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Why Smart Companies Segment Customers and Increase Sales

How does the old song go? “You say potato, I say po-tah-to.” The point being, no two of us are quite alike. Not everyone has the same needs and wants.

“If you talk to them all the same, you undermine the power of your message,” said sales training expert Adrian Miller. A better plan? “Segment, and then design outreach strategies and communications that are most effective and resonate best with each segment.”

Small businesses can leverage everything they know about their customers by breaking them down by type and sending out tailored messages to each group. Segmentation can be a powerful tool, when driven by the right technology.

What constitutes a segment? Some common groupings include:

  • Geography. Customers in a particular location may be prime invitees for special events. Locals may be more apt to respond to a personal touch, a one-on-one connection that wouldn’t work with those further afield.
  • Content. In the most obvious sense, shoppers who buy only records likely won’t respond to a marketing message about books. What they buy can be a big signal as to what is worth your time to try and sell them.
  • State of the relationship. A customer visiting your site first time will require a different sort of follow-up as compared to a regular visitor, or one who drops by just once and don’t come back. By breaking them out, it’s possible to give each a more tailored message.
  • Spending. Common sense says that small businesses with limited marketing resources ought to target their messages first at those who spend the most.
  • Opt-in status: Those who have chosen to hear from you may be more receptive to what you have to say, and can be addressed with different content and a different tone as compared to those receive an unsolicited follow-up offering, for example.

How to break them out? Here’s where your Customer Relationship Management (CRM) system earns it stripes, not just by gathering behavioral data but by allowing you to break it all down into meaningful segments.

CRM refers both to a software type as well as to the business strategy driven by that software. It is designed to aggregate all customers into a single view, giving the business access to diverse demographic data that can easily be re-purposed for various business needs. A few popular products include Salesforce.comInfusionSoft,SalesNexus , BatchBook and CapsuleCRM.

Segmenting customers to market to them as individuals is important. I wrote about this for Dun and Bradstreet Credit Corporation. Read the full article here.

 

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About Ramon Ray

Ramon Ray, Marketing & Technology Evangelist, Smallbiztechnology.com & Infusionsoft. Full bio at http://www.ramonray.com . Check him out on Google Plus, Twitter or Facebook

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