In order to provide users with exactly what they are looking for at the right time, you need to know them, know who they are. The key to achieving this is customer segmentation . If you haven’t heard of it yet or if you have just a vague idea about it, don’t worry! In this note we will tell you everything.
✋ But before giving you the details about what segmentation is and how to carry it out in your business, some statistics to keep in mind:
- 91% of consumers say they would buy from brands that provide offers and recommendations relevant to them.
- 80% of people prefer to buy from a company that offers personalized experiences.
- Marketers see an average 56% increase in sales when they offer personalized experiences.
What conclusion can we draw from all this? So that your business stands out and you can give users exactly what they hope to get, you need to customize the experience. What is the way to achieve it? Customer segmentation.
Now, the time has come to find out what this strategy is about.
What is customer segmentation?
Customer segmentation is a process by which a company is in charge of grouping the users of its database according to various parameters. In general, these contacts are grouped according to their characteristics, interests and consumption.
In this way, we can say that There are various types of customer segmentation. There is no single way to classify a user base. This is largely due to the fact that within the same audience you can have different needs or objectives, depending on the characteristics of each individual and the moment or stage of the journey in which they are.
☝️ Not all people have the same needs at the same time and not all are impacted in the same way by the same messages.
What do we mean by this? Even if you sell a single product or service, the way you approach each user will not be the same in each case. Once again, the Customer Journey has enormous relevance.
Customer segmentation examples : if a user has just left their details to sign up for the newsletter, we will most likely approach them with a welcome message and some valuable content to start introducing it in the products that the company sells. Above all, we will seek that you understand the benefits or solutions that you can find. But if a user has already bought and we have stopped receiving news from him for a long time, we will surely use recovery emails to encourage you to return. The way to approach it will be totally different in each case.
Of course, this is just one of the criteria that you can take into account when segmenting your audience. Next, we are going to know what other ways you can do it.
Types of customer segmentation
So far we have made it clear that customer segmentation consists of dividing into groups the different users that are linked to your business . The objective of this strategy is to offer increasingly personalized messages and experiences and thus achieve more conversions.
We also mentioned before that there are different types of customer segmentation, do you want to know what they are? Here we go!
Demographic segmentation
This is possibly one of the types of customer segmentation most used by companies. Usually the first criterion to use to group users. When we talk about demographics we mean:
- Age.
- Gender.
- Education.
- Civil status.
- Family size.
- Occupation.
- Income level.
It is, basically, the breakdown of the users that are part of the company’s database, based on superficial traits such as age or gender .
This helps us answer who these people are in our contact base. Without a doubt, it is the easiest data to obtain, because it is a less invasive segmentation than others. The user only needs to complete their data through a form or a survey and with that we would already have the information.
Segmentation of customers by demographic data saves time and places us more clearly in front of our audience , understanding who we are targeting.
However, we must say that, as we mentioned before, this criterion gives us superficial information, so it does not allow us to know the users in depth. To do this, we will need to combine it with another type of segmentation that we will see in the following points.
Geographical segmentation
If we talk about customer segmentation examples, this is another of the clearest. Is about divide users based on geographic location criteria. In other words, it is a type of segmentation designed to answer where the people in our contact base are. In this way, the criteria to identify when we group consumers according to their physical location are:
- Country.
- Region.
- Town.
- Postal Code.
This type of customer segmentation can have a significant influence on interactions in physical stores. Therefore, it is one of the criteria most used by businesses that are committed to the local marketing .
In addition, consumers grouped in similar geographical areas may share similar preferences, so applying this segmentation criterion within your strategy can be very useful.
Behavioral segmentation
So far we have presented you with two types of customer segmentation that help answer the who and where of your database. Now we are going to introduce you to another kind of segmentation that can help you answer How do users behave?
This is behavioral segmentation. It is based on the behavior patterns of people while interacting with a brand. Here we delve into the habits of the user; the timing, frequency and level of use of a tool, product or platform; added to the stage in which you are in your shopping journey; and their attitude towards the brand.
Some criteria to use:
- Purchasing reason. What are users looking for? Best price, quality, or great reviews? What difficulty are they trying to solve?
- Chance. Users are often looking for a product for a particular occasion or event. This is a criterion to take into account at the time of segment a contact base .
