What is Targeted Marketing? Benefits, Strategies, and Examples

By Caitlin Seele

What separates good marketers from great marketers? A sense of curiosity.

The best marketers ask questions constantly. What would happen if we change this copy? What about sending our newsletter on a different day? Or how about trying a new channel altogether?

But before getting into any talk about tactics or channels, the first question that great marketers learn to ask (and one you’ve probably heard in a recent meeting) is: Who are we talking to here?

No matter what products or services you sell, you can’t be everything to everyone. You have a defined audience — a set of people that care about and benefit from what you do.

That’s where targeted marketing comes in. Today, we’re going to be covering what targeted marketing is, ways to segment your target audiences, targeted marketing strategies, and more.

Let’s get into it ⚡️

What Is Targeted Marketing?

Targeted marketing is a strategy that uses data to inform and execute campaigns that are personalized to specific segments of your audience. This not only streamlines your marketing efforts but also makes your prospects feel heard.

Today’s buyers are much more likely to respond to a personalized campaign than a generic one. In fact, they’ve come to expect it: 83% of customers are willing to share their data to receive a more personalized experience. In short, consumers are well aware that, when they give you their email address, phone number, or other personal information, you’re going to use it — and they expect a better experience in return.

Yet 57% of marketing and sales leaders say they are unhappy with their company’s current personalization strategy, with many struggling with inefficiencies and lack of scalability. This is where segmentation can help create an experience that speaks to your target audience and drive more conversations.

Segmentation in Targeted Marketing

To unlock the power of targeted marketing campaigns, you first have to define your audience. In targeted marketing, segmentation is the practice of using data to separate your audience into smaller pieces and then crafting messaging and campaigns accordingly.

There’s no right or wrong way to segment your audience. Think instead about the campaign you want to run and how it’s going to resonate with different parts of your audience. This is also where you’ll consider if there are ways to adapt and personalize your campaigns based on who your audience is.

Here are the five main types of data you can use for segmenting your targeted marketing campaigns:

1. Demographic Segmentation

Demographic data is the most common type of segmentation data marketers use. When we talk about demographic data, we’re talking about the baseline information. This includes:

  • Age
  • Gender
  • Occupation
  • Education

In a way, demographic data is the simplest way to segment your audience, and it’s often a starting point for designing a campaign.

For industries like retail, this information can be highly relevant. For example, demographic information might give you a clue about what kinds of clothes or shoes someone of the same age or gender is likely to purchase. (And that’s why sadly, they don’t make light-up velcro sneakers in my size.)

2. Firmographic Segmentation

B2B companies are more likely to use firmographic data — demographic data’s cousin. While these two kinds of data are similar, rather than describing a group of people, firmographic data describes a group of companies. Companies are often grouped by:

  • Company size
  • Location
  • Annual revenue
  • Industry
  • Funding

Firmographic data helps you build a landscape of target accounts based on their propensity to buy. Unlike demographic data, this has more to do with how well a buyer aligns with your ideal customer profile (ICP). In other words, firmographic data informs you whether or not a company will find significant success with your solution — therefore making them more likely to buy.

3. Geographic Segmentation

Geographic data uses location services in order to create more targeted campaigns. Once you know the city, town, or region that your buyer is from, you can better tailor your campaigns to them. Here, you can use:

  • Language
  • Time zone
  • Urban vs. rural
  • Climate and weather
  • Local events

If you’ve ever been frustrated by advertisers promoting winter parkas when it rarely drops below 60 degrees year round (yup, that happens to me in San Francisco), then it’s because they’re not using geographic data to their advantage.

4. Psychographic Segmentation

So far, we’ve talked a lot about data that only goes skin-deep. Psychographic data adds a qualitative layer to your campaigns by examining the emotional and personal traits that make a person whole. This includes:

  • Values
  • Lifestyle
  • Character traits
  • Interests and hobbies
  • Attitudes

While on the surface this seems unnecessary to some businesses, it’s psychographic data that provides a deeper context for a person or group of people that may not look similar on paper. Personalizing your campaigns with this kind of data is what will separate your campaigns from everyone else.

