Yes, Even Your Parents are in a Customer Segment
Are you ready for a flashback? You are on the phone with your mom or dad, providing technical support to get them up and running on a new technology. It could be Skype so they can video chat with the grandkids, it could be that new iPad you got Dad for his birthday (big mistake), or it could be Facebook or some other form of social media. I have undertaken such efforts for my parents hundreds of times, and it recently got me thinking about the different segments of customers that businesses get to wrestle with every day.
When it comes to interacting with a business, customers choose the channels with which they are most comfortable – and which provide them with the best customer experience. My mom and dad order products online thanks to all that training I provided on “the Internet,” but when it comes to engaging customer service they use the phone or write a letter (yes, my Dad who is 80 still hand writes the CEO). While I get completely frustrated when I can’t reach a company via a digital channel, my parents go inside their bank and interact with a teller. I haven’t seen the inside of a bank in at least five years. We are different... and so are your customers.
Knowing the different types of customers you have is an important part of creating a successful customer experience program. Did you think customer segmentation was only for marketing departments as they build campaigns to attract new customers? As it turns out, understanding the different types of customers already served by an organization is important for many reasons.
Customers engage with us through their preferred medium. It could be on the phone, via answering a survey, tweeting questions, or engaging in online chat sessions. As such, if you are serious about looking at customer experience from the customer’s viewpoint, the more you know about them the better. By understanding the motivations and needs of each customer group, effective customer programs and customer retention strategies can be developed – resulting in a personalized experience for each segment.
Customer segmentation begins with scrutinizing CRM data and defining clusters of customers who have similar behaviors. Groups can be defined in a number of ways, including geographic (country, state, type of neighborhood), behavioral (product purchased, frequency of purchase), demographic (age, gender, income, occupation), or psychographic (lifestyle, lifecycle, activities, interests).
Once the groups have been defined by the data, you can confirm effective segmentation by performing surveys, monitoring social media, mining call center interactions using speech analytics, and evaluating mounds of unstructured data using text analysis. You will accomplish two things by taking a small random sample of each customer group and asking them about preferences and behavior. First, you will confirm that the characteristics are different among the groups you have defined (which confirms that you have defined the groups correctly). Second, you will start learning about the behavior of how each group interacts with your organization. Looking at CRM data will tell you what they do – evaluating customer interactions will tell you who they are.
By performing customer segmentation, you can begin to learn about the motivations and needs of each customer group... and, more importantly, you get to know your customers.