Traditional segments are obsolete in today’s increasingly complex, real-time, and cross-channel world.
This statement can be unnerving to marketers who have long relied on segmentation models as part of the campaign planning process. To be fair, these models were historically sufficient for individual outbound campaigns—because the variables were fixed and clearly defined. Each campaign featured a specific offer that was targeted to a specific customer segment and delivered via a specific channel.
The reality is that customer relationships today are no longer so black and white. Customers communicate with brands using a wide array of channels and devices, often simultaneously. And preferring to control the terms of engagement—and seeking contextually-specific information precisely when and where they need it—they’re relying on inbound channels more than ever before.
According to Forrester Research, Inc., “Legacy segmentation models are no longer relevant to the way customers interact with brands — especially as the number of customer touch-points exponentially increases, creating a non-linear view of the customer.”1
New channels and communication paradigms have stretched segmentation models to the breaking point. In order to drive customer engagement and business results, marketers must embrace a concept we’re calling Zero-Segment Marketing. Eliminating one of the last remaining obstacles to true 1-to-1 marketing, Zero-Segment Marketing discards traditional segments and creates an environment where offer targeting is defined by each individual.
At its heart, the issue is that segmentation must classify individuals in homogenous groups. Yet, customers clearly don’t fit neatly into one bucket—making the process akin to forcing a square peg in a round hole. As a result, marketers are forced to make decisions based on the group, which means that each individual doesn’t receive the best message based on his/her unique profile and response rates continue their decline.
With Zero-Segment Marketing, rather than assigning a specific offer to a specific segment, marketers assign decision criteria to each offer that are shared and consistent across all channels. When a message is generated via an outbound channel or a customer initiates contact with a brand via an inbound channel, these criteria—in conjunction with the customer’s detailed profile—facilitate a real-time recommendation regarding the best offer for that particular individual at that particular time.
Whereas traditional segments are one-to-many or one-to-few at best, Zero-Segment Marketing is truly 1-to-1 and customer-centric, and is the key to increasing engagement and response rates in the age of the empowered customer.
What are your thoughts on the term Zero-Segment Marketing? Leave a comment below.
