Lead segmentation is the process of grouping leads based on various parameters and insights to determine how your prospects and customers can be categorized. Demographic details, behavioral details, geographic details, and psychological details are a few of the many parameters under which your leads can be segmented.
Segmenting your leads based on such parameters helps personalize your customer experience and offers tailored solutions to different customer types. You can also create personalized offerings for diverse lead segments based on income, regions, or other criteria. Such segmented leads can result in better response rates and lower customer acquisition costs. Moreover, practicing lead segmentation helps improve your product targeting in your marketing campaigns and sales strategies. Here is a list of different types of lead segmentation that you can implement to boost your marketing strategy:
Demographic Segmentation
Demographic segmentation is one of the most common types of lead segmentation to identify potential audience patterns easily. By categorizing the audience according to various demographic parameters such as age, family size, gender, education, occupation, and income, you can efficiently strategize marketing campaigns based on different interests. This helps define the products or services different categories of audiences want to purchase and how much they can afford to spend for such offers.
Geographic Segmentation
Your audience’s expectations will vary based on their geographic location, and thus you need to segment them according to their continent, country, region, city, or district. Customers have unique needs, interests, and expectations that can vary from one region to another. It is crucial to understand the differences in regions, climates, demographics, and behavior to know what that segment of the audience belongs to, how to promote and sell your products, and where to expand your business.
Behavioral Segmentation
By segmenting your audiences according to their behaviors and patterns of purchase decisions such as their past purchases, lifestyle, product consumption, and usage, you can take a more targeted marketing approach. Also, you can divide your customers by their previous purchase behaviors related to your products and services. Segmenting customers based on their behavior helps determine their product awareness, product knowledge, past purchases, purchase patterns, usage level, and product and service ratings.
Psychographic Segmentation
Segregating people based on their psychological aspects of behavior helps determine certain traits such as attitudes, interests, values, and lifestyle choices. This psychographic segmentation method is beneficial for products or services that impact people based on specific views, beliefs, or ideas. As personality traits, lifestyles, opinions, values, and special interests vary, you may also need to strategize different marketing campaigns to address each psychographic behavior.
Firmographic Segmentation
If you are a B2B company, you may want to categorize your customers based on company size, industry, and functions. This is known as firmographic segmentation and is used when marketing a particular product or service that directly impacts the company.
Transactional Segmentation
Transactional segmentation groups people based on their purchase frequency, last purchase made, how much they spend, and purchase content. This helps brands identify their most valuable customers and frame rewards for them.
Needs-based Segmentation
Needs-based lead segmentation is the process of grouping people based on the different types of benefits people want. There are different types of needs, such as functional needs, emotional needs, and problem-solving needs.
Lead segmentation has helped produce remarkable results by some of the largest brands. Canon’s customers used their photography equipment for professional use. Interestingly, they targeted children! After which, they realized that there was a big chance to move ahead in the low-end digital camera market. The reason was very simple. Since adult amateur photographers rely on their smartphone cameras to take pictures, and parents don’t want to buy smartphones for their young children, they will be inclined towards buying low-end digital cameras for their kids. They launched a marketing campaign that gathered children’s interest in photography and caught a 40 percent market in the low-end digital camera market within a year of its launch. Canon would have struggled to recognize this unconventional opportunity and grab the market share without research and segmentation.
Your database needs to be segmented and managed properly if you want your business to be successful. You need to accurately label your customer and business history to maintain long-term success and avoid data integrity/targeting issues.
