Customer Segmentation Approaches

Segmentation beats personalization. Personalization is terribly inefficient... (and oftentimes unnecessary outside of highly strategic enterprise selling). Think about the ads that really grab your attention. None of them have your name in them. Or mention podcasts you were interviewed in or posts that you wrote. These ads work because they're segmented based on patterns amongst small-ish groups of people. Outbound should be treated similarly. Pro tip: this approach works WAY better over the phone than via email. The expectation for personalization and quality is much higher in emails than over the phone. Here are a few ideas for segmenting your lists so you don't have to personalize so much: ✅ By region/location If you sell anything brick & mortar, SLED, etc—segment your accounts by geographic region. You really don't have to personalize much when you can: - Name-drop local businesses/organizations - Drop the location This sounds like: "Hi David, we work with Fit & Fashion right down the road in SLU. It's Jason with ________. Ring a bell?" ✅ By tech stack Let's say you sell a tool that enhances Salesforce. Or Jira. Or some other specific tool. Segment your accounts by tech stack. This sounds like: "Hi Katie, we're partnering with engineering teams who wish sandboxes were way easier to set up and use in Zendesk. It's Jason with ________. Got a min?" ✅ By persona Let's say you sell to ecomm solutions to SMB retail business owners. This sounds like: "Hi Tom, we're working with several retailers in the Seattle area. It's Jason with ________. Heard our name tossed around?" (H/T Armand Farrokh) ✅ By trigger This list gets pretty extensive. Hiring, job changes, customer/champion change, M&A, expansion/contraction, promotion, etc This sounds like: "Hi Dave, congrats on the promotion. It's Jason from __________. Was just talking to a new HR leader yesterday who's running into all kinds of complications scaling international hiring. That by chance something you're running into?" ✅ By niche One of my favorites. Take a well-recognized logo like Rippling. You could go after direct competitors, but it's even better to focus on non-competitive products selling to the same personas. This sounds like: "Hi Cierra, we're working with Rippling to help scale their product suite for HR leaders. It's Jason with ________. Thought you might want to hear how they've doubled ACV in the last 6 months. Have a min?" ~~~ Before you think of personalization, start with segmentation. Do the work upfront to avoid having to customize too much. Agree or disagree? We're training entire sales orgs at companies like Shopify, Rippling, Zoom, and many more on how to land more meetings with outbound. Interested in custom training for your team? DM or email me jason [at] outboundsquad.com for more info.

Do you know how to correctly set user personas for your product? What are user personas? Should both Prince Charles and Ozzy Osbourne land in the same user bucket? Well... It depends! A user persona is a made-up person representing a group of users in your product. It’s explicitly designed to help product teams understand their end users deeply by digging into their problems, goals, needs, pain points, behaviors, and preferences. The common misconception is that user personas are based on demographic data. While for some products this may be the right choice, this will usually be wrong and misguided. The user persona concept is not really about representing real people but representing a pattern of behavior. So, to correctly identify your user persona, you should not start with a name and a fake bio. Not at all! Instead, you need to dig deep into your product's analytics data and identify groups of users that interact with the Product in a similar manner. Thus, for example, for Spotify, you could identify the following groups: • Casual, free users • Paid users • Creators    Of course, you can go deeper and look for more granular personas within those main groups, but that's a story for another day. To the point, definitely, King Charles and Ozzy Osbourne would not fall into the same persona bucket. The King is most likely a Paid user, while Ozzy is a Creator. I can however imagine a Product, say about a medicine tracking app, where both Ozzy and Charles would fall under the same, "elderly, who need help to track their medicine intake" group, though they are very different people when you get to know them. And this is ok, again, user personas are about identifying patterns of behavior, not about any specific user, fictional or otherwise. Giving those patterns names and backstories has only one goal: To help you better communicate, to connect emotions and context to any problems the problem is built to fix :) Just like it helped to build this post! Just to add: knowing your demographics will help you build the right product, but it's not the same as crafting user personas. It will help you craft an imaginary user to closely match your typical user :) Do you agree with me? What are the product personas in your favorite product? Sound off in the comments! P.S. User personas are only a single tool in a Product Manager's toolbox. To learn more about other tools and how to become a Great product manager, visit www . drbartpm . com.

