Grow Your Sales with $0

Overview:

The reason segmentation is so important is that it allows you to tailor messages based on the needs of your customers. With a spray and pray mentality, you may be hitting your customers with the wrong message and possibly even aggravating them. 

For example, let's say we have two customers: 

Customer #1 just made her first purchase two days ago; she hasn’t even received her shipment yet!

Customer #2 has been buying from you for 7 years and receives shipments automatically through a subscription. 

Do you really want to send out the same email campaign for 30% off all products to both of these customers? Though both are technically customers, the first would likely be aggravated that she just missed the discount, while your diehard customer would be upset that he could have gotten a better deal. Not good. 

As you can see, segmenting your customers is hugely important, though admittedly time consuming. So I have created a unique resource to help - a google sheet you can access with all of the basic tags I recommend and implement.

Access Here

Now that you have all of the most popular tags I recommend and use, let’s jump into the three explicit areas to consider when segmenting your customers, and the value of each to your sales. 

Value-Based Segmentation:

First is value-based segmentation. Put simply, these are segments based on the value your customers. This can be as simple as customer lifetime value, average order value or no purchase value. All of these segments allow you to make better decisions when it comes to including, or more importantly, excluding, certain customers. 

Using our previous example offering a 30% off email, you would want to include zero purchase customers, but exclude high order value customers, enticing the zero purchase segment with a discount, while recent customers (who have bought full-price items) are not made to feel they missed out. 

Behavior-Based Segments: 

Behavior segmentation can be applied using things such as where the customer comes from like google, social media, email, etc. Behavior segmentation can also consider purchasing frequency and type. How often do they purchase? How long between purchases? Do they only purchase on discount? 

Again, using our 30% off example, you would likely want to include customers who haven’t purchased in 90 days (lapsed purchasers), but not customers who have recently purchased on discount. 

Geo-Based Segments:

Lastly, there is segmentation based on geography. This can include Country, State, Zip, or even time zones. These segments can be very powerful for analytical purposes or even for promotions. 

Again, using our example, I typically run promotions that include a sense of urgency... Where customers may only receive 30% off for 1-2 hours, after which the discount drops in value. This would be impossible to perform in the United States without knowing the customers’ specific time zone. 

Conclusion

This covers a very basic overview of segmentation and how you can use the concepts to add value to your store for free. The key factor: try and send the right message to the right audience as often as possible. 

I hope you found value in this discussion and the tag-resource link... and I hope you can start using tagging and customer segmentation to grow your online store. It is the number one way to increase sales without spending money!

See you in a week.