Why Your Business Needs Customer Segmentation to Grow

Today’s best marketers know that reaching customers isn’t simply a one-size-fits-all solution. It’s personal. We’ve found that there is no better way to get more personal with your e-commerce business than customer segmentation.

According to SearchSalesforce, customer segmentation is “the practice of dividing a customer base into groups of individuals that are similar in specific ways relevant to marketing.”

In other words, it’s dividing your customers (and potential customers) into groups so you can market your products more effectively. The most common categories that customers are divided into are demographics, geography, psychographic characteristics, and behavioral habits.

Once you divide your customers into groups, you can use the data to serve your audiences and grow your online business. Let’s take a closer look at why every online business owner today needs to use customer segmentation:

You can deliver more personalized messaging

Segmenting allows you to collect a ton of useful data on your customers. You’re able to learn helpful details about their buying habits and preferences. From there, you can deliver messages that meet your customers exactly where they are.

With this type of personalized marketing, you serve your customers with what they’re likely to purchase. Everybody wins. You make more sales and your customers learn about (and purchase) products that align with their needs and wants.

You can purposefully expand to other markets

Segmenting your customers also allows you to make more informed decisions when growing into specific markets. Do you have a certain demographic of people that is most likely to spend money on a product? You can start a campaign that targets this group.

On the other hand, are you spending a hefty amount of marketing dollars on a group of people that simply isn’t likely to spend much money on your products? It’s probably time to reassess your strategy. When you know your customers’ behaviors, you can adjust your marketing strategy as you grow into new markets.

You can improve customer retention

Retaining customers means facilitating an ongoing relationship with them. With more data, you can stay connected to your customers in a more helpful way. For example, if somebody just bought hiking boots on your site, you can follow-up with an email about hiking socks you offer or great places to hike in their area.

You can even use valuable customer data to create better product pages. As you build up a track record with your customers, they’ll be more likely to turn to you for their needs. Be sure to ask customers for feedback and take note of specific trends. This give and take is the key that will grow your business.

Do you want to learn more about how segmentation can make your business more profitable? Schedule a consultation with us!