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Types Of Audience Segmentation, Examples And Unique Case Studies Do you ever notice the vegan or gluten-free options on the restaurant menu when placing an order? Or the ‘student special’ option at the coffee shop? You would agree with me that these ‘separations’ make it easy to sell to these specific groups of people. As a business owner whose primary goal is to sell, using this powerful marketing tactic could be the fine line between steady progress and exponential growth. Source: Freepik In this blog post, you will get to understand why audience segmentation is important for your business, the various types of audience segmentation with relatable examples, and how mastering audience segmentation can improve your marketing efforts (with HubSpot Academy as a case study). What is Audience Segmentation? Simply put, audience segmentation is sorting your target audience into different groups based on specific criteria or shared characteristics. This helps you create content or craft brand messaging that resonates better with each group. Why is Audience Segmentation Important? The more you streamline your audience, the easier it is to identify your different audience segments, and the better you can tailor content, brand messaging, and marketing efforts to different target audiences. Here's how this works. Let's say you step on a platform in the middle of a stadium to verbally pass a message. You're talking to everyone at the same time, yet no one in particular. Everyone hears you, a good number of people listen, but only a sprinkling of people feel you're talking to them. Segmenting your audience ensures you send tailored messages to a specific person or group. This builds better connections and increases their tendency to take action. Types of Audience Segmentation Your target audience can be segregated using different criteria; from their location, age, earning power, and hobbies, to habitual criteria like things they do for fun and how they like to spend their evenings. Some major types of audience segmentation include; Demographic Segmentation Demographic segmentation is based on audience characteristics such as age, gender, occupation, educational level, marital status, physical location, family size, and so on. It involves grouping your audience based on factual/documented information about this. For instance, you could design a gym wear line for women - here your audience segmentation is based on gender. Or a set of apartment outlets that are priced based on your buyer's income level—for instance, you could have apartments for high-income earners and budget-friendly options for students. Note that segmentation based on physical location can sometimes be exclusively called geographic segmentation, depending on marketing needs. Geographical segmentation considers regional needs and preferences. For instance, a clothing brand launching a new line of coats and sweatshirts would typically target the colder regions, and one that produces hiking boots would target mountainous regions. Demographic segmentation is the most common type of audience segmentation and is a good starting point for streamlining your target audience. Psychographic Segmentation Psychographic segmentation is based on the psychological and lifestyle characteristics of your audience. Here, you segment the audience according to their interests, beliefs, values, lifestyle, and personality. For instance, a massage therapist targets people who value a balance between work and relaxation. Or a skincare brand with a line of cruelty-free and eco-friendly products for eco-conscious people. Another example is a high-end jewelry brand that targets people with a luxury lifestyle. This type of segmentation requires a deep understanding of your audience to effectively tailor your brand messaging to resonate with their values and interests. A marketer who has mastered psychographic segmentation can effortlessly use the emotional triggers that influence a customer's decision to buy. Behavioral Segmentation As the term states, behavioral segmentation goes beyond gender and interests, and focuses on a customer's behavior. Here, customers are grouped based on their purchase history, browsing history, social media activity, and website or app usage. This audience segment targets people that are already interested in, and would most likely buy your products/services. For instance: if you're an online shopper who loves to shop household appliances, you're less likely to get ads for running shoes. This is because e-commerce stores target people for ads based on their purchase history. Behavioral segmentation uses past actions, interactions, and behavioral patterns to predict buying patterns and preferences. By analyzing customer behavior patterns, marketers and business owners can identify customer pain points, and develop targeted solutions aimed at guiding customers down the sales funnel and improving conversion. Although these are the major audience segments, there are other types of target audience segmentation. Aside from age, values, and shopping habits, you can segment audiences based on the kind of devices they use, their specific needs, or their position in the customer lifecycle. Demographic segmentation vs Psychographic segmentation These are the most common types of audience segmentation and they are usually carried out simultaneously. Demographics focuses on facts like age, gender, and income, whereas psychographics highlights a person’s mental orientation and idiosyncrasy. Take the case of the massage therapist for instance. While his psychographics target people who value a balance between work and relaxation, his audience segment for demographics could be 18-40, working corporate jobs with a yearly income of $30,000 and above. Notice that there could be people within the specified age range that earn about $15000-$20000. However, these groups of people may not be able to afford the services, so targeting them would be counterproductive. This is why it is important to know how to carry out audience segmentation properly. Audience Segmentation Examples Coca-Cola Coca-Cola focuses on four types of audience segmentation; demographic, geographic, psychographic, and behavioral. Demographic: Coca-Cola targets people between the ages of 18-45+, including children, youths, and middle-aged adults. They also have family-sized packs and different product sizes with varying prices to cater to various income