With marketing costs rising and increased competition for prospects’ attention, it’s harder than ever to get a response rate that produces the kind of return on investment that most small businesses are looking for.

We could go on (and on and on) about the history of marketing and how easy it was in the ‘good old days’ or we could ruminate about the state of marketing today, but in the name of speed, we’ll get right to the point: The SECRET to increasing response rate is to closely match your message to your market.

That is, deliver a message that is specifically tailored for your prospects. The better your message is targeted, the better response you’re going to get.

(Okay, it might not be the best kept secret in the history of the world, but a lot of entrepreneurs haven’t yet heard it.)

As a quick anti-example, imagine the response rate you’d get sending a fundraising campaign for the Republican National Committee… to Democrats.

Obviously, it wouldn’t be good.

On the other hand, if you sent that same message to a registered Republican who’s donated to campaigns before, owns his/her own business, makes over $120,000 a year… you’ll do better. And you’ll do better still if you know the specific candidates and issues that your prospect is passionate about, and then shape the message you send around those issues.

And on you could go.

This is list segmentation and target marketing taken to a fairly complex level.

The Importance of List Segmentation

You are guaranteed to increase response to any marketing that you’re doing by tweaking your message to match your prospects’ interests, belief systems, stage in the buying cycle, gender, race, social status, and more.

Of course there are challenges in doing this as well. Determining what kind of segmentation will provide the most leverage can be a mystery, and collecting the data can seem tough. Spending the time or money required to develop a number of ‘tailored’ messages or campaigns looks like a lot of extra work.

But, let’s take a quick look at each.

What Segments Should You Use?

A few factors to consider when defining your segments are:

  1. Each of your segments is definable based on characteristics, behavior, or responses…
  2. Is big enough to warrant developing a strategy around…
  3. Has members that can be motivated to take action…
  4. Is measurable.

Often, the quickest path to achieving the potential that exists with segmentation is to start with:

  1. Segmenting by benefit/interest or…
  2. By point of view or need.

These may seem similar, but they’re not. We’ll use Ontraport’s marketing as an example.

Ontraport software offers a host of different benefits, from email management, multi-channel marketing process automation and rule-based triggers to ROI tracking and testing. In addition, Ontraport offers professional services such as custom data integration and easy-to-use landing page and email design templates.

Not every prospect has an immediate need for every benefit Ontraport offers, so it’s important for us to deliver messaging that highlights how we can solve each individual prospect’s most pressing challenge one-by-one. We do that by segmenting prospects by the benefit or interest that they’re most interested in and crafting messages, offers, and follow-up communication sequences to match.

Similarly, we have different types of prospects with different points of view. Many of our clients are in-house marketers, and others are outside consultants or agencies that install the software for their client or use it to execute and track campaigns on their client’s behalf. These two prospect groups may be interested in the same feature, but for different reasons.

A solopreneur might want to save time or increase response rates by automating certain marketing processes and delivering more targeted messaging, while a consultant may be looking at the same functionality as a way to expand their service offerings. So it’s important to us to know who we’re speaking with to understand their points of view (in our case, based on their type of company), and to deliver a relevant message to each.

Our experience with our own marketing and with thousands of clients has shown that by segmenting based on just these two factors – interest and point of view – and crafting messages and offers to match them, causes an increase in lead conversion of several hundred percent. As we mentioned before, this is just an example… and just a start.

The savviest marketers out there are slicing and dicing their lists far beyond ‘interest’ and ‘position’ because matching message to market gets results.

So How Should You Get the Data?

Once we’ve determined the specific segments that we’d like to start targeting more precisely, we’ve got to figure out how to get the data we need to know who’s who.

How we go about getting the relevant information depends, of course, on what the information is. Whatever information you’re looking for, though, there are basically three ways to get it.

  1. Buy it.
  2. Ask for it.
  3. Infer it.

Buying data can be extremely effective for ‘hard’ demographic information like address, income level, company size, and more. Data collection companies can append your databases with their information and help you find other prospects like the ones you’ve got. Asking for information on web forms is, of course, tried and true. The problem with gathering data online is that asking for anything – even just an email address – can be perceived as pushy or risky and adds significant friction to your conversion process.

In general, the more information you require from prospects online, the fewer responses you’ll get – not to mention visitor’s propensity to use false fill information. Still, asking for data is often necessary and – done right – can be very effective.

There’s also an enormous opportunity to infer important information about your prospects by tracking their behavior. By strategically designing advertisements, websites, landing pages, and email communications in coordination with profiling tools such as those incorporated into Ontraport tracking, it’s possible to learn a vast amount about specific prospects, the quality of your lead sources, and more.

Again, we’ll use Ontraport marketing as an example.

It’s likely that when you came to our website you landed on a page with a Smart Form that asked you to provide your name and email to download this (or some previous piece of) content.

Of course, we offered you information that is relevant to your specific interest and position in exchange for your name, email address and maybe phone number. Using this simple strategy we convert a significantly higher number of visitors than we do if visitors just land on our homepage and have to fend for themselves. Since we store the information you input into your database Contact Record, we also know more about each individual and automatically tailor future communications with you according to your profile.

Surprisingly, most people react to this strategy much differently than you would expect. To understand how people react to it, first, think about the experience you had while making those choices and clicking to the next page. It’s likely that you didn’t feel as pressured or as skeptical about our intentions. Instead, you probably assumed we were simply helping you find the most appropriate content … which is exactly what we were doing.

Some of you may have even felt intrigued by the process and looked forward to finding out what would come next. Consider the vast amount of information gathered from prospects who don’t fill out the form. By tracking the first clicks of that (unfortunately) large group, we get extremely valuable information about the audience makeup of each traffic source. For example, say we sponsor a weekly e-zine and discover that a large number of visitors from that zine are interested in ROI tracking and are inside marketers… but then aren’t filling out the forms. We’ve learned two things:

  1. We’ve found an audience that’s specifically interested in one set of benefits that we offer, so maybe we should test an ad in that e-zine that promotes ROI tracking.
  2. We’ve learned that this particular segment isn’t impressed with the informational offer and are leaving without giving us a chance to re-market to them. We probably ought to improve the offer made to this segment.

Of course, this landing page example is just one tactic that you might use to build prospect profiles from behavior tracking. There are many more.

One Strategy and Five Tactics

So, we’ve laid out the strategy which is: be relevant. We’ve also discussed some tactics you can implement. Here they are again, with a couple more.

  1. Segment your list. If you’re not sure what to start with, try to segment by benefit or point of view.
  2. Gather segmentation data by hook or by crook. Buy it, ask for it, or infer it by tracking behavior.
  3. Use landing page funnels to learn about your prospects and your channels.
  4. Try gathering segmentation data via email by offering multiple content choices and tracking who reads what. Infer interests based on clicks and downloads.
  5. Finally, deliver messaging that reflects what you know about each prospect or client. In order to keep the labor of target marketing to a minimum, you’ll find that it’s critical to automate these processes.

To learn more about how to segment your audience and motivate your prospects to take action, download our free Five Tactics, One Strategy ebook.

About Landon Ray
Ontraport Founder and CEO Landon Ray is a serial entrepreneur whose personal mission is to educate, motivate, and enable others to realize their goals of starting and growing their own business. At the age of 25, Ray transformed himself from a street-corner flower vendor into one of the nation’s top securities day traders in only twelve months. After beating the odds on Wall Street and again during the great recession, Ray has taken his research and personal experience and created Ontraport, a small business automation platform and related family of services, which reflect his passion for educating and supporting entrepreneurs.