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This is not as obvious as it seems. There are many applications of customer segmentation which go beyond marketing, sales and products.
When we do customer segmentation, our premise and/OR our action is to do with one of the following area (OR a combination). This should not sound so complex. Typically a customer segment invokes a string of actions which run across the below mentioned list. For example a low-income group customer will invoke inexpensive products, inexpensive sales channel, inexpensive delivery mechanisms, and low-cost service options. Therefore in real life it is not a 50 (areas to act on given a segment) X 50 (customer segment) matrix on the actions you will take.
Customer Segmentation & Profiling triggers actions around the following areas:
Product
- Product Specifications- Align the specifications of the product as per the need of the customer. For example- You ability to play different video formats on your mobile for younger age customers.
- Product pricing- product price as per what customer can OR will be ready to pay. For example- Make premium pricing for products positioned for high net-worth individuals.
- Product packaging and positioning: For example, you will like to have jazzy and flashy packaging for products aimed at younger audience.
Marketing
- Advertising and sales promotion: For young generation, advertise more on the web on community and social network websites.
- Sales Material: If you are selling life insurance products, you will avoid flashy sales kit.
- Brand Management: The brand personality of your product for a given customer segment should be aligned.
Sales
- Sales channel acquisition: low cost channel for low value customer segments..
- Sales scripts and training: talk about children education and marriage for a customer who is employed and 35+ years of age..
- Leads Management: Prioritize leads from potential high-income and high value customers..
- Sales outlets and presence: High-end, well furnished outlets in high-end locations for high net-worth.
- Up-sell and cross-sell: Up-sell and cross sell products given the customer segment. You will not sell loan products to a customer who has been having a less than adequate repayment history.
Order Fulfillment
- Order delivery: For HNI customers, you may like to have the product delivered to their home.
Post Sales
- Customer Service: Internet based service for low-ticket products, and relationship face to face service for large value customers.
- Product support and maintenance: Onsite service and repair for higher value customers.
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