levels. Also, Coca-Cola tailors brand messaging and marketing to regions. You’ll notice this in how Coca-Cola sells refreshment and hydration in hot and sunny areas. They also tailor soda varieties per region. For example, the cherry-flavored variant of Coca-Cola is only available in certain areas. Psychographic: We all know Coca-Cola as a ‘feel-good’ brand. Hence, they are focused on selling positive emotions like happiness and togetherness. They also target people who are health-conscious with their sugar-free options, and sport-oriented individuals with their handy bottle sizes and promise for refreshment. Behavioral: Coca-Cola leverages the tendency of customers to have a drink with a meal or at a party. Amazon Demographic: Amazon caters to a wide range of audiences from 18 – 60 years. However, they focus on middle-aged individuals with a comfortable household income of nearly $85,000, who are more likely to spend money. They also have a fast and free shipping feature targeted to those whose locations are far from Amazon's physical stores. Psychographic: Amazon’s competitive pricing, fast delivery, and hassle-free return policies target customers who prioritize convenience. Behavioral: Like other e-commerce sites, Amazon tracks buyers’ browsing and purchase history, gives personalized recommendations, and displays targeted ads based on a customer’s buying habits. Also, the availability of desired products, with the free shipping feature that Amazon Prime offers caters to frequent and habitual online shoppers. Netflix Demographic: Netflix demographics consist mainly of Gen Zs and millennials, and content recommendations are made based on age group preferences. Due to a family-friendly feature that allows multiple profiles on a single account, Netflix might tailor recommendations for different age groups based on each profile's ‘watch history’. Most Netflix subscribers are from North America, Europe, Africa, and the Middle East. Psychographic: Netflix appeals to an audience with a wide range of personal preferences—romcoms, comedies, action, thrillers, or even eerie murder documentaries. Behavioral: Netflix recommends shows based on individual attention span and preferred content length. This information is derived from your viewing habits and the average time you spend watching a show. In addition, Netflix subscribers are known for sharing their passwords and watching shows with their pets. Starbucks Demographic: Starbucks demographics include male and female, highly educated professionals, and students aged 22-60 years. They target the middle to upper class and serve as the go-to coffee spot for a coffee date, or a morning latte grab on the way to work. Starbucks also tailors its menu to the regional preferences and flavors in its physical location. Psychographic: Starbucks caters to people who are eco-conscious and committed to sustainability. You can see this in their reusable cup program that aims to replace disposable cups and position them as the sustainability leader in Seattle. They also target people who value quality coffee, and a comfortable welcoming space to work or study away from work or home. Behavioral: A good number of Starbucks customers visit the store regularly, and a majority of their purchases are order pickups and drive-throughs. How can Audience Segmentation Enhance Your Inbound Marketing Efforts? According to the Digital Marketing Institute, inbound marketing is the strategic marketing approach that involves building meaningful connections and fostering lasting relationships with your customers. It uses an attract-engage-delight model that revolves around your content strategy. Now let’s fix the piece of the puzzle together. Grouping your target audience into audience segments allows you to connect with, attract, and delight each audience segment with content targeted to cater to their specific need. Let's take HubSpot as a case study; HubSpot Academy recognized that its target audience was made up of marketing professionals with different experience levels, hence, they segmented their audience using two major criteria. - Buyer's Journey Stage: Their audience was segmented into professionals in different stages of the customer's journey—awareness stage consideration and decision stages. The more experienced their audience is, the higher they are in the customer journey map. For example, a beginner in marketing will want more understanding of certain marketing concepts (awareness stage) while a professional with years of experience will need a marketing tool (decision stage). - Marketing Role: Their audience was further grouped by specific marketing roles, such as content marketing managers, social media managers, email marketers, or SEO specialists. By grouping their audience this way, HubSpot could tailor their content to address each audience’s needs at different experience levels. Here's what they did: - They created blog posts targeted at each stage of the buyer's journey. For beginners, they offered "What is Inbound Marketing?" guides. For those in the consideration stage, they had in-depth articles comparing different marketing automation platforms. And, for those in the decision stage, they provided case studies and demos of HubSpot's software. - Each blog post has CTAs relevant to the specific audience segment. For beginners, it's a link to download a free marketing ebook or template. For those in the decision stage, it's a free trial offer for HubSpot's software. The Result - Significant Increase in Web Traffic. Visitors found HubSpot content more relevant to their needs, so, they spent more time on the website and became regular visitors. - Improved Lead Generation & conversion: Remember that HubSpot personalized their CTAs based on their audience segments. This led to a higher conversion rate of blog readers into qualified leads and finally paying customers. From this case study, it is evident that meeting your different audience segments at their pain point with a salve will move them from strangers to prospects, to customers, and finally to brand loyalists faster than a racing bullet. In Conclusion People respond better to messages tailored to their needs and interests; no one appreciates a solution thrown generally to the crowd. Like HubSpot Academy, properly segmenting your audience and tailoring your strategies, content, and CTAs will attract more customers who connect with the solution you're providing, generate more leads, and ultimately convert those leads.