Customer Segmentation Landscape
Growth of business can be achieved if proper customer segmentation is done as it will help you to align the needs and wants of your target customer or your niche with proper subcategories of your customer additionally a business will have the right customer at the right time, at the right place.
What is Customer Segmentation and Why It’s Key to Digital marketing Success
Customer segmentation acts as a roadmap to categorize customers into different groups of customers of other characteristics like age, gender, and occupation to help businesses to identify different categories properly, additionally align business offerings to customer needs and wants and also help the company to index the various customer groups which can be properly accessible when there is need to restructure the marketing style or products.
Customer segmentation is the process of analyzing customers in depth by going through different small or big groups that consist of customers who are further selected by the business according to their niche and offering in the markets, as a company can get a higher number of sales figures just by figuring out customer thoroughly each of their pains, a higher sales can be further achieved by understanding the customer and that can be possible through properly differentiating customer according to similar taste and preference.
Customer demands and customer perception are huge and require in-depth monitoring of customer shifts in demand to complete all customer expectations business needs to divide customers into micro-groups so that it can enhance the customer experience by taking care of all customer expectations and creating a win-win situation by satisfying all the groups of customer separately.
Customer Segmentation: Why It’s Key to Digital Marketing Success
Customer segmentation is required to serve micro to macro groups and Digital marketing is an advanced form of marketing that can be done 24*7 and from anywhere to any of the market as it has a huge advantage when it comes to reaching which can be unlimited to any part of the world where the term internet exists which ultimately connects to the other part of the world.
Digital marketing helps to divide small groups with the same traits. Further, it helps to serve that segment with the possibility of measuring the outcomes of marketing which can effectively summarize the ROI of the marketing budget.
Top 4 Customer Segmentation Strategies to Boost Your Digital Marketing ROI
Understanding the Basics of Customer Segmentation for Business Growth.
Customer segmentation can be divided into several categories, grouping individuals with similar tastes and preferences into smaller, more specific segments:
Demographic Segmentation – is the process of grouping customers based on Age, gender, income, education level, marital status, occupation, and family size.
Geographics Segmentations – it is based on different areas, localities, and localities which will help to take advantage of doing business based on the regional domination products, or natural resources which are different for different regions.
Psychographic Segmentation – It is a group of customers based on lifestyle, values, and personality traits that can be further divided into Interests, hobbies, social status, opinions, attitudes, and lifestyle choices. This helps businesses to understand groups of customers by creating personalized marketing strategies that resonate with customers’ values and lifestyles.
Behavioral Segmentation- it is a group of customers that is based on their behavior towards products or services, it can be understood through examples like Purchase history, product usage, brand loyalty, buying frequency, and customer journey stage. Which further helps identify loyal customers and offer them exclusive deals.
Demographic Segmentation in Digital Marketing: Targeting the Right Audience
Demographic segmentation plays a vital role when it comes to the segmentation of customers as it divides customers based on age, gender, income occupation which gives an advantage to digital marketers to target specific customers. Let’s see with individual traits of the customer group:
Age – Different age groups require different categories of products and service and their buying behavior changes as pass different age groups, a born baby requires proper nurturing as they are very sensitive to the atmosphere, and whether so they require hygiene products that can protect a child but the best part is here that the buying decisions depend on their parents/guardian so here the target customer will be not the child but their parents who are decision makers and this process is generally til the age of 12-14 age groups peoples.
Here, digital marketing plays an essential role by targeting the right audience through different channels of digital marketing tools to target the right audience, Digital marketing will be targeting only the group which are going to be parents and the parents of the age group newborn to the age of 12 by selecting this particular group of people on different platforms whether its google or social media apps where the demographics data is easily available and which can be used to target groups that a business can serve and have an effective marketing campaign for those group only with a centralized focus on needs and demands of customer and can generate win-win situation.
Mastering Geographic Segmentation for Localized Digital Marketing
Geographic segmentation is generally used to target customers by making groups of customers of specific areas, localities, and regions this is important to do because the different region has a different requirement based on the region’s natural resources and climate conditions as their tastes and preferences can be different from another part of the world
we are much aware that different regions serve different food with their specialty in their food ingredients, as we also know that wheat is a staple in northern India the south favors rice to eat more to availability and climate conditions and now they have adapted habits of eating rice more aggressively then northern India so digital marketing for the south region of the food industry will be based on centralizing focus on the base of rice products.
Further, it assists in carrying out localized digital marketing by well-defining keywords that will be based on targeting the consumers collectively of those who requisites of particular demand that will enable to produce different campaigns to attend consumer expectation of that particular region.
