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5 Types of Customer Segmentation for Customer Success

 5 Types of Customer Segmentation for Customer Success

It might sound counterintuitive, but one of the smartest ways to build customer success is through segmentation. Proper customer segmentation still takes advantage of the personalized outreach of success management. It also simplifies the entire process by saving you valuable time.

Knowing how to segment your audience can maximize the benefits of successful practices. Here are x types of customer segmentation you can do to make the most out of your customer success.

What Is Customer Success and Segmentation?

To find out the types of segmentation that can help with your success management strategy, it’s essential to define terms first. If you don’t do either practice yet, you can use this as a good guideline.

Customer success is the process of helping customers receive their desired outcome with your products and services. The process helps smoothen the entire process, from sales to after-sales, when others continue to use your product. You help your customers achieve their goals and provide them with one of a kind customer experience.

Customer success aims to align client and vendor goals for mutual benefit. Customer success strategies typically result in decreased churn and more opportunities to upsell.

On the other hand, customer segmentation is the process of breaking down your client base into smaller groups with similar characteristics or behavior. Doing this allows you to tailor specific messaging to each unique group. This helps you gain more traction, increase ROI, and optimize customer retention.

When done right, it helps you create relevant, customized experiences for different types of users. When you break down your customer base, you can better focus on prioritization and focus on the most interested group of your target. It also helps tremendously in defining the ideal customer journey.

Customer Segmentation Via Success Metrics

Your customer’s success is integrally tied to their usage of your products or services. One of the easiest ways to perform segmentation is through the use of success metrics. These analytics and categories should help you develop sales and customer success without much trouble.

1. Churn Score

A customer success team’s primary responsibility is to prevent churn. Score and segment your customers based on their churn potential to maximize customer success.

If a company hadn’t logged into your app in a week, that’s a potential indication of potential trouble with your app from their side. This will enable the customer success agent assigned to that company to speak with the company and learn how they can assist.

If they have not signed into the app for three days, the company may be placed in a “moderate churn likelihood” category. A simple check-in email may be all that is needed here (which is also a time-saving tactic).

You never have to decide where your customer success agents should spend their time with these segments. The segments are already telling you that.

You can gain a more comprehensive understanding of companies’ behavior with advanced customer success software. As a result, your churn scores will be more accurate.

A simple way to do this would be to track the frequency of logins, as shown in the examples above. Other factors also play a role. These metrics can be influenced by purchase history, engagement level, browsing behavior, etc.

2. Recurring Revenue

Another great way to divide your clients is through recurring revenue. If you are operating a subscription-based SaaS, your company will account for monthly, quarterly, annual, or even biannual payments.

As a result of paying more, the customer expects a better customer experience since the product is an essential asset for the customer. The customer may require more assistance. Customers who pay more want to obtain the maximum benefit from the product.

You would want to see what these customers expect from the product. Finding out their pain points and resolving those issues can help you add value to your offering. This also reduces the potential churn for customers with strong recurring revenue within your company.

3. Engagement Level

Engagement level indicates how active a client is in using your service. You can use customer engagement as a metric to determine if an account requires more or less attention.

Engaged users are those customers who frequently use your application. They interact with your brand regularly, investing in your content, services, and offers. Some unengaged clients do not respond to your outreach on the other side of the spectrum.

Unhappy customers with inactive accounts are a drain on resources. They may demand more attention than they deserve. You must retain them, provide value, and keep them updated about new features, updates, and even discounts.

Leverage social listening as a way to connect with customers who are looking to engage with the brand. Giving potential customers an easy gateway to your services can pay dividends down the line.

4. Customer Age

Another way to determine which type of engagements each customer needs is to categorize them as new, old, or both. New customers have just signed up and are most likely unfamiliar with the platform.

For new customers, you must make them feel at home. You should educate them on how things work, what your product is, and how to best use it. Providing a video tutorial for these customers can make things easier. However, they may need support along the way. This can come in live chat, phone, or email.

On the other hand, some older clients are familiar with your product or services. These are your main sources of income. You need to keep them happy, engaged, and happy.

Older customers have different needs. Depending on how long they’ve been using it, they will have different expectations about the product and service.

5. Customer Behavior

Your predictive marketing and behavioral analysis tools can be used to maximize the effectiveness of your efforts.

Identify the typical patterns of their behavior. What devices do they typically use? Which browsers? Do they buy products online? By knowing these things, you can start designing an ideal experience for each of your unique groups of consumers.

Define the different goals of each customer. Are they trying to achieve higher revenues, improve efficiency, reduce facilities, increase sales, increase revenue, reduce costs, etc.? Different buyers will have other goals. Knowing their goals will help you devise the best plan.

The Bottom Line

Customer segmentation is not among the first strategies many consider for customer success. Regardless, it is a powerful way to connect with your customers, find your help, and boost those you think need it.

Segmenting your prospects, leads, and customers can help you and your team provide a better experience. Understanding your client lifecycle can also help you determine which actions you need to take.

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