If you’ve ever tracked your customers’ interactions with your brand from start to finish, you probably noticed one thing: not all of your customers are created equal. Each of your customers has a different relationship with your brand, so if you want to turn them into brand advocates you need to meet your customers where they’re at. The best way to do this? Segmentation. Using customer segmentation, you can group customers based on the way they’ve interacted with your brand in the past to better predict and guide their actions in the future.
Not sure how to begin marketing user customer segments? We’ll walk you through the process!
Step 1: Identifying Your New Customer Segment
To group your customers into valuable segments, use customer data to answer key questions about their interactions with your brand:
- Are they a one-timer purchaser?
- Could they become a customer for life if nurtured correctly?
- What are they engaging with on your site?
- Are they connected with other potential purchasers?
- Could they become a brand ambassador for you?
With in-depth analytics, you can segment these different types of customers based on their behavior, expected future spending, and influence patterns. Having clearly defined these customer groups, you can then target different segments with relevant messaging and promotions.
Step 2: Segment Your Audience Based on Value
Even though there is no single “correct” way to segment your customers, there are a few common methods that can help you find the right approach for your brand.
1. Segment Based on Purchase Behavior
There are a wealth of purchase behaviors you can use to segment your customers! By categorizing your customers into segments like purchase frequency, product types purchased, and order values, your business can uncover strategic promotional opportunities.
For example, you may realize customers who purchase a particular item are the most likely to purchase again. To take advantage of this, you can launch marketing initiatives that encourage more new customers to purchase this same item. Keep in mind, however, that correlation does not necessarily indicate causation. Be sure to cross-reference any customer segment to confirm patterns in customer behavior!
2. Segment Based on Site or Ad Interactions
If you can identify common motives across your customer base based on their online interactions, you can cater your content to target these motives. Your customers’ engagement with your content tells you a lot about their relationship to your brand.
Consider a customer who visits a page detailing the functional features and benefits of your product or service - this behavior may be signaling their primary purchase motivations. This customer may be most interested in the functional benefits of your product, and as such you can send them an ad with targeted messaging. This a great example of how to take the way a customer interacts with your content and turn it into high-value customer segments that would otherwise go unseen!
While investing in highly customized segments and the creation of targeted workflows takes time, your customers will appreciate your effort to better understand what they’re looking for. This investment is likely to result in an increased customer lifetime value across the board!
Step 3: Reward High Value Customer Segments
Your top-spending customers are extremely important to your business. To ensure they feel recognized, consider incorporating a rewards program into your retention strategy. With rewards in the picture, you can make sure your loyal customers are recognized for their commitment while also moving customers in other segments along their journey with a clear incentive.
Ultimately, the objective is simple: reward your best and most influential customers, and encourage all customers to reach the same status. High value customers deserve high value rewards -- special offers, exclusive products, and VIP experiences are only a few examples of rewards that deliver an enhanced feeling of exclusivity and scarcity!
Customer Segmentation is Evolving
With advanced access to customer data, your online business has much more information about your customers than retailers had in the past. New tools allow you to track customer behavior across various platforms, creating opportunities for in-depth analysis of how your customers are interacting with your content. As a result, your business can customize messaging and provide personalized experiences at scale. This is a luxury traditional retailers didn’t have!
Don’t be fooled, though. While deep segmentation and personalization are more efficient than they used to be, it still takes significant time and effort to unpack and understand all of this data to develop customized marketing plans. Get yourself the right tool kit, and start digging for value!
This guest post was written by Kenneth Ott, co-founder of Metacake.
Metacake is an ecommerce growth team helping some of the top brands in the world unlock revenue online.