5. Behavioral Segmentation

So far, we’ve discussed types of data that speak to the theoretical nature of marketing. All of this data requires you to make an educated guess about whether or not a given message or channel will work for a 30-something working parent or a seasoned sales executive (and they may be the same person!).

But there’s one type of data that doesn’t require any guesswork. Behavioral data is collected when a customer or prospect interacts with your business in some way. This might be:

  • Time spent on a website and pages browsed
  • Likes and comments on social media
  • Content downloads
  • Email clicks or replies
  • Chat history
  • Purchase history

What makes behavioral data so valuable is that, when combined with other forms of data, you can accurately gauge an individual’s intent to purchase — AKA how ready they are to pull out that credit card. Though with the imminent loss of third-party cookies, it’s critical that you have systems in place that collect first-party data, i.e. data that is willingly given to you through interactions on your own website.

An Example of a Targeted Marketing Strategy

You can use targeted marketing in every single area of your marketing efforts, in every channel. Targeted email, targeted social media, targeted advertising, and targeted content are all examples of targeted marketing strategies.

Before you personalize every [first name] opportunity, though, you need to think holistically about your funnel. At Drift, we use a Conversational Marketing framework to build our targeted marketing campaigns:

1. Engage Leads with Personalization

This goes way beyond opening an email with “hi, [first name].”

You want to engage your leads when they’re engaging with you. With Conversational Marketing, when a visitor clicks download, asks to contact sales, or books a demo with you, jumpstart the conversation by immediately reaching out to them while they’re on your website.

Of course, you can’t have someone operating your live chat 24/7. At Drift, we use intelligent chatbots that allow you to have targeted conversations with website visitors at any time of day.

From there, you can start to move them down the funnel with other targeted offers, like using personalization to tailor a follow-up email or specific targeted ads using their email address (or other information you collect during your chat.)

2. Understand Their Key Pain Points

The next phase of targeted marketing strategy is adding that layer of psychographic data to your information. You already know they’re interested in what you have to say if they’ve visited your website or chatted with you. Now, it’s time to dial in specifically what they want — maybe it’s a certain feature or product — and how you can solve them. The more detailed and personalized these touchpoints are, the more trust you can build between you and your prospect.

A typical qualifying process can take days. With Conversational Marketing software, bots ask qualifying questions, determine if a lead isn’t interested, or flag a lead for a sales follow-up based on what information they’re looking for and what questions they ask.

3. Recommend Next Steps

Digital channels will only take you so far. That’s why bots use intelligent routing to connect leads to your sales team and automatically book meetings for them — so your reps can focus on selling.

Or if they’re not ready, they can recommend relevant blogs to browse, events to attend, or other ways to engage with your company in a personalized way until it’s time to commit.

What Makes Targeted Marketing So Effective?

Targeted marketing isn’t just a playbook for increasing engagement and driving conversions (though it certainly works that way). It’s a way of thinking differently about your audience and your channels so that you’re aligning your buyer’s needs and wants with what you’re offering.

Crafting targeted marketing campaigns takes practice. And it’s a lot of effort.

But we live in an era of hyper-personalization: 74% of customers expect brands to understand their unique needs and expectations. Plus, the cost of not creating a personalized, tailored experience is something your business just can’t afford. According to McKinsey, companies that personalize their buying experience can increase their revenue by 5-15% and reduce acquisition costs by 50%.

Ultimately, you want to make it as easy as possible for your buyers to buy from you. And targeted marketing is what will make that happen.

Level Up Your Targeted Marketing with Drift

When you have all the data and strategies to do targeted marketing effectively, you can craft marketing campaigns that truly speak to your buyers and customers.

But what if you could speak to them literally?

Drift Conversation Cloud is the tool you need to amplify your targeted marketing. With custom chatbots and live chat, you can enhance any campaign with personalized and relevant real-time conversations. Plus, these conversations offer a wealth of data that will help you create better segmentation and targeted campaigns as more time passes. Get a demo today.

Looking to create an even more personalized experience that converts? Check out our ABM playbook, Personalization That Actually Feels Personal, to learn about the power of one-to-one marketing.