This is not so simple in today’s world, but you too can use customer segmentation to better understand your customers and address their needs and concerns more individually. Read this article to find out how you can maximize your return on investment using segmentation.
Customer segmentation describes the division of your customer base into subgroups. It allows you to divide your customer base into customer groups according to individual characteristics and adapt marketing measures to different customer profiles in the right traction channels. This creates individuality while at the same time conserving resources.
By splitting your customer base, you better target the needs of your customers, tailor the value proposition and your marketing efforts to different customer groups.
You also use customer segmentation to identify which customers are particularly profitable and can send individual messages to these customers.
Both terms are often used synonymously, but market segmentation and customer segmentation are actually two different things.
Market segmentation is about dividing a heterogeneous overall market into homogeneous submarkets. The entire market, which is made up of potential and existing customers, serves as the basis here. The aim of market segmentation is, among other things, to evaluate which market segments are lucrative and which new or existing products are suitable for the respective segments.
Customer segmentation, on the other hand, relates only to current customers. Here, the existing customer base is segmented into subgroups. The aim of customer segmentation is to identify particularly profitable customers (see also Customer Lifetime Value). Criteria for classification are the same as those used for market segmentation. However, since significantly more information is available here, customer segmentation provides more detailed results.
Successful customer segmentation consists of several steps. This is important and helps you to apply it successfully. The following procedure will assist you in achieving a successful segmentation strategy:
A decision is to be made between two approaches for carrying out segmentation. While the one-dimensional customer segmentation only takes decisions according to one characteristic, the multidimensional one considers several factors in combination.
The resulting parts here are not really segments, strictly speaking, because the customers within the groups are not actually homogeneous. While they all share one common feature, they can differ significantly in many other respects.
One-dimensional customer segmentation is particularly useful in providing a quick and straightforward analysis of your customer structure. It also presents the economic significance of the customer segments in a particularly transparent way.
However, its disadvantage is that only one aspect is considered. In this way, no homogeneous customer segments are formed. In addition, qualitative factors are neglected in the one-dimensional approach.
The following methods are well suited for a one-dimensional analysis:
Multidimensional customer analysis combines several of the above-mentioned characteristics, which are used to form the segments.
The advantage here is that segments are significantly more homogeneous, resulting in “real” customer segments with more informative value.
The following methods are suitable for multidimensional analysis:
What characteristics you can use to cluster customers varies depending on whether your company is B2B or B2C.
In B2B, you segment customers according to the following data:
If your company operates in B2C, you consult the following criteria for segmentation:
Customer segmentation helps you better understand your existing customer base. This enables you to tailor your corporate marketing campaign goals more effectively to the needs of your customers.
In addition, in areas such as Customer Success or Customer Support, you can address your customers and their expectations (the so-called Customer Expectations) more accurately. This improves customer satisfaction, and even more importantly, it creates customer enthusiasm and saves you resources.
Last but not least, customer segmentation will also help you identify particularly profitable customer groups.
As a customer insights expert and certified Scrum product owner, I experience the importance of customer-centric product and marketing development on a daily basis.
Working with agile optimization processes and a corporate culture open to experimentation, you will get your growth on track.
100% free of charge | 25 min. individual consultation
This service is not only available because of the current corona situation.
But right now it is more important than ever, together and for each other.