Customer Segmentation

What is customer segmentation?

Customer segmentation is the process of segmenting a customer group into smaller groups in order to obtain a clear understanding of their unique needs and expectations. Customer segmentation is a method of analyzing the customer group in terms of differences and similarities within a customer group. These factors help you in offering tailor-made products or services to them and improve the retention rate of your existing customers as well. 

Why is customer segmentation important?

By customer segmentation, you can understand your customer base better and accordingly customize products or services for their needs. Data on customer preferences helps you in setting up new offerings and find opportunities for selling products to different customer groups. Customer segmentation plays a significant role in increasing the number of customers and revenue. 

How to segment customers?

Customer segmentation is not just a process of dividing customers. It’s about using a variety of relevant inputs to define customers’ needs. It helps you understand customers’ buying and purchasing behavior. The information you gather through customer segmentation helps you provide services and products to your customers.

Using online tools, an organization can gather relevant information about its customers, including demographics, purchasing habits, demographics, and even reviews. Targeted marketing with specific information will allow you to stay on track with your targeted audience. Organizations like Google, Apple, and Facebook have done this for years by using several data focused tools.


If done correctly, segmentation allows an organization to make custom marketing strategies to improve the marketing efforts to serve the needs of its customers.


Customer segmentation can greatly enhance the bottom line. Businesses have no choice but to create customer segmentation to ensure they keep customers happy and loyal.

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