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Customer segmentation to maximize revenue
Project type
Customer Segmentation
Good customer segmentation drives deeper customer understanding
Many companies segment by industry, or by company size. That's fine. As long as it works. But what causes a persistent itch in my brain is that these are also the easiest segmentation approaches. So I wonder, perhaps some companies default to them simply because they don't have the time or resources to think deeply about segmentation. And maybe, that costs them revenue as a result...?
So I've explored other segmentation approaches. The one shown here was to find alternative ways to segment clean energy buyers. Good segmentation is a collaborative, organization-wide project. This 2x2 was for a workshop along the journey. The goal was to provoke a discussion about what factors would be best to use for segmentation.
But "best" has to balance ROI against "easy". Because a segmentation model needs to be a living thing. If you can't refresh it from time-to-time, it quickly becomes stale. I've heard of companies that took a very sophisticated approach to customer segmentation. Problem was, refreshing the segmentation was so hard it never happened. You need to find the right balance between a segmentation that optimizes sales and marketing ROI and one that's easy enough to refresh and update.
Unfortunately this segmentation project never got completed. But businesses that don't segment well - or at all - waste their marketing budget and lose sales.