Set up nested distribution groups in Exchange/Outlook? (Master, Sub1, Sub2, etc.)

In my Vertical Response account, I maintain a "Master List" - I can then "tag" users to be part of sub lists.  That way, I can mail everyone, or just "Sub1" list, "Sub2" list, etc.

I imagine Exchange has something to replicate this setup - can it be done within public folders?  distribution lists?  sharepoint?

My first thought was to make a "Master" distribution list and then use categories to sort through that list - but I don't know that there's anyway to quickly mail a subsection of categories.

Or if I make a public folder of contacts, and then subfolders ("categories") - can I email the "Main" folder to go to everyone - and then pick a subfolder to only send to that grouping?

Any other thoughts?  

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Yep, use nested DL/ DG

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blueteamAuthor Commented:
So I can set up DL "Sub1", "Sub1", etc. and then make "Main" which will mail "Sub1", "Sub2", etc.?

Can the same thing be done with categories somehow?
blueteamAuthor Commented:
The reason I ask about the categories is because what if someone is a member of more than one sub group - I don't think that could be handled in nested groups without duplicating data.
If you use mailbox store instead of Public folder, Then even if user is member of multiple subs he/she will receive an email. If you go as per Public Folder setup then user need to check manually each folder which concerns him
Exchange is intelligent enough to only send you one message even if you are a member of several layers in nested DL
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