6 Main Benefits of Customer Segmentation in Digital Marketing

Customer segmentation is a strategic marketing tactic that enables marketers to market to customers based on their unique characteristics. Through segmentation, marketers are able to uniquely package and direct their marketing messages and campaigns to the right audience. This is one major advantage of customer segmentation in digital marketing. Through segmentation, marketers can optimize their marketing messages to separate groups of recipients for better effectiveness. When individual customers receive only marketing messages relevant to their needs, it helps to maximize the power of the messages and ultimately their effectiveness.

Following are six main strategic benefits of customer segmentation in digital marketing.

1: Helps to Deliver Personalized Messages

Most marketers know that personalized marketing messages are more effective messages. So, customer segmentation helps them to deliver such personalized messages. These messages largely determine the depth of customer relationship and boost customer loyalty. With personalized messages, customers do feel really special in the reckoning of marketers. That helps to nurture a stronger bonding with customers making it easier to market to them.

2: Yields Higher Returns from Marketing

When marketing messages reach the right audience, they become more effective. Customer segmentation helps to make that possible. Effective marketing messages are great for delivering good returns for a business. So, if you effectively use segmentation to personalize your marketing messages, you get higher returns from your marketing campaigns. This directly helps your marketing strategies to be more effective in delivering higher returns and ultimately a great improvement in your conversions and sales. It can be really great for the bottom line of your business.
 
3: Helps to Cross-Sell and Up-sell Products

Significantly, customer segmentation helps to increase your chances of up-selling and cross-selling products. When marketers diligently examine their audience’s personal preferences and demographic details, they’re better positioned to recommend relevant products to them. Such accurate data-oriented marketing decisions help to make the recommendations more effective particularly in up-selling and cross-selling products.

 
4: Delivers Better Customer Service

No matter the nature and size of your business, customer segmentation provides you the relevant data to better understand your customers. If you understand your customers well enough particularly in their personal details and preferences, you can streamline your marketing approach based on the data you have and consequently market to your customers better. If you carefully evaluate the purchase journey of your customers, you can easily identify their hassles or pain points. By taking positive steps to address these issues and smoothening up their journey, your audience is likely to go through a smoother purchase journey next time around. This can be great for your customer service.

5: Enhances Better Price Optimization

Accurate and relevant data obtained from customer segmentation can help marketers to identify their ideal/model customers. This data can help the marketer to determine what prices customers are willing to pay for a product. Doing so helps marketers in optimizing their product prices. Smart marketers can thus capitalize on this pricing data to test different pricing options to find out the prices that best suit the type of products they are marketing.

6: Helps to Focus on Profitable Customers

One major advantage of customer segmentation for marketers is their ability to prioritize the most profitable customers. Segmentation data helps marketers to know the customers who are more interested in their products. When marketers package special marketing messages and tactically approach these customers, they get better results largely because of repeat purchases. It is such customers you can deliberately nurture to grow your business.

Final Thoughts

No doubt customer segmentation helps marketers to do more and better business. So, if you want to stay competitive in your niche industry, you must understand your customers very well. Customer segmentation is one great way to do so. Therefore, if you really want to boost your marketing campaigns, make sure you use the right customer segmentation tools to bolster your campaigns. Doing so will ultimately deliver a more effective marketing orientation that is growth-prone to your business. 

Why Customer Segmentation is Important in Digital Marketing

If you want to be a successful digital marketer, you must at all times understand the perspectives, expectations, and behavior of your target audience. Your audience is composed of human beings with distinct individuality which affects their distinct behavioral patterns. This is what recommends customer segmentation as a requirement for effective digital marketing. But, as a marketer, you cannot effectively use customer segmentation if you do not fully understand what it entails.

 
Now What Does Customer Segmentation Really Entail?

Customer segmentation is a strategic marketing tactic that enables marketers to market to customers based on their unique characteristics. With it, marketers can categorize their audience by way of their unique psychographic and demographic characteristics. Doing so enables marketers to uniquely package and direct their marketing messages and campaigns to directly target specific customer groupings. This way, the right message gets to the right audience thereby increasing the effectiveness of your marketing messages. This ultimately helps marketers to optimize their messages to each group for better effectiveness. By so doing, individual customers would receive only messages relevant to them. This helps to maximize the power of the marketing messages and ultimately their effectiveness.

You’ll get to understand this well when you consider the commonest parameters for customer segmentation which include:

•    Demographic Categorization: This takes location into account in categorizing. So factors like where you reside comes into play. Whether you reside in rural, suburban, or urban area takes center stage here.
•    Personal Attributes: These are factors unique to the individual customer. You can thus target your customers based on gender, age, educational status, marital status, state of life, languages they speak and so on.
•    Shopping Records: This involves evaluating the shopping records of the customer, customer behavior, responses to product promotions, frequency of shopping, and the volume/value of purchased products and so on.

If you understand these parameters well enough, it will be easier for you to segment your customers, market specific messages to each group and get better results from your marketing campaigns.

Next is to consider the strategies that help make customer segmentation really effective in marketing. Therefore, if you are able to categorize your target audience based on the following parameters, it can help to make your marketing campaigns more effective.

1: Behavioral Segmentation: This customer segmentation strategy is largely based on customer behavior. It takes into account the customer’s lifestyle, personal preferences and habits. Marketers can diligently study the purchasing habits of their customers by harvesting data from different online media platforms. This data can give marketers accurate insights into how different age brackets for instance shop, what they shop for and their social media hangouts. When marketers know the buying behaviors or shopping patterns of their customers, they can then recommend special products to meet their needs.

2. Demographic Segmentation: This involves categorizing your audience based on their geographical locations. It is premised on the reasoning that people from a common location are likely to share some basic traits. So, when marketers have accurate data on the location, religious beliefs, educational status, marital status, age, gender and demographics, they can personalize their marketing campaigns better for customer targeting.
 
3: Customer Journey Segmentation: Customer journey segmentation focuses largely on the different stages of the buying pattern of a customer. The reasoning is that each stage of the customer journey requires specific marketing messages suitable for the stage. This is because at every stage, the customer/potential customer engages with different elements on your website. Elements like content, CTAs, product images, descriptions, etc. come into play. Customer journey segmentation helps marketers to identify the pain points and behavioral patterns of customers in their buying process. This information helps marketers to device ways to streamline and smoothen up this journey for the benefit of their customers.
 
4. Psychographic Segmentation: Psychographic customer segmentation largely focuses on the personalities of customers. It involves using psychographic information about your customers to categorize them based on their attitudes, behaviors, and opinions. As a marketer, if you diligently observe your customer interests and opinions, you can clearly identify their way of life and what they like to do and how they choose to do it. Accordingly, you can carefully design your marketing campaigns specifically for such way of life.

Last Line

Marketers choose customer segmentation to enhance their marketing campaigns for better results. Optimizing your marketing messages and directing them to identified groups that need the messages most helps the effectiveness of such marketing messages. This is the reasoning behind customer segmentation.