I'm restructuring our entire CS book this year in a way I’ve never done. Not by customer size. By product potential. For years, I segmented like everyone else: enterprise customers get white-glove service, mid-market gets a CSM with a bigger book, small customers get tech-touch. But I’m realizing that a customer’s size doesn't actually tell you what they need from you. What matters more: -Where are they in their product adoption journey? -What's their expansion potential with our platform? -What kind of relationship and support do they need from us? So I'm splitting my book differently this year. Size is still a factor, but potential is more important: Bucket 1: Enterprise relationship accounts.  These are massive customers. They move slowly. I don't expect them to buy a ton of new stuff, but if they leave, we're in trouble. So I'm assigning them to my most relationship-driven CSM—someone who can have strategic conversations about where things are headed 5 years from now. Bucket 2: High-potential ICP accounts ($20-50K).  These are our sweet spot customers. They're the most likely to love us if they actually use everything we've built…and most likely to leave if they don't know the value we provide. I'm putting my two most curious CSMs on this segment. Their job isn't to manage accounts. It's to ask questions, learn, educate, activate, and grow these customers. If a customer in this segment isn't expanding this year, I'm treating them as a churn risk. Bucket 3: Smart-touch accounts. These are smaller customers who don’t fall in our ICP and thus have lower potential to grow. They get automated workflows, AI-powered support, and self-service resources. My one CSM managing this segment focuses on one-to-many campaigns and proactive outreach based on product usage signals.  Here’s the big emphasis: I'm staffing based on what customers need to be successful, not just how much they're currently paying us. 💡 If you’re exploring this shift too, I shared a webinar last year breaking down how signals from support data can drive growth — dropping it here for anyone who wants to go deeper: https://bit.ly/4aD7Nxg It’s only January, but I feel like it’s helping my CSMs be more focused. They know exactly what they're optimizing for in each segment. How do you segment your CS book?

***Hyper-segmentation in Cold Email*** We worked with a Product Venture Studio in August 2023. They wanted to go after a VERY specific segment. DTC businesses that are facing specific website issues, AND have revenue above $1M. Quite hard to crack, right? We built a custom segmentation workflow to make this happen. Here are the segmentation criteria we created: 1️⃣ Website branding needs an update 2️⃣ Product pages lack content about the products 3️⃣ Social media presence is inconsistent 4️⃣ Domain & SSL errors 5️⃣ No “Buy now” or “Shop now” option available 6️⃣ Checkout is not mobile friendly We took screenshots from the errors we identified at each company. And then built specific email templates for each segment. e.g. - Segment A = Website visually appealing + Social Media inconsistent - Segment B = Website not visually appealing + no “Shop now” option *Email template* Hey Maria, Tried to visit the website from my phone, and I came across this: {{screenshot}}. Many DTC brands lose money and clients by not having a mobile-friendly checkout. It’s not hard to fix this, though! Would you like me to send over a case study for how BOOM! By Cindy Joseph 3x their conversion rate in 2 months? — THIS is true personalization. No more “I noticed {{companyName}} is hiring”. ❌❌❌ Have you used any crazy segmentation workflows in your Cold Email campaigns?

Understanding your customers shouldn’t be guesswork… This customer behaviour analysis was carried out for an E-commerce firm that seeks to examine how customers interact with their product, service, or platform to understand their actions, preferences, and decision-making processes. To address this, I followed a structured data analysis process: 📍 Data Collection & Cleaning – I gathered customer demographic, browsing, and purchase data, then cleaned it to remove duplicates, handle missing values, and ensure consistency. 📍Exploratory Data Analysis (EDA) – Through summary statistics and interactive visuals, I explored key metrics to identify patterns and anomalies. 📍Segmentation – I segmented customers based on behaviour and demographics (e.g., high-value buyers, age groups) to reveal distinct personas. 📍 Behavioural Analysis – I tracked customer journeys, identifying drop-off points and common conversion paths to understand what drives engagement and sales. 📍Insight Communication – Using Power BI, I translated findings into clear dashboards and visuals, enabling stakeholders to grasp trends and make data-driven decisions quickly. Each step brought us closer to the 'why' behind the numbers, so we could move from data to strategy. The result? A more data-informed understanding of their customers, and concrete strategies to improve engagement and retention. Curious how data can unlock hidden customer value? I’m always open to a conversation. Let’s connect and share insights. Have a lovely weekend!! #datafam

