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Market segmentation: 5 things to consider

Customer segmentation hasn’t changed much from collecting the demographics of prospective buyers in order to know them better. Such tools that are used to find the sex, age, location of a person are still in business today, but they are slightly moving towards understanding the customer on a personal level. A tool like Machine Learning and digitalization will set the bar in the coming years for data mining – these things will continue to be available for use in the foreseeable future. However, misconceptions might exist about the way to use them.

Before you go down the segmentation road, here are 5 things you need to know.

How customers react is just as important as their names on a sheet of paper.

Customer segmentation goes beyond just hitting any data defined on a sheet of paper. It is about monitoring the customer’s action daily on your website or landing pages. What they do, how they do it, and how the trend goes at the end of the day, week, months, etc. Some companies go to the extent of finding out why do people drop their carts and leave the site or why there is a high bounce rate on their e-commerce website? They even go ahead to contact these customers to know the reason behind their actions.

If you look further into customer’s carvings and few actions customers take at any given time, example; you can go ahead to look into who never entered a debit or credit card. Who had an issue entering a debit or credit card, who never for once provided any detail, those who never went forward after adding a product to the cart, etc. Your message for each customer regarding their actions are always going be different. By studying each activity, you can quickly draw out a specific action plan that is suitable for each customer. You can even go forward to design landing pages using an expert or yourself.

Automation and machine learning represent the vital points of segmentation.

 The primary reason why people are currently suffering from segmentation is that breaking down the whole amount of data can be extremely hard. It can seem like a long day spent when you start to segment and to ensure they are correct. Correct is the keyword here. You don’t want to be caught in the middle of an embarrassment because you sent out the wrong data or missed out an important detail.

Automation and Machine learning is the guiding principles firing segmentation into the new and modern era. With the proper tools and machinery that can monitor interactions and engagements of the customer with the company, the customer’s journey can be analyzed. That way, every individual in the program can be optimized to a personal level. These tools are now the yardstick in measuring serious branding online because of its added advantage.

Smaller segmentation breeds confidence.

Every customer appreciates a brand that recognizes them and their pain points, and are always looking for innovative ways of addressing their problems. That is why the pain points need to get highlighted in any content because it is very relevant.

Micro-segmentation is filtering your client accordingly into various sections. In a simple scenario, a client that has this data; A 69-year-old male living in Chicago. If this goes into micro-segmentation, it becomes 69+ men living in Chicago.

Infosys Survey estimates that 78% of people interviewed would instead buy from a targeted market than any place. But they have to trust you at first. When they do that, their purchase in your company can rise to above or within 67% from the first time they made their purchase.

Product development should work its market segment.

 When you start appreciating your customers, like knowing what problems they are facing, are their desires being met, what do they have on their scale of preferences? You can tailor-make your product to meet their specific needs.

Segmentation and marketing work hand in hand to form the product – it is when a problem appears and the solution gets found that segmentation makes it easier to target the market. More prominent companies have no time for this type of data, but a smaller one would because it would be beneficial in the long run for their product development.

If data is as necessary as they say it is, companies should take a more refined approach in getting them before designing their product instead of waiting on assumptions.

Customers’ needs are dynamic.

Having customers, all figured out in the data that ran years ago can be detrimental to your business.

People change after some time, so does their taste and preferences. A year ago, I might not need the same things I need today. Updating your data information is the best solution if customers taste continues to change.

Personalized content is here to stay.

Knowing your customer is the best way to go if you are going to personalize. That sets the tone for how you are going to channel sales and marketing efforts. Segmentation has changed from what it is. However, it is the tools for micro-segmentation that has changed. 

Segmentation can make or mar your business as more companies get the sense of its potential in the market.