Segmentation and Experimentation

August 12, 2019

Corey Talking to a Camera About Segmentation and Experimentation
Featuring Corey Pierson, CEO and Cofounder of Custora

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Whether you're talking about dynamic product personalization where every single customer gets a unique product or you're talking about more of segmenting my base of all customers into something high level.

There are all kinds of different ways that you can segment but it's actually logistically a pain in the butt. You got to get different creatives, you got to plan for the campaign differently. 

I think dynamic product placement is one piece but it is never enough.

Say, 90% of the brands we work with, they really care about the brand and the creative in addition to the product placements. There might be one piece of e-mail that's dynamic SKUs, but there are other parts of the e-mail where they pick the right model. Fall's coming up and I got to get the right model with the dog and the leaves falling and stuff because that captures my fall wear. 

That stuff, you can't personalize for every customer. You can come up with a few different versions that might resonate with a few different segments.

I guess point number one is, there's a place for dynamic one-to-one personalization. There's also a place for segmentation and these things should play nicely together. 

Point number two, though, is then, again, it's up to the senior leadership in these organizations to say: Look, if we want to segment, we have to support it. We need the operational things in place that we are going to triage our customers into two or three primary segments or we're going to invest in different creatives for the brand side. 

We'll personalize SKUs for all of them. That little thing snippet goes in the e-mail. That's cool. We're doing that, but we care about communicating deeply and forging relationships so the brand thing matters too, so I want to invest in the creative.

I also need to invest in the technology that tags customers into those three groups up to date, all the time, so that every single e-mail I send can leverage that stuff. 

I need to test it. Should I segment based on the product category? On the demographic? We need an ability for marketers to be able to test into these things too.

I think the big thing that holds retail organizations back from making progress on things like segmentation is often structure and not having the support, not having the infrastructure to deliver on the creative side, to deliver on the data analytics side, to deliver on the fact that at the end of the day, marketers got to be able to get in there and test and react and try hypotheses and see what works. 

There's a huge opportunity to improve segmentation and, usually, when we talk to brands, where they are in terms of where they could-- There's a lot of low hanging fruit.

There's a lot stuff that is a little less low hanging fruit but with a little bit of investment and restructuring, the impact that you can create on e-mail marketing and other channels is pretty profound.

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