How should you segment your customers?

Traditional segmentation focuses on static identifiers such as location, gender, and demographics that your customers have in common. This is typically used in conjunction with simple behavioral commonalities such as the number of visits, sessions, and conversions. Some segments created along these lines include:

  • Recent purchases
  • New vs. returning visitors
  • New vs. repeat purchasers
  • Repeat purchasers vs. VIP customers

 

Adopting behavioral segmentation involves identifying and grouping visitors around their search and decision-making habits. Behavioral segmentation differs from traditional segmentation as it focuses on dynamic and changeable attributes like intent, context, and circumstances.

What is contextual segmentation?

A recent trend in segmentation is contextual segmentation, which takes context to a much deeper level.  Context pulls in factors such as time of day, device, location, and interaction. We then combine these inputs into a specific scenario “Customer X, browsed for rain jackets, whilst it was raining in their location at 11 am on a Monday morning on a cellphone and went on to place an order.” We then use this very specific scenario as a target for an experience that surfaces a special offer for rain jackets, adapted for the mobile platform for visitors that browsed rain jackets in the same location.

Why is segmentation important in personalization?

Segmentation is a cornerstone of personalization and a highly effective tool for targeting groups of users with experiences that play to their different needs, wants, and cultural characteristics.

 

Through segmentation, you can focus your personalization efforts where they will yield the most value and have the most impact. This might include an experience that targets a segment of your most valuable customers or an experience that targets users that abandoned your site at a particular point in their journey.

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