AI for Market Segmentation: Creating Highly Targeted Campaigns 

Market segmentation is a core concept in marketing strategy promotion. Breaking a large consumer or business market into specific segments of consumers with similar characteristics helps companies direct their marketing efforts and strategies to meet their customers’ needs and expectations. It improves customer satisfaction and enhances the outcomes of marketing communications activities. Without market segmentation, creating targeted campaigns is a distant dream. 

According to a report by Salesforce, 69% of customers expect businesses to know their likes and preferences, while 76% of B2B buyers expect the same. Therefore, in today’s stiff competition, it’s crucial to understand and address the specific needs of your customers. And market segmentation will help your business to: 

• Create personalized marketing communications that resonate with your target audience. 
• Enhance customer engagement and boost loyalty with repeat business. 
• Optimally use your resources to make unparalleled profits. 
• Improve your product/service development by identifying the gaps in the market and creating opportunities. 

What is Market Segmentation?

Market segmentation is partitioning a huge market made up of consumers or businesses into subgroups with a particular characteristic. These characteristics can comprise demography, interests, needs, or behavior patterns. Segmentation aims to open up new possibilities for using key marketing tools more selectively. 

For example, a firm selling sporting equipment may classify its market in terms of the performance level of the buyers as professional athletes, health-conscious clients who exercise frequently, and the occasional exercisers. Each of them, in turn, has its own peculiarities and expectations from receiving some marketing messages and/or offers. 

How AI is Revolutionizing Market Segmentation? 

One of the most revolutionary fields offering new methods to business organizations for implementing the concept of market segmentation is Artificial Intelligence (AI). The traditional approaches were confined to mainly quantifiable data and broad data classification, not to mention that the processes were done manually. AI, in contrast, works with large amounts of data and uses complex algorithms to extract information about situations and outcomes that are impossible for a person to understand. 

Here are the benefits of AI-driven market segmentation. 

1. AI uses and analyses advanced datasets, including behavioral, psychological, and transactional data, to learn about customers’ preferences. 
2. AI processes real-time information, allowing businesses to adapt according to market conditions. 
3. AI uses predictive analytics to forecast future trends. 
4. AI minimizes human error and automates most of the routine tasks. 

Now, let’s talk about the significance of highly-targeted campaigns. 

What are Highly Targeted Campaigns? 

Highly targeted campaigns are marketing initiatives personalized to specific niches discovered with the help of profound AI-based segmentation. These campaigns focus on reaching the appropriate audience with the correct message at the proper time to gain the most exposure and client conversion. 

Here are the key components of highly-targeted campaigns. 

1. Create personalized content that speaks directly to each segment and sub-segment of your target audience. 
2. Use the most effective communication channels, including email, social media, etc.  
3. Use dynamic messaging to curate your marketing communications in real-time based on customer interactions and choices. 
4. Frequently monitor your campaign performance to improve the results. 

What is the Role of AI in Market Segmentation? 

AI can be defined as the attempt by computer systems and machines to mimic the intelligent behavior of human beings. Machine learning is one category of AI in which the computer is given algorithms and statistical models to optimize its performance based on experience. 

AI and machine learning can handle a large amount of data, analyze it, and make informed decisions quickly. For this reason, AI is a versatile technology that can be used in different fields, including market segmentation. 

Using AI for customer segmentation can help you in the following ways. 

1. AI minimizes human errors and gives accurate results. 
2. AI offers deep insights into the behavior and preferences of your potential customers. 
3. AI improves the ROI by targeting the right audience. 
4. AI reduces the cost of manual labor. One person with an AI-powered tool can do the job for you. 
5. AI can help you scale your datasets whenever you want. 
6. AI offers you a competitive advantage in being quick and changing according to your customers’ needs. 

How to Create Highly Targeted Campaigns? 

Here are three easy ways to create a highly targeted campaign for your business needs. 

1. Define your target audience with the help of AI.

AI contributes greatly to defining target audiences by compiling massive data and searching for patterns. In the past, the audience was often defined only by its demographic characteristics or assumptions. There was no other way. On the other hand, AI relies on using intricate formulas to integrate data from other sources, including social media, web activity, and transaction history. This enables marketing departments to develop detailed customer databases based on business intelligence. 

AI tools can help you in: 

• Segmenting your audience. 
• Analyzing the behavioral patterns of your audience. 
• Using predictive analytics to target your audience more effectively. 

2. Create personalized marketing strategies. 

Direct marketing is a strategy that uses targeting to present specific offers and messages to customers. Personalization can be achieved largely since AI can dissect customer data and infer which content or deal will be most useful to a specific individual. 

Using AI in creating personalized strategies can help you in: 

• Recommending the relevant content to your audience in real-time. 
• Using dynamic content to adjust itself in real-time based on user inputs. 
• Craft personalized emails and automate sending and replying to them based on audience segmentation. 

3. Craft campaign messages using insights from AI tools. 

AI can be vital when it comes to curating messages that can be used to launch a particular campaign. Applying the research results of customers’ behavior and preferences, AI allows organizations to present topics that matter to the target audience. 

Here is how you can craft compelling messages.

• By using sentiment analysis to make your customers feel valued. 
• By using trends to predict what your audience might prefer. 
• By using A/B testing to figure out which messages perform best in front of the real audience.  

Key Takeaways 

AI is gradually gaining its roots in contemporary marketing by enriching how organizations comprehend and interact with their clients. Experts at Mavlers believe that one of its advantages is the chance to generate extremely individualized and effective campaigns that allow reaching the target audience and generate higher revenues. Mavlers is a new-age digital marketing agency with expertise in creating highly targeted campaigns for new and old businesses.