Take a minute to think of your business’s customer base. Do they all like exactly the same things? Do they all come from the same background? Chances are, not likely because your customer base is made up of many different types of people. These people have varying wants, needs, and traits. Above all else, they interact with your business in different ways. The most effective way to communicate with them is to break them down into groups. That way it will be more manageable for you and you can meet their expectations.
User segmentation can improve your marketing efforts by identifying and organizing your customers into bite-size groups. So it is not too much for you to chew and your groups can receive the right attention. We will guide you through what user segmentation is, why it is important to segment customers, and how to segment customers into groups.
What is User Segmentation?
User segmentation is the process of dividing your entire user base into groups based on shared characteristics. All your customers have a desire for your product or service. Besides that, you will notice that your customers behave in different ways and possess unique qualities from each other. By grouping users together, you will be able to tailor your marketing efforts towards the needs of each group. Customers will become more receptive to your business and lead to greater conversions with this approach.
User trends indicate that 81% of consumers want businesses to understand them better. However, many marketers are still struggling with how best to personalize content and experiences for their customers. That is where user segmentation comes into play. By breaking down your customers, you can deliver the right message to the right group.
Why Segment Customers?
Segmenting customers into several smaller groups may sound tedious at first. But by doing so, your business becomes more sustainable in the long term. You will allocate resources more efficiently and develop an improved marketing strategy. Your marketing efforts will be more focused on targeting relevant consumers, rather than casting a wide net and hoping it catches something. This will save you time and money.
If you segment customers properly, you may even notice new groups of customers. Now you can attract these customers to grow your business. More so, you may realize through user segmentation that certain campaigns were wrong for some of your groups. Your business is ever-changing. With the right knowledge of your customers, you can refine your brand appropriately to appeal to your groups. Additionally, you will be able to enhance and expand your product or service offering.
Most importantly, segmenting customers helps you to better meet their demands. Each group of customers will want to be communicated with differently. User segmentation will help you deliver the right content through the channels your customers want. Do not bombard them with messages they do not care for or send them through channels they will never look at. Overall, you want to reduce churn by providing the best experience for your customers. All the same, you will increase customer loyalty and retention. User segmentation identifies the customers with the highest potential value. It is best to give these groups a little more attention.
User Segmentation Model
To begin with, you will need to acquire information on your customers. This information will then be used to break them down into groups or “user segmentation models.” Before we get into what those models are, think about the info you already have on hand and new ways to retrieve consumer data. A sign-up form can be an inexpensive and easy-to-implement method. You can also review previous transaction data and see what you have obtained from your customers that way.
In general, you will need to find basic data on your customers. For example, you can find out geographical information like shipping and billing info and the store location of their purchased goods. But take it one step further and find the specific products or services that were purchased and their payment method. Was this the customer’s first purchase? Or have they previously been to your business? Did they find you through your website or an advertisement? Regardless if you have all the answers to those questions, the more consumer data you have, the more effective your user segmentation models will be.
Once you have collected a sufficient amount of information on your customers, you are ready to segment them into groups. Below, we will cover different user segmentation models that you can utilize. However, some models are more complicated than others. Again, consider the data you have and will be able to obtain when choosing which models are right for your user segmentation strategy.
Demographic segmentation is the most common user segmentation model. This is because this information about your customers is typically the most accessible. Despite its ease, this one should not be overlooked as it represents the core qualities of your customers. Age, gender, income level, education background, and marital status are all vital in how to segment customers appropriately.
These traits are softer and a bit more complex than demographic traits. Psychographic segmentation involves a customer’s attitudes, beliefs, personality, interests, and values. A great way to obtain this type of information is through consumer surveys. For instance, ask your customers how they feel about your products or services. See if they strongly agree or disagree with certain statements. The psychographic user segmentation model can be hard to measure and quantify. Even so, this segmentation can provide valuable insights into your brand. If you succeed in creating content and campaigns focusing on this user segmentation, you will hit your customers where it matters.
Of course, if you are already using an analytical platform like Google Analytics, you are ahead with this user segmentation model. Behavioral evaluates a user’s actions and engagement. Measurements include but are not limited to login frequency, website visits, session duration, and pages viewed. You know there are several more metrics analytical platforms provide, so start using them to your advantage.
User Segmentation Model Factors
The models we just covered encompass many characteristics to create a user segment. While you may like a broad segment, there are cases when honing down on a specific factor may be better. Let us discuss a few key factors to consider when creating a user segmentation.
Technographic factors consider what technology the customer is using. Depending on the goal of your campaign, you may want to solely target mobile users over desktop or vice versa.
Geographic factors can range from broad to niche populations. International businesses may want to place a greater emphasis on a specific country, possibly one that is doing exceptionally well or could use more attention. For a local business, targeting towns or counties the business serves will have better results than cities in the state over.
Needs-based factors are the customer group’s requirements of a product or service. By acknowledging your customer’s specific criteria, you will be able to improve your business and position your brand accordingly.
How to Segment Customers
Now that you are more familiar with the many different user segmentation models, you are ready to improve marketing efforts. The first step in how to segment customers is to have a concrete goal in mind. You would not be segmenting your customers just because. That would be wasting your time and money. Hence, go back to the reasons you considered for user segmentation and think about your desired outcome. By having a clear goal in mind, your user segmentation strategy will be more solidified.
Then with your marketing objective created, choose the user segmentation model that is right for the task. Different models focus on different characteristics of a customer. Be sure to pick a model that is aligned with your goal. And do not feel afraid to use a mixture of the models and factors together. As a result, you may create a more established user segmentation.
With your customer base segmented, develop and direct your marketing efforts towards the groups. Customers have a certain expectation of brands to deliver the right content to them. They are looking for more personalized and targeted outreach from your business.
Boost Your Business With User Segmentation
Almost no business will successfully accomplish user segmentation on the first go. Even the most established brands are constantly refining their segmentation strategy. Always analyze the new data and information you receive and adapt your plan. Consumer preferences are everchanging so adjustments will need to be made. Using analytic platforms or user segmentation software will assist you in having the most up-to-date data.
Knowing how to segment customers properly is all about understanding who your customers are. You probably have a lot of different types of people in your life from friends and family to coworkers. All of these groups have different wants and needs. Not surprisingly, you communicate with them differently too. Your business’s customers are just the same too.
Go and obtain data on your customers to know which groups they belong in. Then you will be able to send them the right message at the right time. Analyze how your marketing efforts did and do it all over again. Need help figuring out who your customers are? SEO Design Chicago’s analytics data team is here to interpret your data to drive the most revenue back to you.
- What are the different types of user segmentation models?
- What are the benefits of segmenting customers?
- Where to find user segmentation data?
- What factors to use in user segmentation?
- What content to send to user segments?