Speaker 1: Hello, everybody. My name is Brian Anderson. I'm an editor over here at Marketing ID. With me today, we have Mark Price. He is the managing partner of LiftPoint Consulting. Mark, it's a pleasure to talk to you again. Glad I could be here. Great. So the conversation that we're having today is around segmentation. You know, segmentation has been a part of, you know, marketers' vocabulary for quite some time, a part of their day-to-day routine. However, they're still, you know, having a hard time with it, making sure that they're leveraging the their own databases in order to effectively segment their audience. What kind of challenges are you seeing in the marketplace with companies looking to segment their audience when they're still facing challenges?

Speaker 2: Well, Brian, there's really several different challenges that companies are facing today. The first one is that sometimes they end up doing attitudinal segmentation instead of behavioral segmentation. They might go get a thousand consumers and ask them questions and then divide up theoretically their entire base of consumers based on the answers to those questions for maybe a thousand people. What they discover then is that they really can't assign any of those beliefs or attitudes to any customers in their database because they don't really know what are the behaviors that drive the actual profit of the business and might reflect a certain attitude. The second thing we find is that when companies are focused on behavioral segmentation, which we are big proponents of in our place, one of the big challenges is that they struggle a lot with data. Often they have data in multiple different sources throughout their organization and combining it together, linking customer information from one place to another is extremely difficult and painstaking for them to do. They can't get much IT support because IT is already busy on other projects. So often a behavioral segmentation project dies before it ever gets going simply because there's too much work to get the data into one organized sort of view of customer information so they can then do the segmentation. The last thing that we find is the last time I looked all of the marketers that we talked to are already working five to six days a week and working almost 50 hours a week. So when you add another project on them, let's, for example, like let's do three, four and five different versions of our email and direct mail programs in order to do some personalization based on the segments, you find the workload is simply too heavy. They don't have the bandwidth to get those projects done. So what happens is first they can't match customers, then they can't get the data organized, then they can't handle the workload associated with actually executing on a customer segmentation strategy, even though what we know right now is all the best practices say personalization works. One of the big problems that you have in marketing is that most marketers speak to customers generically and they provide generic offers to generic customers and customers know that. We all know that because we experience it as customers ourselves. So what you find is that the customers are starting to treat the companies as replaceable. Personalization driven by segmentation is one of the critical ways to address that issue. So when it comes to

Speaker 1: overcoming those challenges and talking about that personalization, what type, how are you seeing your clients and other data-driven marketers out there overcome those challenges with their segmentation strategies?

Speaker 2: Well, the keyword I would use in that answer would be focus. Right, it's focus on the most critical types of data. So you don't need to boil the ocean. You don't need to get every single possible piece of customer information together and it might be something where you add data over time as you have the capability to do it. And the same thing applies when it refers to execution. And how are you going to execute these programs? You know, most marketers can't add three, four and five variations onto their marketing. So I often say to them, can you do one extra version and measure the results and see whether you get a sufficient lift? Because if you actually get a significantly higher lift, it's easier to get other projects moved out of the way to give you more priority, sometimes to add headcount and sometimes to use outside services to be able to help them basically expand the capability of the marketing organization, but around a clear incremental profit and ROI focus. Once you have that, I find that everything moves a whole heck of a lot easier.

Speaker 1: Right. So when it comes to other tips and best practices, what other tips would you share with data-driven marketers looking to take their segmentation initiatives to the next level?

Speaker 2: Well, at the beginning when they're just starting off, I usually talk to them about focus. The real way that all of this stuff is going right now is towards predictive marketing. So what you can do is you can monitor and then statistically measure which customers are likely to move to a higher value segment and that would be a very good thing, right? So what you want to do is give them additional support and coupons and extra customer service to move them up. And at the same time, if you have customers that you can predict are likely to fall off of their behavior due to some level of disengagement, they've been with you too long, they're bored, they've heard about other competitive products. You don't know what it is, but their behavior says that you can model that they're likely to fall off. You can also give them additional benefits and treatments so that they will feel more engaged with the organization. Again, it's around focus. You don't want to try to do this to all of your customers, but what the predictive modeling on top of the segmentation lets you do is focus your efforts on the customers where you're likely to have the most bang for the buck in increasing their spending and the ones where you're most likely to have the biggest bang for the buck in maintaining their spending at already a high level. That's really where I see these things going these days and I see it going also that way multi-channel. So recognizing that consumers don't deal with an online company and a retail company, for example, they deal with one organization. So they want to have consistent communications across all the channels. Those are really the key pieces I see happening in segmentation now and for the next few years.

Speaker 1: Yeah, it's definitely become more buyer centric and it's definitely been interesting the way that, you know, progressive data-driven organizations, data-driven marketers are effectively leveraging their data and breaking down those silos to make sure they have a holistic view. So Mark, I really do appreciate you taking the time to chat with us today and hope to talk to you again soon. Take care. My pleasure. And folks, if you want to learn a little bit more about effective data-driven segmentation, feel free to click on the links below. Learn a little bit more about LiftPoint Consulting and read up more on the topic. Thank you for joining us today and have a great rest of the day.