Why segment your customers?
Dividing your customer file into homogeneous groups has many advantages in marketing efforts, segmenting your customers is therefore a key performance factor.
Why segment your customers? What is segmentation?
Very often, the knowledge you have of your database corresponds to the image you have of your average customer. The objective of segmenting your customers is precisely to “break” this relationship with the average and to identify different groups of customers through segmentation.
Segmentation is defined as the action of dividing a population (customers, prospects) into homogeneous sub-groups according to different criteria (sociodemographic data, purchasing behavior, etc.).
The segmentation criteria chosen must make it possible to obtain segments of homogeneous populations of sufficient size and operational. The main objective of segmentation is to understand the similarities between customers in the same segment and the differences in behavior between the different groups.
Segmenting your customers: a key performance factor
Marketing segmentation is an essential strategic step that will allow you to optimize your marketing efforts, to better satisfy your customers and therefore to increase your profitability. In particular, segmentation will bring key benefits that will increase performance.
Segmentation to help customization of the customer relationship
Firstly, segmentation will allow a better customization of the offer and messages to existing customers. Indeed, a well-constructed segmentation will allow to identify distinct groups of individuals in terms of consumption and profiles. We can therefore move from mass marketing to segmented marketing.
This first point will have a direct consequence: the improvement of the global performance. Indeed, by having more targeted speeches, closer to the expectations and needs of customers, we will be able to increase the overall performance of our animation plan. As a general rule, without any other optimization tool (scores for example), segmentation can lead to an increase in sales of around 2 to 5%. This obviously requires a reflection on the animation strategy to be adapted to each group according to the problems to be solved: increase loyalty, fight against attrition, improve customer reception and the commitment of new customers, boost reactivation…
Adapt and reduce your commercial pressure
At the same time, customer segmentation will allow you to better adapt your commercial pressure to the different groups. By analyzing the needs and expectations of the different customer groups, it will be possible to define the optimal commercial pressure and send only the necessary messages. Beyond the economic (and environmental) impact of a reduction in the number of messages sent, this will also have a positive impact on customer satisfaction, as they will perceive the brand as more attentive to their needs.
Optimize available resources
More generally, segmentation will also allow the company to better allocate resources. By having a more precise vision of the profitability of each group, it is indeed easier to define the right rate of generosity, to adapt the types of promotion, to manage the time to be spent by the sales representatives on such or such target… In short to define the means adapted to each group of customers.
Define your target audience to increase your brand awareness
A better control of your customer knowledge resulting from the segmentation will allow you to better know your core target. As a result, institutional and general public communication will be better adapted to its target. It will therefore be more effective and will increase the brand’s awareness among your target audience.
Strengthen your acquisition strategy
Finally, the segmentation of your customers will allow you to optimize your acquisition strategy! For example, when you set up a digital acquisition strategy, if you base it on the average profile of your customer file, you will recruit very loyal customers, occasional customers and future inactives without distinction. By focusing your strategy on the best customers of the segmentation, you will probably recruit a little less but in a more targeted way and therefore more profitable in the long term!
How can datacadabra help you?
Within datacadabra, the Segment module allows you to build different types of segmentations based on your available data.
Want to know more? Do not hesitate to contact us or to ask for a demo of datacadabra.