- Profits. In this case, it is important to identify what benefit potential buyers are looking for: get the latest technology, the safest product, take advantage of the discount, etc.
- Stage of the purchase journey. In what stage is the user? Are you looking for information for a future purchase or are you ready to try the brand’s product for the first time?
- Commitment level. Here we will focus on the degree of customer loyalty. Is it a recurring buyer who also recommends the brand? Are you a customer who used to buy and has stopped?
This class of customer targeting can be used to gain insight into user experience . It also helps you identify potential future customers who are more likely to buy a product.
Psychographic segmentation
To close the list of the different types of customer segmentation that you can apply in your business, we must mention psychography. What is this and why is it important to you? Well, although it may seem that the concept is quite far from the world of marketing and sales, the truth is that it is about one of the key criteria for grouping users .
Psychographic segmentation It involves taking into account the lifestyle, beliefs, personality traits and interests of the users. Unlike the demographic or behavioral criterion, the psychographic allows you to answer why a person buys your product .
What is usually taken into account in this kind of segmentation?
- Hobbies, activities, or interests.
- Habits
- Opinions.
- Personality or attitude.
- Lifestyle.
- Social status.
As we can see, this type of segmentation implies a deeper understanding of the audience.. However, by grouping users in this way, the business can be better prepared to tailor its strategies to the expectations of current and potential customers.
How to classify and segment your customers? Step by Step
You already know what segmentation is and what are the main criteria that you can use to group users in your database. What you still don’t know is how to put all this into practice. In other words How to do customer segmentation? We share the fundamental steps to achieve it.
- Define targeting targets. Every time we segment clients it is important to have a goal to achieve. Define what problems we are trying to solve through segmentation, what we hope to achieve from this activity, what is the desired result. This objective should be as specific as possible and at the same time, measurable.
- Set the characteristics of segmentation. In this case, it is important to establish how many segments are to be created, from what sources the data will be extracted, what tools will be used and what criteria will be applied, among other points.
- Gather the data. The key to constituting each segment is the data, without this information it would be an impossible task. This step consists of extracting this data from the sources that the company uses and bringing it together in one place to classify it.
- Define the types of segmentation to use. In this case, it is necessary to define what criteria or characteristics will be taken into account to segment customers: demographic, geographic, behavioral or psychographic data.
- Develop customer segments. With all the previous steps, we are now in a position to create our customer segments, that is, to distribute the users in each group or category based on the criteria that we have previously established.
Why segment customers?
As we said at the beginning, segmenting customers is one of the alternatives to personalize the user experience. This leads to another advantage: by providing more relevant experiences, the brand can achieve better results. Segmentation is undoubtedly one of the secrets to selling more.
What we must bear in mind is that if a company knows its audience better and understands more precisely what their needs and motivations are, it can create more specific marketing campaigns.. Something like to do one-to-one marketing. The user feels that the brand understands their problem and that it speaks directly to them about what interests them.
If you know who you are targeting, you can implement more effective lead nurturing strategies, incentivize buybacks , and even wake up inactive users .
Likewise, segmentation allows you to take full advantage of marketing automation to automate shipments to each segment , while still personalizing each interaction, but without wasting an extra minute. With Automation you can save a lot of time to grow your business!
In addition, multiple campaigns can be developed, each designed and targeted to a different segment within a larger customer base. It does not matter the size of that listing, You can impact each group with relevant messages that, in turn, can help you close more sales .
As if this were not enough, the campaigns that are better targeted provide another benefit: they allow you to allocate the expenses of marketing actions strategically .
In short, customer segmentation helps to find greater business opportunities, optimize communication, consolidate the relationship with users and achieve better results. Are you ready to implement it?
Do not forget that to implement this kind of strategy you need the right tools on your side. Discover the solution emBlue for your business.
FAQ on Types of Segmentation
What is segmentation?
Segmentation is that technique that is based on dividing and classifying leads, prospects or clients according to some type of interests or characteristics, in order to send personalized messages with strategies for each group.
What types of customer segmentation are there?
- Geographical segmentation
- Demographic segmentation
- Behavioral segmentation
- Psychographic Segmentation
️ Why segment customers?
Segmenting customers is a technique that will allow you to know who and how many people are in each stage of your customer journey, their level of commitment to your brand and their proximity to the purchase or buyback. You will be able to create strategies to move them towards your business objective.