customer segmentation

To segment your customer base, three things must happen: First, there must be a clear understanding of your target clients, what demography do they belong, where are they coming from, what do they truly care? Then figure out what type of clients are they. Are they paying clients? Old clients?  Demanding clients? Friendly clients perhaps? Returning clients? Then, you need to be able to make them the center of your business. After all, their need is the reason why you have the business.

The segmentation points mentioned are easier said than done. You need a really good and accurate analytics tool to allow you to decide better for your company. If yours does not offer store analytics data from your back end.. google analytics – though limited – might do. Contact us if your want to manage your store analytics data from your back office. Assuming your ecommerce system have one, let’s go through the steps on how to do customer segmentation.

#1. Start With Understanding and actually listening to your client

Organizations that pay attention to the customer voice have better customer experiences and the benefits of those are countless. Here’s some:

  • Companies that have high promoter skills grow faster.
  • Companies with great customer experiences have a 16% price premium on products and services.
  • 69% of U.S. online adults shop more with retailers that offer consistent customer service both online and offline.
  • 67% of customers are willing to pay more for a better customer experience.
  • After having a positive experience with a company, 77% of customers would recommend it to a friend.
  • 65% of U.S. customers find a positive experience with a brand to be more influential than great advertising.
  • Satisfied customers are more likely to upgrade or add services and are less likely to cancel.

Essentially, listening to customers is a priority that leads to higher retention rates and an increase in revenue. We can put up products that is out-of-this-world-really-good. But without people accepting your product as a product that adds value to them on a personal and social level,


#2. Place your clients at the center of your business

Most ecommerce company would outright say they are a customer-centric company. But are they? Let’s take a close look and ask on how a company can become customer-centric.

What is the reason your company exist? What is your story? If your story is about you, and how good your company is, how awesome is your staff? How beautiful your company building is? Then you have missed your target by a mile. Of course those things are important too! But your reason should be your target. And your target is your client. Your passion should be that, there is a need that should be fulfilled – a pain point that must be resolved. And you want to put your company in a position to provide that resolution, right?

A really good and practical way to do this is to make sure the services you offer are the services your client truly values. Because if it is not, nobody is going to buy your services or product!  Sometimes it is just a matter of how your offer is presented. If you can offer your product as an added value to the life of your customers, then you have a market. You have resolved your client’s pain point.

Now you can talk about cost of obtaining them or pricing strategy to use to make your services or product commercially viable.

#3. Understand the types of clients

Everyone of your customers can be divided into some kind of stereo-types. There are four actual types of clients, namely:

  • dominating clients – deals in absolutes and doesn’t tolerate mistakes
  • socializing clients – likes to talk a lot and love to make new friends
  • analytical clients – asks a lot of detailed questions
  • relatable clients – sentimental but can hold a grudge

Understanding where your clients falls is huge for your company. These information can be readily available with an analytics tool in your back office. Again, if your ecommerce system does not allow you to manage these kind of data from your backend, use the contact us page to let us know.

These analytics data will be useful for sales managers, project managers, business owners and anyone who needs to engage in negotiations from time to time. So, as a store owner, manager, you really need to have access to these tools! Don’t be left behind! Give us a call or contact us!

So, the first thing you do to understand your client is to identify your ideal client profile. Don’t just stack them all inside one box. Be clear about your propositions.

There is also the need to determine the cost of acquiring these clients. Costs like running an email marketing, or a social media ads, or perhaps google ads. Or just the cost of running a solid and long term SEO to reach these clients. Your service offering and fulfillment will basically rest on those information. And possibly your company’s future!

What benefits does segmentation do to my business?

We have gone through 3 steps to do segmentation, but does customer segmentation really provide benefits to my online business? The answer is clearly a BIG YES!

The number one benefit of customer segmentation is, it allows for the effective allocation of marketing resources and the maximization of cross- and up-selling opportunities. Once you are able to determine what types of clients you have, and where they are coming from, and what are they looking for – it becomes easier for managers to make decisions as to where the company resource should be channeled into.

Secondly, you will be able to use personalized messages as part of a marketing mix that is designed around their specific needs. It’s easier for companies to send those customers special offers meant to encourage them to buy more products.

Lastly, customer segmentation can improve customer service and assist in customer loyalty and retention. It keeps you a step ahead of competitors in specific sections of the market and in identifying new products customers could be interested in or improving products to meet customer expectations.

In conclusion

Customer segmentation has grown since people took analytics data to be an integral part of doing business. We cannot stress this enough: You can only do customer segmentation if you knew who your clients are, understand why they are with you rather than somewhere else, and you are able to place them at the center of your business. And ALL of these propositions are dependent on analytics data. If you don’t have one, Go get it NOW!

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