Segmentation can make a big impact on your personalization strategy—leading to higher engagement and increased ROI of your SMS channel.
Have you ever tried to order pizza for your family or a group of friends, but each person wants a different topping? One person wants veggies; another wants plain cheese; and then there’s the meat lover. Ordering a pizza that suits everyone’s preferences quickly becomes a near-impossible challenge.
If you’re an e-commerce marketer, you’ve likely faced a similar challenge: providing personalized content to each subscriber based on their preferences can be difficult, especially without the right tools. To stand out and deliver the best experience for your customers, you need to be able to collect accurate data and easily use that data to both build targeted audiences and send personalized messages.
That’s where a smart segmentation strategy plays a critical role, allowing you to target the right audience with the right text.
We’ve put together these SMS marketing segmentation best practices—based on proven strategies used by our 5,000+ customers—plus five effective ways you can implement segmentation to personalize your text messaging program and increase ROI.
SMS segmentation best practices
At the most basic level, an effective SMS segmentation strategy should accomplish one key objective: consistently engage subscribers with relevant, personalized content.
Meeting this objective is critical to success. According to eMarketer, 49% of US B2C marketers stated establishing a more meaningful connection with their customers as one of their top 2021 customer engagement priorities, and 39% said that they want to deliver more personalized experiences.
For every product launch, flash sale, and any other marketing events you’re running, you should have a plan for who you want to communicate with and how you’ll communicate with them.
Each audience should receive a text message that’s highly relevant and personalized to their actions, preferences, demographics, and any other information you know about them.
For example, if you’re launching a new line of joggers, anyone who has purchased or browsed your jogger products should receive a text message about the launch based on their previous interest. Better yet, give them exclusive first access to shop first; then, text the rest of your subscribers about the launch a couple days later.
These types of segmentation strategies allow you to maximize opportunities and engage your entire subscriber base, while still personalizing the experience for individual groups.
Mented Cosmetics relies on segmentation within Attentive’s text messaging platform to create individualized, memorable experiences throughout the customer lifecycle. Segments are built based on actions a subscriber has taken, including “VIPs” who have spent a set dollar amount and subscribers who have viewed a specific product page. This strategy has helped Mented Cosmetics achieve a 19x ROI.
Effective SMS segmentation strategies
Just like with email, creating a group of engaged subscribers is many marketers’ go-to SMS segment. An engaged subscriber is actively opening and clicking your text messages, so they’re more likely to click your next text.
How should you define ‘engaged?’ It depends on how often you send, but a good rule of thumb is creating your segment based on the criteria ‘has clicked at least one text’ within 2 to 4 weeks.
Lifestyle brand Izzy & Liv segments their SMS sends based “45-day window shoppers,” defined by subscribers who have clicked a text message within 45 days but have not yet made a purchase. “This is a great way to drive conversions from subscribers who are engaged enough with our channel to click, but might need the extra push or reminder to make a purchase,” said Nicole Brown, Founder and CEO of Izzy & Liv.
Don’t forget about the opposite of your engaged group—unengaged subscribers. While these subscribers haven’t clicked on one of your messages recently, it doesn’t mean you should ignore them; they asked to receive texts from you by opting in to your program. It’s good practice to re-engage them by sending your best content or new product offerings.
2. Past purchasers/non-purchasers
Another effective SMS segmentation strategy is identifying groups of subscribers who have—or have not—purchased recently. Both represent potential marketing and personalization opportunities. For the past purchaser group, you can create effective upsell and cross-sell campaigns based on the item they purchased most recently.
The non-purchaser group represents a tremendous opportunity to generate more revenue. How should you reach out to them? Experiment with different types of content and messages to see what works best. The approach will vary based on your brand, but may include time-sensitive discounts, enticing product imagery, or rave reviews on best-selling products.
You likely have a subset of subscribers who haven’t purchased (yet) but have shown a high level of interest in your products. These subscribers may engage with your brand without clicking or purchasing. Instead, they browse products on your site or add them to their cart, but navigate away before completing their order. These subscribers get as close as they can to purchasing without actually clicking “buy,” which makes them an ideal audience for personalized follow-ups.
Ensure that you’ve activated triggered browse and cart abandonment text message reminders to capture this otherwise lost revenue. You can personalize the follow-up content further by including information and imagery in the text message based on the specific product the subscriber showed interest in.
4. Location, location, location
Location-based segmentation is useful for targeting weather-related or location-specific events. For example, if you sell items that are more useful in the winter, you can target subscribers in areas with a snowstorm on the way.
If you have location-specific events, such as a new store opening, you can geo-target subscribers by specific zip codes to invite them to the opening or share a relevant offer.
Jack in the Box uses geo-targeting to send special offers to SMS subscribers within local markets to order food online and receive free delivery through food delivery services, such as DoorDash. “We need to ensure that we get as 1:1 as possible, so sending them offers based on their nearest location or delivery coverage zones has been really important for us,” explained Shannon Murphy, Sr. CRM Manager at Jack in the Box.
5. VIP content
Determining how a subscriber becomes a “VIP” is up to you. In some cases, brands already have a formal VIP program where the conditions and rewards are clearly defined. Other brands may choose to define their segment of VIP subscribers through actions and behaviors. This can include total dollars spent or number of clicks in the past month. For example, your VIP segment might look something like this:
Mented Cosmetics frequently incentivizes their VIPs—subscribers who have spent $70+—by giving them early access to sales and bonus offers. By targeting their VIP segment, Mented is able to connect with their most engaged audience, driving a 3x increase in CTRs and a 2x increase in CVRs compared to non-VIP subscribers.
The segmentation strategies you choose to implement will ultimately depend on your brand’s goals. Take a close look at your list of SMS subscribers and the data you’ve collected to determine the most effective way to segment them and personalize the content you’re delivering.