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Cory Plachy | February 15, 2024 |
Being able to ensure customer success is contingent upon having a great relationship with your customers. There was a time when a business’ options were limited, whatever the company size, to putting a few static ads out on mainstream media and staffing a phone center.
Now, the potential for constructing and maintaining robust relationships with customers is greater. This is because of the ability to target certain groups of customers with communications that are most relevant to them. Today’s customer benefits from a more meaningful and pertinent relationship with the business. How is this achieved? Via customer success segmentation.
Think of a large group of your customers. They will have certain things in common. They are economically active, for one thing. They like your products, for another. But even more important than what binds them is what separates them into subgroups.
Every customer base will have customer segments with common characteristics within it. You can issue customer communications in the same manner across all these different groups, and you may manage to effect a reasonable amount of customer engagement, and customer success therefrom. You might even improve the ways customers can access you with up-to-date call routing solutions.
However, consider how much more effective your communications will be if you can tailor them to the particular groups within your customer base. If you can adjust your messaging, tone of voice and channel used in order to engage with certain customer groups, you’ll stand a much greater chance of having a customer success result.
What do we mean by customer success? It can be envisaged as follows:
As we can see, customer success is a dynamic flow. Its vitality depends on active communication with the business (often with customer success teams). This is done via social media, email, websites, print, and many other channels. It applies whether we’re considering new or existing customers, buying new products, or experiencing issues with product usage.
At all stages of the flow, a business will be able to conduct communications that are optimized for relevance and effectiveness if they adopt a variety of customer success segmentation.
Customer success segmentation comes in a number of different forms.
Demographic segmentation is what most people tend to think of first when they are thinking about customer segmentation, whether we are segmenting for B2B e-commerce or the restaurant sector. It’s a practice based on dividing a group of customers up into subgroups, based on a general characteristic. This general characteristic might be age, location, gender, income, occupation, or ethnicity.
This is an analysis based on assessing customer behavior. There will be no or little attention paid to the particular circumstances that apply to that customer. Instead, the spotlight is simply put on what they have bought, or considered buying, how much, and when. Behavioral segmentation can segment customers according to where they are on the customer journey, for instance.
This is a portmanteau expression denoting both psychology and demographics. The idea is to focus on attitudes, beliefs, lifestyles, hobbies, and values. These kinds of qualities can be useful determinants of buying intentions. They can also, crucially, cut across demographic boundaries.
This stands for Recency, Frequency and Monetary segmentation. It looks specifically at how long ago a customer has interacted with the business. This can be online, over-the-counter, or with hybrid shopping. It also looks at how often, and what level of spend is recorded.
This segmentation form isn’t concerned with the values of the customer (that’s covered by psychographic). Rather, this is to do with the economic value of that customer to your business. Especially valuable customers can be defined as such because of frequency and/or level of expenditure.
It’s useful to consider this aspect sometimes, especially when thinking about the impact of certain developments, such as reorganizations and menu changes.
There are a number of ways a customer segmentation model can help your business grow. Here are four of them.
It’s no secret that retail is being revolutionized by the impact of personalized customer experiences. This is particularly the case with younger customers.
So, the lesson is clear. Any business that wants to have good levels of customer success needs to think about personalization. This is usually in the shape of customized offers, but can also simply be using a call scheduling tool in order to reach out at the time that best suits the customer.
Of course, personalization is hugely important in restaurants. It’s completely fine just to get a great menu together, with the highest-quality ingredients and the best levels of service. You can do that and hope that customers find you. However, you can help yourself so much by coupling that attention to detail on site with an attention to detail with your outreach.
By breaking your customer base down into behavioral groups, for instance, you can shape your communications to reference their tastes and gain their attention.
Customers appreciate the effort. However, do be careful. The flipside of personalization can rear its ugly head if your segmentation system has errors in it. The damage done to your relationship with vegan customers when you send them discounts on veal chops cannot be overestimated.
To further enhance personalization, consider incorporating email marketing campaigns tailored to specific customer segments. Email marketing allows you to deliver highly targeted content and promotions directly to the inboxes of your segmented customer groups, increasing the chances of successful engagement.
Segmentation allows you to reach a greater comprehension of who’s buying from you. You can learn not just who’s buying, but exactly what they’re buying. It can also help you to understand consumer trends.
By looking at psychographic segmentation data, for instance, you can glean a good picture of customer preferences. This can then help you not just to aim particular elements of marketing and customer support to particular customers (ie as in the personalization route we just covered) but also to position your business accordingly.
Say you know your customers value qualities such as high street presence and fresh local ingredients. You might decide that a new out-of-town branch that’s more fast-food-centered might not be a big hit with your established client base.
As any enterprise risk management system will tell you, suboptimal marketing strategies can be a damaging waste of money. When budgets are tight (and, let’s face it, they often are in food and beverage), you need to make sure that every cent you spend on marketing is a cent well spent. Being able to target your marketing so that it reaches and resonates with a particular customer group will give you a better return on your marketing spend.
It’s the same with your customer support operation. Anything that can be done to make its customer communication more effective will be a good ROI.
By fine-tuning the message so that it’s more meaningful to a particular kind of customer, you reduce the chance of your message being ignored. Moreover, by using a channel that’s more pertinent to a particular customer, you give your communication more relevance.
For instance, if you want to make a splash with Gen-Z customers, consider using Instagram or TikTok. They have better reach with this demographic and more credibility. Or, if you’re in a B2B scenario, you might want to look into voicemail drop marketing, a strategy where pre-recorded voicemails are delivered to potential clients' voicemail boxes.
Attracting fresh customers is what every business needs in order to thrive. However, it’s also imperative to have effective customer retention. Why? Because current customers are more likely to buy and spend more than new customers. This is why loyalty programs are such a big business right now (70% of customers seek them out).
Using customer success segmentation allows you to target loyalty programs at customer subgroups, perhaps highlighting menu items that will appeal more and offering bonus loyalty points as appropriate.
You can use customer success segmentation to enhance the customer experience in all sorts of ways, in order to improve loyalty and trust. A popular one is to send a product offer based on the customer’s birthday, for instance.
Additionally, by implementing brand monitoring strategies, you can keep a close eye on how your brand is perceived within each segment, allowing you to address any issues and maintain a positive image among your loyal customers.
So, we can see that using a customer segmentation strategy will benefit your business by giving your customer communications more potency. We’ll finish with some best practices:
With the right application, customer success segmentation will give you and your customers great results. You should really start using it today.
This content was contributed by Cory Plachy, senior marketing and communications manager at Convoso, the leading contact center software for powering sales and lead generation As an adaptable and naturally curious manager, Cory channels years of content creation, marketing and sales experience into the world of SaaS communication.
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