Segmentation — Chapter 8

Previously on "Lost"

Winning Back “Lost” Customers

Once you've figured out a customer is lost, you're going to want to try to win them back. Given the amount of information you probably have on them, it's almost always worthwhile reaching out to them and bringing them back into the fold.


Demographic Segmentation

Again, demographic segmentation is easy to perform and gets some results, but in this case as before, treats everyone in the same demographic as the same. In the same way that two “equal” customers might have different purchasing preferences, those two customers might have completely different reasons for no longer buying from you. By treating them the same, you aren't really maximizing your chances of winning them back.


First Product Purchased

First product purchased is a powerful attribute to segment on for most of a customer's lifecycle. However, the longer a customer has been “lost”, the more likely it is that their purchasing behaviors have changed (which may be why they became “lost” in the first place). By focusing on their early behaviors, we may just be reinforcing that our store is no longer relevant for that customer. If you suspect that's the case, then perhaps last product purchased may be a better attribute to segment on.


Persona Segmentation

Persona segmentation captures the full portfolio of products a customer is interested in and creates segments of customers based on the collections of things they buy. The results of this type of segmentation, for example, are that customers of Type A make 30% of their purchases on jeans and 70% on shoes; customers of Type B make 50% of their purchases on shirts and 50% on skirts; customers of Type C spend 30% on jeans, 30% on accessories, and 20% on shoes. This lets you tailor emails that highlight not just one, but a portfolio of products that a customer segment would be interested in, and the more you put in front of a customer that they are actually interested in, the greater the conversion rates and values of those customers.


Happy Segmenting

That wraps up Custora U's course on Segmentation. As always, if you have any feedback or suggestions on things to improve, we'd love to hear them. Or maybe you have a cool segmentation story of your own. We’d love to hear that too, and maybe we'll work it in a case study within the course.

Enjoy this tasty Segmentation Cheat Sheet with some example segmentation attributes to help you get started.

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