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

Getting your business ready for the Entrepreneurial Consumer

We all know the digital revolution has completely transformed the way consumers are interacting with brands, and that a lot of businesses are finding it hard to catch up. One way to closing this brand gap is to understand consumer behaviour and build a brand experience that meets these new needs.

Pip Stocks

CEO and founder, BrandHook

Brand management starts with management

As the world continues to grow and evolve, it’s more important than ever to build a strong brand that articulates your message clearly and consistently, stands out against the noise, and develops relevance with the people that matter. This makes managing your brand a key component to gaining cut-through and ultimately business success.

Dan Ratner

managing director, Uberbrand

Disrupting marketing as we know it

Call it digital disruption or the fourth industrial revolution, our rapidly evolving environment is affecting consumer perceptions, purchase behaviours and the way they consume information and products.

Jean-Luc Ambrosi

Author, marketer

Very interesting article which touches on the importance of a feedback loop fuelled by customer and market insights. Ideally this scenari...

Andrew Reid

Building customer insights in the data and digital age

Read more

Very very good piece- very novel and innovative and very possibly- effective - way to look at one's communication headlines!

Patrick Dsouza

Should your disclaimer become your headline? - Brand science - CMO Australia

Read more

Excellent post Rob, Mobile app users are growing day by day. Everyday lots of apps are launched in the market but not every app retains t...

Marcus Miller

Why app engagement must be personalised - Mobile strategy - CMO Australia

Read more

very informative blog. I really like the information given in this blog.http://gng.com.au/

Gajanand Choudhary

The evolving role of the CMO - The CMO view - CMO Australia

Read more

It is true That’s the new read following up Deloitte Digital's Digital disruption - Short Fuse, blowup analysis series, that appearance t...

miller645645@mail.ru

Digital disruption about to impact health, education sectors

Read more

Latest Podcast

More podcasts

Sign in