Many retailers perceive email and SMS marketing as merely a means to create sales opportunities or build brand awareness. But smart retailers know that creating memorable, personalised interactions can foster long-term customer loyalty by building genuine engaged relationships with customers.
By using audience segmentation, retailers can create experiences that surprise and delight customers, turning them into raving fans.
Klaviyo has the statistics to prove it: highly segmented campaigns return more than three times the revenue per recipient compared to unsegmented campaigns.
Using segmentation, retailers can group their contacts into ultra-precise audiences that update in real time so they stay relevant. Messages via email or SMS can be targeted based on customers’ latest shopping behaviour, customer data – and even using predictive analytics.
Audience segmentation can start with the basics: new purchasers of products, inactive or unengaged subscribers who have been on your list for at least six months but have never opened or clicked an email, VIP customers and customers in the ‘pre-VIP’ stage, who have a high predicted customer lifetime value.
Retailers can then use Klaviyo’s segmentation tool to drill down into even more clearly defined audiences based on factors such as past purchasing and browsing behaviour on the website. By using Klaviyo’s predictive analytics tool, retailers can forecast what products or deals customer segments may be open to promotions for.
Klaviyo offers retailers an online code-free segment builder that marketers can easily use. The tool goes beyond the basic demographic profiles, so messages can target customers based on factors like specific purchases, their use of discount codes, and predicted customer lifetime value.
Retailers who have successfully deployed segmentation with Klaviyo include apparel brand Taylor Stitch, which saw a 60 per cent increase in revenue per recipient – and a 60 per cent reduction in unsubscribes.
The retailer of men’s and women’s clothing allows customers to choose between purchasing ready-made clothing or crowdfunding new designs through a program it calls Workshop.
Mike Grasewicz, director of marketing at Taylor Stitch says that before the company deployed Klaviyo’s marketing solution, the retailer felt like it was sending everyone the same emails in the dark without understanding purchase history or preferences.
“People have different purchasing behaviours. We don’t want to send everyone the same set of emails.”
As a first step, Grasewicz realised it had to assemble and sort its data that had previously been siloed across different parts of the business. Then he used the segment builder to divide his master list into groups for different email campaigns, methodically recording his results before weeding out less engaged email subscribers.
“A lot of people just stop opening emails. They might as well have unsubscribed, but they’re still on your list. And sending emails to people like that yielded super-low click rates, super-low open rates, and not a lot of revenue.”
Next, he started testing, sending an email related to Workshop to two segments that would help him better understand questions around email cadence and customer behaviour.
“The first send went to a highly engaged segment: people who had actively browsed our site or opened more than three emails in the past 180 days,” he says. “The second went to the rest of our list, which was double the size.”
The differences between the two segments stunned him: the active segment achieved a 40 per cent open rate, 3 per cent click-through and 36 purchases. The second segment had an open rate of just 11 per cent, a click-through rate of 0.5 per cent and zero purchases.
Subsequently, by using Klaviyo regularly to divide his master email list into groups with shared behaviours, Taylor Stitch was able to start sending more relevant messages – and stop sending them to people who weren’t interested.
“At the time, I didn’t even realise the potential for segmentation,” recalls Grasewicz. “I just wanted a more holistic view of how our emails were performing and who our customers were.”
Taylor Stitch now builds around 40-50 detailed segments a month using Klaviyo’s tools. “We take an hour at the beginning of the month and an hour in the middle of the month to make all these segments, which may look extremely complicated at first glance, but when you dig in, it’s the same logic-based idea for each product.
“It’s some of the most productive hours we spend each month,” Grasewicz says. ”It’s led to an increase of almost 60 per cent in revenue per recipient. And with Klaviyo’s segmentation capability, I’m able to hindsight each week’s strategy and see if there was something we missed or could have improved on.”
Another retailer to deploy personalisation in its email and SMS marketing using Klaviyo’s tools is The Messi Store, the lifestyle and apparel brand of soccer legend Leo Messi.
With 492 million followers on Instagram, Messi has a massive database of potential customers, but – as the company discovered in the early days of its email marketing campaigns with a different partner – mass emails are counterproductive, driving unsubscribes and spam complaints when customers receive communications about products that are irrelevant to them.
This year, The Messi Store adopted a personalisation focus to its digital marketing campaigns.
“There’s so much noise in everyone’s inboxes – you’re only going to click on what’s relevant to you at the moment,” says Elcee Vargas, lead product marketing manager at Klaviyo. “That’s universal across any industry.”
Menswear brand Ministry of Supply was another convert when it leapt into women’s fashion. Its challenge: how could it show its increasingly diverse subscribers the most relevant apparel in marketing messages?
Senior marketing manager Colleen Maloney and her team started segmenting one email campaign per week by gender after first adding consumers’ self-reported gender to its database, via a pop-up online and using Klaviyo’s predictive analytics tool to identify customers who have not reported their gender.
Now, for that weekly send, “the content or even just the subject line, is more specific to the gender that the subscriber is shopping for,” says Maloney.
Segmentation has driven 36.2 per cent year-on-year revenue growth from email for Ministry of Supply, and 47.3 per cent year-on-year growth in revenue from omnichannel campaigns since it started using Klaviyo predictive analytics.
There is no one-size-fits-all customer journey for retailers to follow – personalisation of the brand experience is how a customer or a potential customer wants to interact with you.
But, of course, you can’t personalise on a one-to-one basis. It needs to be one-to-many. That’s where Klaviyo’s intelligent marketing automation platform can help retailers develop segmentation solutions to power smarter digital relationships.
Klaviyo (CLAY-vee-oh) powers smarter digital relationships, making it easy for businesses to capture, store, analyse, and predictively use their own data to drive measurable, high-value outcomes. Klaviyo’s modern and intuitive SaaS platform enables business users of any skill level to harness their first-party data from more than 300 integrations to send the right message at the right time across email, SMS, and push notifications. Innovative businesses like Frank Green, Saba, Budgy Smuggler, Who Gives A Crap, and more than 130,000 other paying users leverage Klaviyo to acquire, engage, and retain customers – and grow on their own terms.