For the uninitiated, customer segmentation is the practice of dividing a customer base into groups of individuals that are similar in specific ways, for the purpose of more intimately understanding them.
One of the largest benefits of this is being able to craft more relevant sales and marketing offers, by taking into consideration defining characteristics such as age, gender, interests and spending habits.
Put simply, if you know what type of person is buying your products or services, then you know what type of person to sell to.
Of course, understanding who your target audience is, is not enough in itself. You also need to know where they are.
This type of insight has officially transitioned from a nice-to-have, to a need-to-have.
The good news is, there’s no shortage of dataset available to help you pinpoint the answers to these questions. But the challenge remains – how do you make sense of all the data available to you, and choose which data to scrutinise?
Be warned, just because you can now ingest all sorts of data, doesn’t mean you should. Irrelevant and incorrect data will flood your systems and be the death of your insight.
Before you start loading data into your systems, there are some business-critical questions you should ask yourself include:
How current is the data?
Where is it coming from and how is it collected?
Is this information actually relevant to my business?
Will it help answer the question of who my customers are?
Will it provide meaningful insight into how I can find more customers?
If you’re interested in undertaking customer segmentation, I recommend connecting with a data analyst. They can provide you with insight into not only what commercial data is available to support your objectives, but also give you advice on how to best scrutinize your own data stores to derive the answers you really need.
To get started with your customer segmentation, send us a quick enquiry or call 02 8436 2800.