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Segmented Messaging Drives Increased Engagement and Conversions

Quick Take:

Merkle has been working with a large national nonprofit and advocacy group to grow their membership base. The client’s mission is to enhance the quality of life for all as they age – not just their members. The organization conducts research to uncover and understand issues affecting the livelihood of the aging population. They address these issues by offering everyday discounts for products and services, publishing thought leadership, and advocating for programs like Social Security, healthcare, and affordable housing.

Engagement:

Merkle Analytics and Customer Strategy work with the client’s Audience Management team whose goal is to drive an audience-first approach within each business unit, ultimately helping them acquire and retain members. This particular test was a collaboration between Merkle, and the client’s Audience Management and Member Acquisition teams. Member Acquisition runs an ongoing paid media campaign to attract new members that was used for testing in October through November.  

Challenge:

The client has an aggressive goal to grow membership 5% by 2028. To do this, they must retain existing members and tap into underpenetrated markets to acquire new members. The 50-59 year-old audience represents a major opportunity for them.

Penetration with 50-59s is low because many put off membership until their 60s when they perceive the nonprofit and advocacy group’s services as more relevant. In truth, the group has many programs and discounts that are applicable to people of any age, and there is no age restriction for membership. To relate to and attract the 50-59 age group, the client realized they would need to move from a one-size-fits-all message to audience-focused. Segmenting by age would help, but why stop at age? Age, race, family size, income, etc., all play a part in determining what makes the client’s services valuable from one person to the next. They needed to identify different audience segments and learn what those people look for in an organization like the client’s. Once these drivers were uncovered, testing would be required to confirm segmented messaging drives engagement and membership.

Approach:

The first step of attracting more 50-59 year-old members was to learn what their behaviors, interests, and lifestyles looked like. To get a full picture of the audience, it was important to understand why existing members joined as well as what prospects are looking for. To reveal what the larger prospect universe looked like, we took a sample of 200,000 US 50-59-year-olds excluding current members. The analytics team modelled four distinct segments (Active & Ambitious, Easy Engagers, Cozy & Prudent, and Hard-working Homebodies) based on their maximum differences of 540+ DataSource variables. This segmentation was then applied to the current member database.

By using multi-dimensial segmentation, the client now had a strong view of their 50-59 customer. Layering the segmentation onto the membership database allowed Merkle to see trends within each segment such as which channels they joined on and specific programs and offers they preferred to engage with. Using the appended DataSource variables we created Audience Insight Maps (AIMs), bringing the segments to life and uncovering prominent characteristics that set each segment apart from each other. These additional insights formed the basis for messaging. Since Merkle developed the segmentation model using M1, Merkle’s proprietary segmenation, activation, and measurement platform, the segments could be targeted in digital media– a new capability for the client.

To prove using segmentation is effective in prospecting, we devised a messaging test using paid programmatic ads on Facebook. We set out to answer two questions:

  1. Do the segments respond to segmented messaging (regardless of the intended segment) at a higher rate than they respond to control messaging developed for a 50+ audience?
  2. Do the segments respond to messaging designed to drive their behavior e.g., do Active & Ambitious respond more/most to messages designed for Active & Ambitious?


To prove our hypothesis that segmented messaging drives engagement and membership in digital ads, creative was developed for each segment based on their distinguishing lifestyle characteristics that aligned to specific client programs and discount offerings. Prospects in each segment would be served one of five ad options, one for each segment including their own, plus a control ad with generic 50+ audience messaging. This allowed Merkle to measure not only if the segmented messaging outperformed the control, but also whether the intended messaging for each segment drove higher engagement via CTR and conversion rates (measured by prospects becoming members).

Results

Facebook Stats:

23%

increase in click-through-rate CTR

48%

increase in conversions (those who became members)

73%

reduction in cost-per-acquisition (CPA)

Keys to success

  • Modelled audiences based on the US population and then applied them to the client’s membership database
  • Uncovered unique characteristics of each audience by creating audience insight maps
  • Used first-party data to determine optimal channels each 50-59 segment converted on as well as specific programs and offers 50-59s frequently use
  • Created messaging for each of the four segments that aligned with their lifestyles
  • Developed a segmentation model using M1, making each segment identifiable for targeting in digital media

Discover how we did it. Contact us today.

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