If you’ve ever searched “small business marketing tips,” you’ve probably found out that email marketing is one of the best options out there. Studies show that the average return for every $1 spent on email marketing is $42. There are few (if any) other investments you can make in your business that offer a return that good.

But here’s the thing about email marketing. You won’t get those outstanding results if you just send generic messages to your entire email list or, worse, ghost your list for months only to pop up and ask for money. You need to be more strategic.

Think about your own inbox for a minute. Which marketing emails do you tend to open? Are you excited to read something with a boring subject line that looks like it was just sent to anyone who has ever subscribed to a company’s list? Probably not — most of us ignore those messages.

But have you ever gotten an email that felt like it was just for you? Maybe it showed an item that you left in your cart and included a discount code. Or maybe you got a message offering tips on how to use a product that you purchased recently. 

Those are examples of messages that resonate with readers. And those are the types of emails that can convert for you, too. So let’s talk about how to create those messages and send them to the right people.

Disclaimer: The below article might contain affiliate links. That means if you click on an identified link* and subscribe to the product or service, I might receive a commission for the referral. Quality and integrity are cornerstones for me, though, so you can rest assured that I’d never recommend anything I don’t use and love myself.

Email Segmenting, Part 1: Email Lists

The first step in email marketing is building a list — you need to have people to send your messages to, after all. An email list is basically just a group of contacts who have agreed to receive emails from you. Make sure your website has a way to capture people’s email addresses. 

It can be something as simple as a form with a “sign up for our newsletter” message. Or you can use a lead magnet to incentivize people to give you their contact info. You can also gather email addresses when people purchase your offers, schedule a discovery call, or sign up for an online event, like a webinar.

Most businesses only need one main email list. (We’ll talk about separating it into smaller lists in a minute.) But sometimes it might make sense to have two different email lists. 

For example, if you have a sister brand or an offshoot of your main business, you might want to have a separate list for each brand. I have a master list of contacts for my brand and a second list of people for the Pixie Dust & Profits podcast.

Once you’ve started building your list, it’s time to take the next step: tagging contacts.

Email Segmenting, Part 2: Email Tags

What’s an email tag? It’s essentially a data point that you can assign to a contact that gives you a little more information about them. For example, when someone buys one of your offers, you might want to tag them as a Purchaser. If someone puts a product in their cart and then leaves before checking out, you could add an Abandoned Cart tag to their contact.

The number of tags you could implement in your email list is infinite. But you don’t necessarily need a tag for every single possible data point. It’s actually better to limit the number of tags — there’s a delicate balance between helpful data and information overload. Think about the information that’s most valuable to you, and track those things.

You could create tags based on actions:

• Scheduled Consult Call
• Made Purchase
• Abandoned Cart
• Viewed Sales Page

Another option is to tag based on demographic info (if you have that for the people on your list). Not all businesses ask for this information, so decide whether it’s important to you. 

• Generation: Millennial
• Income: Greater Than $50k
• Location: United States
• Location: International
• Parent (Teenager)
• Parent (Toddler)

What about tagging based on engagement with your brand?

• Cold
• Inactive for 30 Days
• Loyal

Or you could think about it the opposite way and tag based on disinterest. For example, if you know someone isn’t interested in your high-touch offers, they might unsubscribe entirely if they keep receiving promo emails for those offers:

• Not Interested: Weekly Newsletter
• Not Interested: Product Launch Promotion (Month Year)

There are many other tags you can consider using. Maybe you want to tag contacts based on their interest in certain offers, the opt-in offer they downloaded, the type of products they usually purchase, or the time of year they usually purchase. You could also tag contacts based on where they came from (e.g., Facebook ad, in-person event, affiliate campaign, etc.)

Now that you have all your contacts tagged, you can use those tags to divide your email list into groups of similar contacts.

Email Segmenting, Part 3: Email Segments

Email segments are just subsets of your full email list. The idea behind segmenting your list is that you can separate your contacts into groups that have different needs and requirements. For example, you can create a segment for all the contacts that purchased your entry-level offer. Then, you can send an upsell sequence for a relevant offer to that group specifically.  Those upsell emails don’t necessarily apply to everyone on your list, but they’ll probably resonate with the people who just bought your offer.

Take a look at the tags you decided to use and think about what they’re telling you about your list. 

Here are some examples:

• Purchasers
• Non-Purchasers
• New Subscribers
• Current Students
• Past Students
• Sales Relationship (e.g., Never Purchased, First-Time Purchaser, Repeat Purchaser)
• Business Stage (e.g., Not Started, New Business Owner, Seasoned Business) 
• Geographic Location (e.g., U.S., Canada, International)

Again, you don’t have to use all (or any) of these. See what your tags are telling you about your list, and then use that information to create email segments that make the most sense for your audience and your email marketing strategy. Once you have your segments, you can start creating and sending targeted emails to each group.

Does your email tool support tags and segmenting?

Now that you know how to use email lists, tags, and segments, it’s time to put them into action. But first, you need an email platform that supports these actions. Most of the big platforms, like ConvertKit, Mailchimp, and Flodesk, support some level of segmentation. But in my experience,  ActiveCampaign* has the most powerful capabilities and automation potential of the systems at a fairly accessible price point for small businesses. 

If you’re just getting started with email marketing, I would recommend starting with ConvertKit, which has a free option for new businesses. ActiveCampaign can admittedly be a higher learning curve when you’re just starting. 

The beautiful thing about your email list is that it is yours and you can move to ActiveCampaign once you’re ready for more advanced email strategies. 

With all the built-in segmenting options, tagging, and automations, ActiveCampaign has everything you need to make the best use of email lists, tags, and segments. (If you want an inside look at how I use ActiveCampaign with my clients, read this blog post.)

Ready to upgrade your email marketing, and start seeing better open rates and conversions?