Marketing segmentation or customer groups is a view of different customer sub-groups in your entire customer list or data base. Customer sub-groups or smart segments can be organized based on specific critera.
Segmentation criteria can vary and is driven by a marketer’s goals or programs. In this guide, we will cover the benefits of marketing segmentation, types of segmentation criteria and how to use marketing segmentation in your customer engagement programs.
This guide focuses on B2C marketing segmentation, specific for businesses and brands in the restaurant, coffee shop, taproom, craft brewery and retail industries.
What is marketing segmentation? It is the process in which a large data base or list of customers are divided into groups based on common criteria and characteristics. Marketing segmentation helps your business efficiently personalize, target and re-target audience and customers who have engaged and shown interest in your brand or business.
Marketing segmentation empowers marketers with information on how to best position your brand, product, an offer, an event based on interest, last visit, special occasions and more! This is how it works.
Before diving into a marketing segmentation exercise, brands and businesses must first identify the different customer data sources and touch points. In today’s modern world, data and information no longer comes from one place.
The classic brick-and-mortar model is 100% reliant on the POS system for information. With the growing popularity of delivery channels, online ordering and the opportunity to sell product and product subscriptions on line, restaurants, coffee shops, taprooms, craft breweries and retailers can no longer fully rely on one data source to gain a complete picture of their customer.
Data sources to consider before diving into marketing segmentation
Bringing all these data sources to converge in one customer engagement platform gives your marketing and customer teams a complete picture of your customer groups and profiles.
Marketing segmentation is about finding your brand’s biggest fans. At Bain & Company 81% of executives noted the importance of segmentation as a tool for growing profits. Bain also found that companies experience 10% higher profit margins compared to companies who did not use marketing segmentation as part of their strategy.
Other benefits of marketing segmentation include:
There are different ways marketers and customer teams can segment customer data. For the purposes of this post, let’s focus on segmentations specific to B2C (Business To Consumer).
|Demographic (B2C)||Psychographic (B2C)||Behavioral (B2C)|
|Individual attributes||Aspirations, values and criteria||Behaviors, products purchased, time of day|
|Geography, gender, income||Lifestyle, personality traits||Usage, frequency, purchase decision|
|You are a local business||You want to target customers based on values and lifestyle||You want to target customers based on values and purchase behaviors|
Your data sources are in one place, now we’re ready to define your customer engagement goals and how that rolls up to your brand’s marketing strategy.
Steps to getting started with marketing segmentation
Marketing segmentation can be applied across your customer engagement funnel and loyalty programs. Here are a few popular applications:
Don’t take our word for it. We encourage you to dive in and dig deeper. Have you read The Customer Engagement Playbook? Produced by the GoGoGuest team, it offers actionable next steps and best practices on how to implement these actionable restaurant marketing tips from creating awareness, customer engagement to growing customer loyalty that drive value.
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