Market segmentation is a marketing method that resonates more effectively with recipients, potentially increasing engagement and fostering better health outcomes. Backed by the fact that 70% of marketers use market segmentation and 80% of those report increased sales, segmentation can drive success in marketing campaigns.
Introduction to market segmentation
The source of market segmentation can be traced back to the 20th century. A seminal article written by Wendell R Smith is often credited with coining the concept that has since grown into veritable marketing strategy across multiple sectors.
"Businesses from all industry sectors use market segmentation in their marketing and strategic planning. For many, market segmentation is regarded as the panacea of modern marketing (Wind, 1978). Both the underlying logic and the rewards which segmentation offers are well established in the literature. Customer needs are becoming increasingly diverse. These needs can no longer be satisfied by a mass marketing approach. Businesses can cope with this diversity by grouping customers with similar requirements and buying behaviour into segments. Choices about which segments are the most appropriate to serve can then be made, thus making the best of finite resources."
The above study posed the central question of what makes market segmentation work can be used despite its potential for failure. Market segmentation is a process involving the division of existing and potential customers (or patients) into subgroups or segments. This approach works because it allows organizations to understand customers better. This understanding allows them to leverage customer wants and needs to increase engagement, satisfaction, and loyalty.
As mentioned in the excerpt, markets are as evolving as people. In this regard, one of the central benefits of market segmentation is its dynamic nature. It allows organizations to navigate and alter their marketing strategies quickly according to the constant changes in the needs of the markets they have corners in and those they want to join.
See also: Email marketing segmentation strategies in healthcare
The use of market segmentation in HIPAA compliant email marketing strategies
Marketing segmentation divides patients into distinct categories based on nonsensitive characteristics such as demographic details (e.g., age, gender, location), behavioral patterns (e.g., website interactions, service usage history), and psychographic factors (e.g., lifestyle, values). This data in a healthcare organization would be considered protected health information (PHI) and, therefore, needs to be collected with patient consent and understanding of its purpose. This is especially true for behavioral patterns that are often sourced from online tracking technologies which has been the source of recent debate.
Once compliance is met this information can be a source of highly personalized and targeted HIPAA complaint email marketing strategies. For example, a healthcare provider could segment its audience into categories like young adults, seniors, or families, and tailor health tips, service announcements, and educational content according to the interests and needs specific to each group. Patients who feel like communications are not mass distributions but aimed at their needs are more likely to respond. This is reflected in an increase in open rates to an average of 20.66%. With the increase in relevant metrics such as open rates and engagement, organizations can see a potential increase in the return on investment from their email marketing strategies.
How to apply marketing segmentation strategies without violating HIPAA
- Understand HIPAA's rules about marketing: HIPAA requires that any marketing strategy, including any segmentation strategy cannot reveal, use, or reference PHI without consent.
- Identify non-sensitive segmentation bases: The key to HIPAA compliant segmentation is to use non-sensitive information to divide your audience. These criteria allow marketers to tailor their messages without needing to access or utilize PHI.
- Use HIPAA marketing tools like Paubox Marketing: Paubox offers built-in features designed to protect patient privacy, making them suitable for deploying segmented marketing campaigns.
- Obtain and document consent: Make sure that the consent process is clear, giving patients with information on how their data will be used and their rights to opt out or withdraw consent.
- Use aggregated data for insights: Use aggregated data to gain insights into patient behaviors and preferences. Aggregated data can inform your segmentation strategy without violating HIPAA regulations.
See also: HIPAA Compliant Email: The Definitive Guide
FAQs
What is advanced segmentation in email marketing?
This refers to creating highly specific groups within your audience based on a set of nested conditions, like purchase activity, gender, or age. It allows for more targeted and efficient campaigns.
What is segmentation in marketing strategy?
Segmentation in marketing strategy involves dividing a broader market into smaller groups of consumers with similar needs or characteristics to tailor marketing efforts more effectively.
What is the most effective email marketing campaign strategy?
This strategy uses personalization and segmentation to send relevant, customized messages to different audience segments, significantly enhancing engagement and conversion rates.
Kirsten Peremore
