In theory, four simple steps will lead to increased response rates:
- Select the target group
By selecting one or more characteristics for segmentation, you ensure that all the members of the target group have ‘something in common’.
- Customise the message
That ‘something in common’ then becomes the focus for the offer. You can now customise the body copy of your message.
- Focused promotions bring higher response rates
Because the target group is clearly-defined, the result will be a proportionally higher response rate.
- Relevance adds up-lift
Because the message is customised to ensure high relevance, there may well be an additional uplift in actual responses.
In practice, you’ll get greater effectiveness – but a smaller volume of successes.
Suppose you can actually identify the ideal ‘Pareto segment’ – a characteristic that identifies the 20% of the contacts who account for 80% of the positive results. What then?
- Since the target group is just 20% of its previous size, the successful responses will certainly represent a higher percentage rate.
- But the fact remains: the quantity of successful responses will still be down by 20%.
At this point you may be asking yourself “so why bother?”
The answer is that you don’t do segmentation to gain a larger quantity of responses from a single offer.
You do segmentation to optimise the total quantity of responses that you get from multiple offers.