It doesn’t matter how particular your brand’s niche is, each of your consumers is an individual and has their own identity – and their behavior justifies whether they need to be approached the same way. That’s where customer segmentation comes into the picture.
However, to serve every customer individually is nearly impossible, but if you do segmentation of your customer based on a few characteristics, it may help you get closer.
What is customer segmentation?
Customer segmentation is an excellent practice for a better understanding of your customers, and dividing a customer base in a group of similar individuals in specific characteristics or features eases the approach.
The most common ways to segment the customer base are:
- Demographic Base: In the demographic base, the core of segmentation is on age, gender, inheritance, income, education, occupation, and marital status.
- Geographical Base: This characteristic is depending upon the business size as well. If the business is on the local-scale, the segmentation will happen as per the town or country. In contrast, for large-scale businesses, the segmentation will depend upon city, state, or countryside.
- Psychographics Base: In the psychographics base, the core segmentation is on the lifestyle, personality attributes, and social status.
- Behavioral Base: In this base, the segmentation center of segmentation is on the usage of products and services, spending habits, desired benefits, and consumption habits.
The segmenting your customers and with a better understanding of these aspects, a business can get appropriate knowledge about who your customers are and how you can engage them for the benefit of your business or better conversion.
What is the importance of customer segmentation?
Customer segmentation in today’s business world is not a suggestion but a necessity. In this part of the article, we will have a close look at the advantages of customer segmentation and how this practice will benefit your business:
Enhanced Concentration: The more information you have about your customers, the better you can serve your customers, enhancing customer experience.
By unscrewing and analyzing the data, you get a better understanding of what your customer is looking forward to using your products and services.
Doing this will enable you to fine-tune your product as per the requirement of your customers. Make your customers feel special as you created this particular product, especially for them.
Join The Race: Customer segmentation enables a business to be active, confident, and aggressive for the growth of your business. When a company has got all the required information about customers’ needs, it’s easy for them to grow and be in competition.
Since you know what the critical point is for customers to buy your products or services, you can go ahead and hit the hammer, which will lead to an increase in sales and business revenue.
And when your business has high revenue or returns, you join the league of the competition where you concentrate on reaching the best rank.
As your company grows more famous and know to the audience, the more potential customer you will be able to attract towards your brand.
This article is part 1 on the topic. Please go through the second part of the customer segmentation blog to get more information.