Audience Segmentation for Native Ads in Ecommerce

STOP Using Broad Targeting on Meta Ads (If you want a higher ROAS) After auditing $100M+ in ad spend across premium 8-9 figure e-commerce brands, here's the framework that's actually driving profitable scale: The Cascade Targeting System Most brands get targeting backwards. They deploy mass market messaging that no one listens to. Instead, they need to speak to many niche groups—personally. Optimize for resonance before reach. Here's the 3-layer framework that's generating a 3X-10X MER: → Level 1: Market Segments (Highest Impact) → Level 2: Personas (Secondary Impact) → Level 3: Angles (Tactical Impact) The AG1 Example: Instead of "Get healthier today" mass-market messaging, here's how they stack segments: Level 1 | Market Segments: → Travelers → Athletes → Busy Parents Let's use the busy parents segment as an example. This may breakdown into multiple personas as follows. Level 2 | Busy Parents Personas: → The Nutrition Research-Oriented Busy Parent → The Convenience-Focused Busy Parent → The Wellness-Minded Busy Parent Now we'll create different angles for each persona, let's just use the first one here. Level 3 | Nutrition Research-Oriented Busy Parent Angles: → "Nutrition you can trust for your family" → "Simple ingredients, 3rd-party tested, pediatrician-approved" → "Efficacious absorption for all gut biomes" To scale this, we can just add more angles, personas or market segments. The Data That Changes Everything: Mass appeal creative: Hits 15% of audience at 25% message resonance Hyper-targeted creative: Hits 100% of audience at 85% message resonance The Scaling Hierarchy (By Account Impact) 1. New Market Segments → Unlock entirely new customer pools (highest ROI) 2. New Personas → Deeper penetration within existing segments 3. New Angles → Tactical optimization within proven personas (lowest ROI) Here's what most brands miss: The biggest impact on account performance doesn't come from better creative execution. It comes from strategic market expansion. Most premium e-commerce brands are sitting on 5-10 untapped market segments. They're optimizing the wrong variable. The breakthrough happens when you stop asking "How do we appeal to more people?" and start asking "Which specific group haven't we spoken to yet?" Each new market segment you unlock is a step-function increase in addressable audience. Each new persona is incremental growth within that segment. Each new angle is tactical optimization towards converting that persona. Stop trying to be everything to everyone. Start being everything to someone very specific. Then stack another segment. And another. That's how you build a $100M brand from targeted creative strategy.

In e-commerce and digital apps, user representation drives personalization, segmentation, and marketing. Current approaches rely on implicit embeddings (from clicks/purchases) that are powerful but opaque, or explicit features (like category preferences) that are interpretable but shallow. The paper 𝗬𝗼𝘂 𝗔𝗿𝗲 𝗪𝗵𝗮𝘁 𝗬𝗼𝘂 𝗕𝗼𝘂𝗴𝗵𝘁: 𝗚𝗲𝗻𝗲𝗿𝗮𝘁𝗶𝗻𝗴 𝗖𝘂𝘀𝘁𝗼𝗺𝗲𝗿 𝗣𝗲𝗿𝘀𝗼𝗻𝗮𝘀 𝗳𝗼𝗿 𝗘-𝗰𝗼𝗺𝗺𝗲𝗿𝗰𝗲 𝗔𝗽𝗽𝗹𝗶𝗰𝗮𝘁𝗶𝗼𝗻𝘀 (𝗦𝗜𝗚𝗜𝗥’𝟮𝟱) introduces GPLR, a framework using LLMs to turn transaction histories into rich, human-readable personas (e.g., “Busy Parent,” “Bargain Hunter”)—making user profiles both interpretable and actionable. GPLR generates interpretable persona labels and descriptions (e.g. “DIY Enthusiast – purchases tools, building supplies, home improvement gear.”) , uses LLMs to annotate a small set of users with these personas, and then scales to millions of users cost-effectively by propagating labels through a random walk method (RevAff). 𝗛𝘆𝗯𝗿𝗶𝗱 𝗮𝗽𝗽𝗿𝗼𝗮𝗰𝗵: Personas and embeddings can be used together in a hybrid approach to make personalization actionable, explainable and scalable. Embeddings capture 𝗳𝗶𝗻𝗲-𝗴𝗿𝗮𝗶𝗻𝗲𝗱, 𝗲𝗽𝗵𝗲𝗺𝗲𝗿𝗮𝗹 𝘀𝗶𝗴𝗻𝗮𝗹𝘀 that change quickly with context and are great for micro-personalization. Personas are more stable and capture 𝗿𝗲𝗰𝘂𝗿𝗿𝗶𝗻𝗴 𝗹𝗼𝗻𝗴-𝘁𝗲𝗿𝗺 𝗵𝗮𝗯𝗶𝘁𝘀 or need. They are useful for segmentation and macro-personalization. 1. 𝗘-𝗰𝗼𝗺𝗺𝗲𝗿𝗰𝗲 𝗰𝘂𝘀𝘁𝗼𝗺𝗲𝗿 𝗿𝗲𝘁𝗲𝗻𝘁𝗶𝗼𝗻 𝗲𝘅𝗮𝗺𝗽𝗹𝗲: Customers churn if recommendations feel irrelevant or impersonal. Member: Dave Personas: Outdoor Adventurer (0.9), DIY Enthusiast (0.7) Embedding signals: Recently browsed winter jackets and power drills. Hybrid retention action: Embedding detects browsing of power drills and personas add context that Dave is DIY-focused. Personalized seasonal campaign: “Adventure-ready camping gear for fall”. Send cross-sell offer: “Outdoor toolkit bundle for DIY explorers.” Recommender System: Suggests camping-ready multi-tools + DIY accessory kits. Result: Cross-sell aligns with both immediate interest (drill) and stable persona (DIY). Dave feels understood and returns for repeat purchases. 2. 𝗛𝗲𝗮𝗹𝘁𝗵𝗰𝗮𝗿𝗲 𝗺𝗲𝗺𝗯𝗲𝗿 𝗮𝗰𝗾𝘂𝗶𝘀𝗶𝘁𝗶𝗼𝗻 𝗲𝘅𝗮𝗺𝗽𝗹𝗲: Members disengage when care feels generic. Member: Carol Personas: Family Caregiver (0.9), Preventive Health Seeker (0.7) Embedding signals: Recently searched “flu shot near me” and read “stress management for parents.” Hybrid retention action: Embedding flags interest in stress relief and preventive care and personas emphasize stable Family Caregiver role. Recommender System: Personalized suggestions for “Flu vaccine appointment for your family” + “Mindfulness sessions for caregivers.”    Result: Carol gets timely, relevant and personalized suggestions via proactive outreach which makes her feel supported. Link: https://lnkd.in/eu6k_bGd

