The Ultimate Guide to Ecommerce Customer Segmentation

4. Is it worth the investment?

When computing giant Lenovo realized that 40% of its overall online audience consisted of new, unknown visitors, the company partnered with analytics firm Neustar to segment its potential customers into different categories. In a case study, Neustar explains, “The Lenovo team’s Neustar platform cross-references this data to categorize visitors into a number of key audience groups based on product propensity and company priorities — and then shows them a specific homepage banner targeted towards their group’s preferences.” And, as a result, order conversions grew 40% and Lenovo’s average revenue per visitor increased 25%.

Store owners that customize their marketing messages for each distinct audience segment unlock hidden opportunities to engage shoppers and grow their sales. Among store owners, one of the most popular ways to use customer segmentation is through email marketing, which is also the easiest way to apply customer segmentation and measure the results of your efforts. Data from Campaign Monitor claims, “Emails with personalized subject lines are 26% more likely to be opened and marketers have found a 760% increase in email revenue from segmented campaigns.” As of June 2nd, 2016, research from MailChimp corroborates these claims. The email marketing platform found that segmented campaigns had 14.45% higher opens than non-segmented campaigns, 63.71% more clicks and 8.68% fewer unsubscribes.

With clear commercial upside to simple segmentation, it is a wonder why more store owners are not doing it. And in case you are not yet sold on the advantages of customer segmentation, here is another: the insights gleaned from segmented customer data can help direct overall business, product and marketing strategy.