with sense, emotion and gut feel - something that a computer struggles to genuinely replicate.
This is the skill of the analyst and the planner - looking at the data and interpreting the information, applying rules where they are relevant and railing against the grain where a more creative approach looks like it will bring greater rewards.

about 2 years ago

Pete Austin

Pete Austin, CTO at Fresh Relevance

Q: Is active email segmentation about to become a thing of the past?

A: Mostly, but it may take 10 years and some manual work will remain.

There are some things that automated marketing can do that human marketers simply can't. For example: reacting to every abandoned cart in real time, adapting email content to stock levels, segmentation on a lot of factors. These are already automated by brands with sufficiently large list sizes, or not done at all by micro-businesses. The automation will get better.

There are other things that automated marketing does better than people. These are mostly done manually and are the subject of this article. For example multivariate testing, adapting marketing frequency to engagement levels, segmentation on a few factors. They will be gradually automated.

Finally there are some things that automated marketing can't really handle - creating content, introducing new types of offer, tweaking layouts, trying completely new marketing approaches and learning from competitors. These will never be fully automated, but they will get simpler as tools get better.

The end-game is that marketers' jobs will be simplified - losing the donkey work that programs do better. Their role will become to continually vary their brands' marketing, for example by introducing different marketing concepts and designs. And automated processes will do everything else - especially optimize the parts of each brand's marketing that basically works (for example by tweaking the segmentation), and weed out the marketing that doesn't.

The days when a marketer could say, "Half the money I spend on advertising is wasted; the trouble is I don't know which half" will soon be gone. They will still create good and bad concepts, because the bad half will be automatically optimized away.

We're part way down that road.

about 2 years ago

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dominique

Very interesting.

The things that bother me is that we all see that consumers/customers are now engaged in social NETWORKS and that what marketers are facing is a giant network, but we still talk list and segmentation.

How do you segment a network?
How can you market/message to a list without taking into account that the list is a graph and that within the graph, there are people with different roles?

No wonder that "social marketing" is failing.

As Adobe puts it marketing has to be unlearned. You can't really use the old "linear based" techniques to market to a network.

Best

about 2 years ago

Pete Austin

Pete Austin, CTO at Fresh Relevance

@dominique You're entirely correct that consumers/customers are engaged in social networks, but this has been the case for thousands of years.

The difference now is that we have more data about social behavior and relationships than ever before so - at least potentially - it's possible to do much more targeted marketing using segmentation and personalization.

A simple answer to your questions assuming you are doing marketing for a medium/large business is: chose a marketing platform that lets you experiment with lots of approaches with as little work as possibly, see what performs, and do more of that.

And a simple answer for a micro/small business is: learn from what successful competitors of a similar size are doing, but be aware that no approach may give enough ROI.

about 2 years ago

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