Most marketers think they know their audience—but do they really? It’s easy to focus on surface-level details like location, age, or interests. But what about identifying which audience segments are actually driving the most value for your business? If you didn’t already know, let me tell you: Identifying your high-value audience segments can have a significant impact.   It can lead to:   ● Smarter ad spend ● Higher conversions ● A loyal customer base   Here are a few ways you can uncover these segments:   ➥ Analyze Purchase Patterns Look into your data closely!   Every customer has a buying pattern.   See past purchases to identify trends and find out which customer types buy more often or spend more per transaction.   These patterns reveal the segments that deserve your attention.   ➥ Behavior-Based Targeting Analyze how customers are interacting with your content.   Track their behaviors like:   ● How many times they visit your website ● How they engage with ads ● How much time they spend on pages   High engagement often points to high-intent audiences that are worth targeting.   ➥ Customer Lifetime Value (CLV) Segmentation Not all customers have the same lifetime value!   Break down your audience to find the segments that bring the most long-term value.   Invest in nurturing these relationships to maximize your ROI.   ➥ Survey Your Customers Sometimes, direct feedback can reveal insights that data alone can’t.   Ask your customers about their needs, pain points, and reasons for purchasing.   Their responses might lead you to niche segments that may not be obvious at first glance.   Knowing your audience isn’t just a box to check.   If you want to set yourself apart in a crowded market, you need to understand the people behind the numbers.   P.S. How well do you know your audience?        

Your ads aren’t broken—your audience is. Most businesses don’t have a lead problem—they have a wrong audience problem. Who do you serve, and how do they find you? If your answer is "everyone," you're leaving money on the table. Here’s a real example: I worked with a regional retail chain that was spending big on social ads—yet conversions were low. Why? They were targeting broad demographics instead of their highest-intent buyers. ->We refined their audience segmentation based on actual purchasing signals. ->We adjusted their ad creative to speak directly to their most engaged customers. ->Result? Ad performance doubled, cost per acquisition dropped 40%, and sales spiked. The Fix? 5 Takeaways for Smarter Segmentation: 1) High-Intent Buyers > Large Audiences – Bigger isn’t better. Engagement signals > Reach. 2) Data-Backed Targeting Wins Every Time – Use AI, analytics & purchase behaviors—not guesswork. 3) Messaging Must Match Buyer Psychology – Speak directly to their pain points & desires. 4) Segments Change—So Should Your Strategy – What worked last year may not work today. 5) Smarter Segmentation = Lower Ad Costs, Higher ROI – The more precise your audience, the more profitable your campaigns. Ready to target buyers, not just traffic? Grab the Ready Buyer Targeting Framework now: https://lnkd.in/egPAuD_P ♻️ Share this to help others—pay it forward. Follow Dan Prudhomme for insights that work.