Meet Your Best Customers for Long-Term Profitability

In today’s article:

  • How your VIP segments break down across demographic personas, and what this means for your marketing strategy
  • What product affinity and purchase patterns can tell you about what attracts your biggest spenders.
  • What kinds of qualitative insights can round out your VIP-intelligence and the seismic ripples across the business such a new understanding can create.

In the previous article in this series, we hammered home the point that the top-spenders in your customer file likely bring in 50% or more of your annual revenue. To show you how stark the difference between levels of customer spending can be, below is an anonymized graph representing a real-life distribution.

In this case, Platinum is the Custora designation for your top 1% based on predicted future spend.

You may have a platinum customer segment where each member's future predicted spend is over $1,100 where spend in the bottom 50% is as low as $26 or $6. As a result of that, you see this top 20% making nearly all of your future revenue.


AI-powered segmentation is a powerful tool that can produce a set of distinct behavioral personas. In this case, we see — based on some observable behaviors — a pretty distinct set of differences between a few different personas.

This is overly simplified. We would normally have more than three personas. But right away we can see how much of each persona segment is composed of the VIPs and also see what their product preferences are, what discounts they need, so on and so forth.

If you look at your whole customer base in terms of its personas, that'll illuminate where some of your VIPs are sitting in terms of some of their other demographic and behavioral patterns.


Your products represent another avenue to learning more about what drives VIP behavior. Can we understand which products are of highest value to our VIP customers? 

Here's another realistic example. Let's imagine for simplicity’s sake that you're a sock company and your entire product assortment is different types of socks.

For each product category — in this case just different types of socks — we would look at the concentration of VIP versus non-VIP as a percentage of purchases in that segment.

It wouldn't be uncommon for us to see something like this, where this leftmost sock is not only the most popular for VIP, but there's also the difference between the VIP and the non-VIP concentration as illustrated by the difference in height between the blue and green bars, which in this example are the VIP customers versus the non-VIP customers.

The conclusion here is that this leftmost sock category is one that uniquely appeals to a VIP customer. That has all kinds of implications for how you might market that category and how you might use that category to convert others into VIPs.


Once you have your VIP set, you can start to gather qualitative insights. Knowing who your VIPs are is the bulk of the battle. But to round out your profile, you can start talking to that top 5% of customers to learn more about their behavior.

One interesting use case that exemplifies the power of getting qualitative insights from your VIPs comes from the extended-size fashion brand Eloquii. They had their eyes on their best customers and noticed that they were getting a lot of white dresses returned.

If they hadn’t known that these returns were from VIP customers, they may have drawn spurious conclusions about the style and fit of these dresses. Instead, they got on the phone and learned that these women were buying five white dresses at time and returning four because they were looking for wedding dresses. Eloquii realized there was a white space in the market (no pun intended) for extended-size bridal wear. In response, they opened a new arm of their business.

On a more basic level, there are questions you can ask your VIPs before you notice problems like excessive returns.

  • Why do you love us?
  • What is it about the customer experience that keeps you coming back?
  • What kind of program might you respond well to in the future?
  • What kind of feedback might you have on our assortment or selection of products?

And that’s just the beginning of what you can learn. These insights will undoubtedly steer your marketing in a specific direction. But more than that, they’ll be of critical interest to the C-Suite and VPs across your organization.

In our next post, we’ll get into strategies for collaborating with the Merchandising and Finance teams to make your VIP set a driving force in decision making across the business.


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