Did you know that the highest revenue stream often comes from loyal customers? These are the customers that repeatedly purchase products from your business and eventually become high spenders. Because of this reason, your business should learn how to take care of your loyal customers, and customer loyalty segmentation is one way to go about it.
After reading this guide, you will grasp how to group customers based on specific criteria, allowing your business to have higher chances of thriving and excelling. We will also give you some customer segmentation examples to use today. Let’s get started!
Customer Loyalty Segmentation: What Is It?
Customer loyalty segmentation is a marketing strategy that groups your customers based on their loyalty level, such as:
- potential buyers
- new buyers
- occasional buyers
- loyal buyers
- churning buyers
Segmenting customers based on their loyalty can help businesses create targeted marketing campaigns that target specific audiences. You can create loyalty programs and personalized experiences to retain loyal buyers and win back churning buyers.
For example, loyal customers may respond well to exclusive offers. Meanwhile, churning customers may be interested in discounts based on their past purchases. This personalized approach helps increase your marketing strategy success.
Different types of customer loyalty
In the section above, we’ve learned that there are loyal buyers. However, customers also have different levels of loyalty:
- active loyalty, where customer make frequent purchases and promote your brand positively
- passive loyalty, where customers are happy with your brand but are not actively promoting it
- latent loyalty, where customers have a positive image on your brand but aren’t highly engaged with it
- at-risk loyalty, where customers are dissatisfied with your brand and at risk of purchasing from a competitor
It’s important to understand customer segmentation analysis so you can create the best strategies for your marketing campaigns.
Five customer segmentation models for customer loyalty
Here are five customer segmentation models:
- RFM. RFM model groups your customers based on recency, frequency, and monetary value.
- Behavioral. Behavioral aspect groups your customer based on interactions and behaviors with the brand.
- Attitudinal. Attitudinal aspect groups your customers based on values, beliefs, and motivations of the brand.
- Demographic. Demographic indicators groups your customers based on characteristics like age, gender, income, and family status.
- Psychographic. Psychographic indicators groups your consumers based on lifestyles, personalities, and interests.
As a business, you can use a combination of these customer segmentation examples to create strategies that can strengthen customer loyalty.
Customer Loyalty Segmentation: What Are the Benefits?
Let’s take a look at the benefits of using customer segments in your business.
Targeted marketing campaigns
Customer segmentation helps businesses understand who their audience is. From this information, you can create personalized messages and promotions that resonate with a specific audience, increasing the chance of conversion. Now, you can use tools like WhatsApp CRM to connect with them. With a WhatsApp CRM, you can provide great support and response to your customers in time.
Watch the video below to learn about how to get started with WhatsApp CRM:
Better customer retention and satisfaction
Another benefit of customer loyalty segmentation is improved customer retention and satisfaction. Businesses can focus their efforts in nurturing valuable relationships with loyal customers. Alternatively, you can also identify at-risk customers and create a strategy to strengthen their loyalty over time.
Customer segments also help increase customer satisfaction by offering personalized experiences. You can create tailored products, services, and communications that align with customer preferences. This increases loyalty and drives repeat purchases and positive reviews.
Better resource allocation
Segmenting customers based on their loyalty helps businesses allocate their resources more efficiently. You can prioritize your resources on high-value segments, such as loyal customers who provide the highest revenue and profit. This way, you can optimize assets like budgets, personnel, and time.
For example, you can allocate a most of your marketing budget to retain and engage with loyal customers, which includes running loyalty reward programs and exclusive promotions. By doing this, you encourage repeat purchase.
Higher revenue and profit
Segmenting customers allows businesses to allocate marketing resources more efficiently. This is done by targeting the greatest potential for revenue growth. For instance, if the biggest sales are made through one product, consider learning about the type of customers that make those purchases and recommend more similar products to them.
Additionally, you can identify opportunities for cross and up-selling to existing customers. You can recommend additional products or offer premium upgrades to loyal customers!
The Role of CRM In Customer Segmentation
A CRM tool is helpful for businesses looking to optimize customer segmentation. And one of the best tools for customer segmentation include a CRM with WhatsApp integration. With a WhatsApp-powered CRM, you can capture customer interactions and conversations directly within the CRM platform. This lets you have an overall view of the customer, including their communication and interaction styles.
Additionally, a WhatsApp CRM also provides real-time customer engagement, where you can share immediate responses and support. This is great for answering questions, providing support, and delivering personalized recommendations. When done right, all of this will improve customer satisfaction and loyalty.
What’s more, a CRM centralizes communication within a single platform. This makes sure all customer conversation history is accessible from a single place. Another great thing about CRM is their automated workflows. This way, you can send automated responses, schedule follow-up messages, and trigger campaigns. It is a great hack to improve efficiency and take care of your customers.
Finally, leveraging technology in customer segmentation is essential for today’s business success. Integrating a Whatsapp-based CRM can be a powerful tool to improve customer loyalty.Utilizing CRM to Build Customer Segmentation by Loyalty
