Why Ozsale believes customer segmentation can go too far

Australian online retailer's marketing team talks about why relevancy, and not segmentation, should be the focus for data-driven marketing

While customer segmentation has become something of a mantra for data-driven marketers, few would suspect it’s also possible to take segmentation one step too far.

It certainly wasn’t an outcome that was expected by the flash sales company, Ozsale. The business uses an email-driven model to help fashion brands sell excess or surplus inventory to a database mainly comprised of women.

Ozsale’s original model had been to send the same email to every customer, but the purchase of analytics and campaign management technology from Alterian (since acquired by SDL) gave it a greater ability to capture customer data and use that to create more targeted customer segments.

But according to chief executive of the APAC sale group, Carl Jackson, creating smaller and smaller customer segments based on behaviour led the company to reduce the range of offers it was sending to those customers.

“We went to a point where we went very granular, and dropped off some of the other stuff,” Jackson says. “And that had an impact – we stopped sending as many emails.”

While it is a common desire among email marketers to reduce the volume of email in favour of more highly-targeted communications, this can lead to a reduction in overall sales, as customers are seeing less content.

“We’ve since stepped back from that a little bit and are now offering personalised, relevant content but to a very, very broad customer segment,” Jackson says.

Today, Jackson says it is relevancy that is the goal of Ozsale, rather than highly-targeted customer segmentation. The company has developed six broad categories, ensuring it is able to make offers of products identified in adjacent categories to what customers have purchased previously.

Ozsale has clearly got the balance right, and is now sending offers to 8.5 million email addresses across six countries in the APAC region, and is set to expand further. The SDL tools enable it to capture a wide range of behavioural data, from click throughs and purchasing data to measures of how long customers spend hovering over certain offers.

Even so, Jackson says he is taking a cautious approach to how far he pushes the technology, particularly regarding those possibilities around its core activities in email marketing.

“We’ve gone through explosive growth, and there is lots of great stuff out there,” he says. “But we have been very focused on doing the things that work, and not getting distracted around the other channels and the other pieces of engagement.

“And tempting as it is to do lots of nice things, we stayed very focused on our email segmentation and our email targeting.”

Follow CMO on Twitter: @CMOAustralia, take part in the CMO Australia conversation on LinkedIn: CMO Australia, or join us on Facebook: https://www.facebook.com/CMOAustralia

Signup to CMO’s new email newsletter to receive your weekly dose of targeted content for the modern marketing chief.

Join the CMO newsletter!

Error: Please check your email address.
Show Comments

Supporting Association

Blog Posts

Why there’s more to content marketing ROI than just numbers

Most brands are producing more content than ever before. Even those still operating predominantly in campaign mode are finding social media demands an always-on content pipeline.

Jacki James

strategic planner, Zuni

Six lessons from Mobilegeddon

Google’s Mobilegeddon is the lesson many big companies and their marketers are learning the hard way.

Rob Marston

Managing director, Zeus Unwired

Against Net Promoter: A new way of interpreting the customer data deluge

One thing that frustrates marketers is the sloppy use of digital research.

Jason Juma-Ross

lead partner, PwC Digital Intelligence

The next Advertising medium is Augmented Reality, Just when individuals thought promotions couldn't get any more interactive and close to...

Siddhu

The old billboard gets the flick as digital OOH advertising takes over

Read more

Augmented Reality is the most immersive and interactive medium at today and that works for all kinds of real world requirements. It allow...

Siddhu

Sunny Queen launches egg-citing augmented reality collectible cards

Read more

It's really helpful that you were able to share this kind of information in order for some people to know on what is this kind of word re...

best essay sites

It's time for CMOs to embrace ‘agile’ as a noun - Technology chief - CMO Australia

Read more

You nailed it Mark, not nice, not popular but true.

CruiseFactoryData

CMO Council: Marketers lack right customer metrics for digital transformation

Read more

An insightful post and I wholeheartedly agree that without clearly defined business goals any content strategy will be ineffective. The d...

Alastair Kane

Why there’s more to content marketing ROI than just numbers

Read more

Sign in