Things Nobody Tells You about Customer Segmentation

An appropriate customer segmentation grants you with peripheral opportunity to engage all your customers consistently.

Also customer segmentation allows you to build a better relationship and learn more about your customers.

Moreover, around 75% of the satisfied customers tend to stay loyal to those brands, who frequently cater to their needs.

customer segmentation

Hence, let’s dive in and learn more about how Customer Segmentation can help you organize your business!

But, before that let’s shed light on what is Customer Segmentation?

Customer Segmentation is nothing but segregating your customers into several groups on the basis of their character traits and activities. Customer segments aid you to market those groups effectively for various business operations like creating marketing campaigns, defining market segments and handcraft personalized messages to your prospects and many more.

You will be able to segment your customers according to multiple ranges of factors such as location, industry, gender, age numbers or customer’s purchase history, etc.

And various types of Consumer Segmentations are

Geographic segmentation

Geographical segmentation lets you divide your market on the basis of geographies like city, country, state, climate or season. Through this, you will be easily able to identify the needs or wants of the consumers residing in various areas and practicing distinct cultures.

For instance, you are a luxury car brand, and you want to target your customers who reside in warm weather as your vehicles are not equipped for snow lad areas. Therefore, you focus your marketing efforts around the city centres and urban areas where people are likely to work.

Demographic Segmentation

This kind of customer segmentation is done according to gender, income, age, religion or education, etc. Demographic segments utilize population data to segment your market.

Suppose you are a parenting product company and you want to target the new moms. Therefore you should look for segments which are filled with women who have recently given birth. Thus you can seamlessly target them and advertise your products.

Psychographic segmentation

When you group your customers into their purchase behaviours, online activities, interests or preferences, those are known as psychographic segmentation.

Let’s say you are an e-commerce brand who wants to promote new collections of western wear. Therefore, you can target those who have already bought western collections from you or those who have a keen interest in western wears.

Behavioural segmentation

It is a form of customer segmentation which divides the people into multiple groups who have common behavioural patterns. These user segments can be made on those who have similar behaviours, share the same lifecycle stage or give the same reactions to your messages.

Say you are an automobile brand and want to promote your brand. Therefore you could look for a segment who holds a keen enthusiasm for cars or that market segment who already have cars.

Customer journey segmentation

When you consider segmenting your audiences on the basis of their intent and consent are known as Customer Journey segmentation. This segment is also known as brand awareness stage.

This is a unique segment where you must look out for your customer’s buying journey. And identify the trends like what kind of ads appeals to them or when they are likely to convert, etc. Hence, you could seamlessly target them with relevant offers.

As we walk through the various types of Customer Segmentation in the market, it might occur to you why a brand needs customer segmentation?

Understanding your customers in a proper way is always beneficial to any brand. Consumer segmentation is not about dividing your customers into good or bad but depending on certain criteria. Segments are made to help you curate your message in a better way.

Now, with consumer segmentation, you will be able to divide your customers into specific groups depending on their interest and needs. This will also help you in effectively targeting them.

So, let’s check out the necessary reasons why customer segmentation is crucial…

why customer segmentation is crucial

Bring back your old customers

As one of the famous sayings goes “old is gold”, a marketer should never undermine their old customers. Though most often, consumers forget about the brand they make the first purchase with. So, it is your duty to drive them back to your business.

Hence, by segmenting your customers, you will be easily able to identify the one-time customers and curate a strategy to attract them back. For instance, you could quickly send them an exclusive discount or a free benefit on buying some particular stuff.

Offer highly Personalized Experience

As mentioned earlier, offering a highly personalized experience to users always gets you ahead of your competitors. And you can easily do it with customer segmentation by identifying the trends of each group.

For example, you want to identify a segment as “Professionals”, and you want to target them with “how to de-stress”. So, you should send them a mail highlighting how they could lighten their stress while at work. These will let you connect to them on a personal level, and they might feel it relevant and click.

Enhances your Brand Awareness

Consumer segmentation also lets you make aware of your brand among your prospects. Thus, identifying your brand will help your prospects to engage immediately with your products or services.

Apart from that, this also enhances your goodwill in the market and makes your brand more established in the market.

Enables Onboarding Customers

Consumer segmentation often leads to creating a better relationship with your customers. A personalized experience will also make your customer come back as they feel obligated towards your brand.

An advanced onboarding program delivers particular value to your future prospects and communicates with them at the core about why they should care about your brand or your products/services.

Also through customer segmentation, you obtain valuable information on your consumers. Therefore you get to target them seamlessly with customized products. And your customers have a seamless experience all through.