Online marketing can be mastered by targeting groups of different regions as we know Mac McDonald’s serves different variety of products for Indian consumers that meet the demands of Indian consumers as they prefer to eat potatoes more than any other stuffing buyers. it is based on a regio-centric approach that comes from the EPRG model which suggests that any particular business strategy like operation, marketing, and many more should be strictly based on the specific region based on ethnocentric which means one strategy through the nations and regions.
Psychographic Segmentation: Creating Personalized Digital Marketing Campaigns
Personal values. attitudes, interests, and lifestyles separate the campaigns and targeting of customers in various styles as the tone of the campaign needs to be altered based on the buyer/seller’s personal information and in this segmentation process which is based on creating personalized marketing campaigns that need to monitor an individual very closely and which can be challenging as this information is mostly a private property of consumers which need to be taken very carefully without disrupting privacy on any consumer.
It is very sensitive as values can be different from even very small groups of consumers while attitudes and interests have a very deep range because no defined categorization of attitudes and interests and that can be changeable as time passes.
Online marketing can be done by using Google Analytics and social media tools to target groups that have similar interests, values, attitudes, and lifestyles in a way that looks like it is done to grab the attention of each individual so that it feels more personalized interactions with consumers.
Let’s understand this by analyzing the lifestyles of consumers if a buyer has to have a lifestyle that is based on working remotely and following the routine of a healthy lifestyle then the requirements of this particular customer will be categorized based on two words a working remotely profession and a healthy person so now the products suggestion is based on his perceived lifestyle for example (headphones, chairs, table, etc) and (yoga matt, green tea, organic veggies, etc)
The Role of Data in Customer Segmentation and Digital Marketing
Data is the power of the house of marketing strategies formulation and in implementing those strategies in the right direction, if it is wrongly collected, analyzed, or implemented then the result of any marketing strategies can have a huge negative impact on the overall ROI of the marketing plan and budget.
Customer segmentation is all about collecting information about consumers and then defining those data into particular categories or groups further when it comes to digital marketing data play a crucial role in the targeting process as online marketing is dependent on the information, if there is unorganized or missing data then there is no point of digital marketing as its help to analyze the each and very accept whether its defining keywords, calculating ROI, and many more activities.
The power of data is that it can be used at any point in time no matter if it is old or new data but the main thing is that a business or marketing agency is capable of taking insights from the given information or not. Let us understand with an example how data is important to gain growth of digital marketing agency:
A business is selling a service-based product, the business runs add-on Google ads after running ads on Google, and then one lakh people visit the business page out of which fifty thousand people purchased your service, and the twenty-five thousand added to the cart and the remaining twenty-five thousand does not respond and bounced from the website. The below table refer to understand better
Now from the above data, a business can calculate another aspect also like click-through rate(CTR)
so from the mentioned data above we can conclude that a service or product should be re-targeted to the customers through promotional messages that are abundant in the cart, and some need upgradation in the product or service as their CTR is very low, and some products are having higher CTR so in this scenario collect all data and campaign method as it ROI is high and it can be used further by analyzing all points in this product success.
How to Overcome Challenges in Digital Marketing with Customer Segmentation
Challenges are an integral part of digital marketing while considering customer segmentation as the market is drastically changing through the advancement of new technology it is now easy to target customers but with that, difficulties are also revolving around the corner as new preferences are generated in each sector or industry and meeting the expectations of each group of customer which has a marginal difference of preference it is very challenging to meet that expectation while considering the market commotion higher rate with the advancement of technology. To overcome the challenges in digital marketing with customer segmentation various checklists need to be monitored while forming groups:
- Try to form isolated groups which should be no bigger in numbers.
- Whichever group is going to be formed clear the contention and goal.
- Groups need to define their target audience.
- Clarity should be also regarding the position of the product in the minds of the segmented group.
- Precise with numbers so that it can be measurable as if evaluation is not possible there can be proper results.
Top Tools for Customer Segmentation in Digital Marketing
In today’s time when the availability of the internet in every corner of the world has increased, there are various technologies and many advanced tools that have been developed and which are playing a crucial role in digital marketing, Presently we are living in a time of AI which is a self-sufficient tool that can do many tasks easily and play an essential role in digital marketing.
Tools have become an essential part of digital marketing with the introduction of tools and technologies there is a shift in the name of marketing methods that is traditional marketing to digital marketing which is possible through the fit of tools of advertising methods.
Let us consider some of the famous tools for digital marketing:
Google Trends: It is a tool that helps in finding trending topics, along with that it can evaluate the trends of any particular topic that has been asked from the user with different time ranges.