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The success of your business’s digital marketing campaign heavily relies on how you reach out to your customers. That is when customer segmentation comes in. You have to consider their interests, lifestyle, and buying behaviour to captivate and convince them to make a purchase. Your target audience should never be regarded as a monolithic group. In this article, you will learn about customer segmentation models:  1) Demographic Segmentation, 2) Geographic Segmentation, 3)Psychographic Segmentation, 4)Technographic Segmentation, and 4) Behavioural You will also understand the customer segmentation strategies: 1) Identify Goals, 2) Segment Customers, 3) Reach Customer Segments, 4) Re-Evaluate Customer Segments. 

Every business has different groups of customers with different demographics, interests, buying behaviour etc. 

 

To captivate them, you need to approach them differently. You should not treat your customers as a monolithic group. According to research from Epsilon, 80% of customers would consider purchasing more when a brand offers a personalised experience.

 

Think of it this way: How you spend time with the people around you differently depending on the similar interests, lifestyle, habits and activities that you all enjoy doing together.. That is the same as how you should treat your customers, and the best way to do that is through customer segmentation.  

 

But how does customer segmentation work? Let us learn more about customer segmentation for better digital marketing here.


What Is Customer Segmentation?

Customer segmentation is a modern approach to marketing that focuses on the audience rather than the product. The goal is to deliver relevant messages to specific audiences. To do so, you need to segment your market and make a digital marketing campaign tailored to your target audience’s preferences.

 

You can break down your target audience into smaller groups, which allows you to develop specific digital marketing strategies based on different expectations and preferences. 


Customer Segmentation Models

1. Demographic Segmentation

Demographic segmentation is all about knowing “who” your target audience is by identifying specific traits, such as age, gender, profession, education, and ethnicity. 

 

You will segment your target audience into different groups based on the mentioned traits so that you can personalise your digital marketing strategies targeted for specific groups of customers you have segmented.

 

Here is an example of demographic segmentation from Nike:

 

2. Geographic Segmentation

Compared to the other types of market segmentation, geographic segmentation is the easiest. All you have to do is identify and group consumers based on location. You can define your target market’s segments by knowing their country, region, and city.

 

Here is an example of geographic segmentation from OETEO, a children clothing store in Singapore. In this digital marketing campaign of OETEO, they are offering free local shipping for orders above $S20!

 

Geographic Segmentation

 

3. Psychographic Segmentation

For psychographic segmentation, the goal is to understand “why” your customers might be interested in your products or services, depending on their personality, hobbies, values, and beliefs. 

 

This step of the customer segmentation  model is probably the most challenging since you will need to identify each consumer with in-depth research. It requires you to analyse different personalities and see how they affect your marketing. 

To make things easier, here is an example of psychographic segmentation. It is a digital marketing campaign from Omni Hotels & Resorts, and their goal is to target comparison shoppers and convince them on how they can get the most out of their purchase decision.

 

Psychographic Segmentation

 

However, the rewards are worth achieving. Once you have understood your customers on a deeper and more personal level, which means you can deliver the right message and create content tailored for them.

 

4. Technographic Segmentation

This customer segmentation model identifies a group of customers based on the following,

 

  • The type of device a customer uses when visiting a website (e.g., desktop, mobile or tablet)
  • Which browser does a customer uses when browsing online (e.g., chrome, safari, opera)

 

By knowing which one a customer is using, you can curate a better digital marketing campaign that suits their interest. For example, if you own a smartphone accessory store and one of your potential customers visited your website using an iPhone, you can use retargeting marketing ads to appeal to them with iPhone accessories. 

 

5. Behavioural Segmentation

Behavioural segmentation tackles “how” your customers interact with your business. Vital factors to consider for this type of market segmentation include browsing habits, purchasing decisions, brand loyalty, and product reviews.

 

For instance, by distinguishing first-time website visitors from those who have already visited your website before, you can personalise the customer’s experience more effectively.

 

Two types of landing pages

 

Notice the difference between the two messages. One is for first-time visitors who might want to know more about your business, while the other is for loyal customers who are more likely to buy again. Gather behavioural data to personalise each visitor’s experience and increase their chances of making a purchase.

 

In summary, customer segmentation models are:

 

 customer segmentation models

 

4 Customer Segmentation Strategies

1. Identify Goals

When it comes to customer segmentation, you should know that it is not a one-size-fits-all concept. That means customer segmentation is unique to each business. So, ask yourself, what are your main business goals? 

 

You can only develop your strategy by answering these questions to identify your goal and determine your desired result in customer segmentation. As such, you can create a better digital marketing campaign for your customers. 

 

2. Segment Customers

Once done and you have created your customised segmentation plans that match your business’s objectives, you can divide your potential customers into multiple categories. There are no predetermined rules for determining whether you are correct or incorrect. You have complete control over how your consumers are segmented as long as you segment them according to your strategy.

 

You can segment your consumers based on their shared interests. For example, if you want to target your digital marketing campaigns towards young millennials, target trending topics on Instagram and TikTok—social media platforms where the younger generation is more active.

 

3. Reach Customer Segments

After you have segmented your customers, decide how you will approach them with your digital marketing campaign. Guarantee that all of your employees know and understand so your message will reach your targeted customer effectively. 

 

4. Re-Evaluate Customer Segments

To make sure your customer segmentation of the digital marketing campaign works, you should evaluate it by running an analysis. Doing so will give you an idea of how to improve your approach even more and nudge them to take action. 

 

The following are the tools you can use to run a customer segmentation analysis:

 


Conclusion

Customer segmentation is a revolutionary approach to digital marketing that every business should start implementing. Since your target audience is the priority, you can promote your products or services in a way that will resonate with potential customers most effectively. By targeting customers with high profitability, the likelihood of boosting conversions and sales will increase over time.

 

Get in touch with an award winning digital agency in Singapore like OOm to know more about digital marketing. Contact OOm at 6391-0930 or leave a message on our website.

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