Empowers to stay ahead of your competitors

Understanding your customers in the right way empowers you to deliver a seamless customer experience and excellent retention rates. But, brands who do not segment their audiences often find themselves in a wary position. They fail to understand their competition market, their audiences and targeting strategy, which keeps them lagging in the race.

A study reveals that 65% to 75% of the new products do not meet their revenue targets. And the sole reason behind it is, the brands are unaware of their customers’ desires.

Do you see how crucial Customer Segmentation is for marketers?

So, let’s go through the steps of segmentation.

Here are 5 simple steps to complete your customer segmentation like a pro…

steps in customer segmentation

1. Start with Audience Analysis

When you have an existing audience base, begin with a market segmentation process through audience analysis. Audience analysis lets you learn about your customers and allows you to identify the trends of your present customer base.

Identifying your audiences and getting an idea about their interest and belief is really easy now. You can do this with an effective audience management suite where you can efficiently manage, enrich and segment your data. Therefore, those highly advanced customer data points can be used further for targeting or other marketing operations.

Engage with your customers & sales team

To do this, you need to communicate with your customers and get an idea all about their interests, desires, age, income, locations, etc. Also, it would be best if you would interact with your sales team as they spend a lot of their time with the customers. So, you could get a few more insights about your customers.

Look at your business data

When you are running a business, you are likely to have lots of data on your customers. Utilize customer relationship management tools to find out the trends related to the behavioural segmentation. CRM also lets you enhance your communication with your customers and improves your consumer experience.

So, make use of that data which reflects how customers make purchases, which type of products they choose or how much they usually spend.

Take the help of Audience Insight tool

Audience Insight tools allow you to have detailed information pertaining to your consumers. The audience insight which you gain from your customers is their needs, interests and their preferences.

Also, it lets you collect customer data points which enables you to communicate with your customers in a very personalized way. As these insights reveal the customers’ purchasing patterns, demographics, online behaviour, etc.

And those insights from audience insight tools will prevent you from creating irrelevant content that will not add value to your audiences. You could also save your ad budget at the same time.

2. Now create an ideal customer profile

After you have had analyzed your audiences, you will get a fair idea about the characteristics of your audiences. So, now you could easily create customer profiles which describe the relevant customer type you would want to target.

Customer profiles allow you to target your ideal customers seamlessly and makes your marketing campaigns successful.

3. Identify your market segment opportunities

As you have made your customer profiles, and also defined your ideal customers, begin looking for market segment opportunities.

A market segment opportunity is a phenomenon which drives marketing strategies. It also makes you question your brand’s proposition, objectives, USP and more. Also, refer to buying persona and audience analysis to discover market opportunities.

4. Make a research on your future prospects

Make sure you verify the consumer segment before launching your marketing campaign. Research and find out what kind of competition exists and whether audiences are interested in your offer.

When you have audience insights you already know a great deal about your customers. Hence, it would be easier at your part to locate the future prospects through an audience management suite.

5. Test your Idea

Do a few testing, before you actually launch your campaign. As you find new markets and you want to explore those, running a few tests is always useful. When you run the test campaigns, you might realize several minor mistakes which you could rectify while running the real campaigns. And you never know these small tweaks result in significant results.

Customer Segmentation is meaningful, and it opens multiple doors to your marketing.

So, how about a platform where you can seamlessly segment your audiences and target effortlessly?

Yeah, integrate your platform with Audienceplay and manage your audiences effectively.

An innovative and advanced audience management suite by DigitalKites brings you all the audience solutions at your doorstep. Audienceplay lets you manage your audiences and help you segment them accordingly. Also, you can find more relevant insights from a large publisher network which would enrich your consumer segments further.

Once you onboard your customer data or integrate your platform with Audienceplay, you will be able to segment them according to your business goals quickly. You can also create advanced custom segments with extra insights on your audiences.

Audienceplay also takes good care of privacy compliances while integration. Hence, no need to worry about your data privacy or security.

Don’t believe me, go check out yourself.. Audienceplay

Closure on Customer Segmentation

A marketer could easily engage with their customers through relevant customer segmentation. You segment a customer on the basis of their particular character traits. Therefore it lets you group them according to it and connect with them respectively.

The true goal of customer segmentation is to know your consumer in a better way and connect with them on an empathetic level. This only helps you improve your brand image and goodwill but also lets you earn plenty of revenues.

So, maximize the value of your consumers through customer segmentation and soar your business to new heights.

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About the Author: Aditi L

I'm a technical writer and excel in writing on the latest technologies of the digital advertising industry. I possess significant knowledge and proven experience in adtech & martech trends and even indulge in-depth research on modern digital technologies to deliver engaging content. Writing inspiring blogs and light-minded poems have always been my passion. I also dream of writing a book one day. Apart from writing, enjoying art & music has been my forte.

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