Something remarkable happened when we started bringing Customer Success leaders into our sales conversations. The traditional sales process transformed into a strategic partnership discussion that benefited everyone involved. After implementing this approach across hundreds of deals, we discovered benefits that went far beyond our initial expectations. Sales teams gained a deeper understanding of post-implementation challenges, which helped them qualify opportunities more effectively. Instead of focusing solely on closing deals, they began asking questions about operational readiness, internal champions, and resource allocation. Prospects received authentic insights into what successful implementation truly requires. Our CS leaders shared real examples of customers who thrived and openly discussed common obstacles they might face. This transparency built trust and helped prospects make informed decisions. Better aligned customer expectations from day one. When CS leaders joined these conversations, they highlighted potential roadblocks and success metrics based on similar customer profiles. This practical guidance helped prospects understand the work required to achieve their desired outcomes. This early involvement proved invaluable for our CS team. They gained visibility into the customer's vision before contracts were signed, allowing them to proactively plan resources and create tailored onboarding strategies. A surprising result was the reduction in "rescue" situations during implementation. We eliminated many issues that typically surfaced months into the relationship by addressing potential challenges during sales discussions. The data supported our approach. Deals that included CS leaders showed 40% higher implementation success rates and 25% faster time-to-value. More importantly, these customers renewed at significantly higher rates. For those considering this approach, start small. Choose strategic opportunities where CS insights could substantially impact the prospect's decision-making process. Document the outcomes and refine your strategy based on that feedback. Great customer relationships begin with the very first conversation.

After sending over a billion emails for 600+ brands… here are my 7 top tips for selecting the right audience. You can have the best email creative in the world — but if it lands in the wrong inbox, it won’t convert. Audience is everything. Here’s what we’ve learned at esbconnect after years of powering customer acquisition for brands like Tails.com | B Corp , AA Insurance and ASOS.com : 1. Target by behaviour, not just demographics Look for people who open, click, and act. Intent beats age and gender every time. 2. But… don’t always go for the obvious behaviour When Tails.com wanted to reach new pet owners, you'd assume targeting people engaging with pet brands would outperform, right? Wrong. They were being over-targeted. Instead, we found higher conversion by targeting segments engaging with health, home and subscription offers — less crowded and more curious. 3. Test broad, then narrow Start wide to understand what actually performs — then double down. Too niche too soon and you lose scale and surprise wins. 4. Layer in recency Someone who interacted with an email yesterday is more likely to convert than someone who did 3 weeks ago. Recency = relevance. 5. Don’t ignore ‘non-buyers’ Sometimes your best audience is one that’s never bought from the category — yet. Think curious, not converted. 6. Think beyond income — target by contextual wealth We’ve seen clients waste budget by targeting £100k+ earners assuming they’re affluent. But some of the wealthiest people are those on modest incomes with low outgoings — think high equity, long-term property owners with few financial ties. 7. Make it locally relevant A £1m house in London doesn’t signal the same wealth as it does in Scotland or Wales. Tailor your audience selection to geography and cost of living — precision wins. Audience strategy isn’t guesswork. It’s data, nuance, and constant testing. Want help finding your best segments? We’ve got 17 million opted-in UK profiles and years of experience to test with.

My Favorite Analyses: the Recency-Frequency matrix. This simple yet powerful framework goes beyond traditional segmentation to provide actionable insights into customer behavior. By focusing on how recently and how often customers engage with your brand, you can tailor your strategies to maximize lifetime value. Why it works: - Recency: Customers who have purchased recently are more likely to purchase again. It's a strong indicator of engagement and future behavior. - Frequency: Customers who purchase more often demonstrate loyalty and satisfaction, leading to a higher customer value. Recency and Frequency are the most important indicators of customer value, exhibiting more correlation to CLV than Monetary Value which is the third component in traditional RFM analyses. The Recency-Frequency matrix helps you categorize your customers into segments based on behaviors instead of factors like demographics or psychographics that imply actions. The analysis reveals distinct customer segments that require unique marketing strategies, including your Champions, the customers who Need Attention, and those who have Already Churned. Implementing the Matrix: Depending on the size of your customer dataset, the Recency-Frequency matrix can be built in a spreadsheet or a more hefty tool like SQL or R. - Excel/Google Sheets: Use `MAXIFS`, `COUNT`, `PERCENTRANK`, and a pivot table to build the Recency-Frequency matrix, but watch out for row limits. - SQL: Leverage functions like `DATEDIFF` and `COUNT` to calculate metrics, and segment with `NTILE`. - R: The `RFM` package handles large datasets with ease, offering advanced segmentation and visualization. This approach isn’t just theory — it’s a data-backed method for ensuring your marketing dollars are spent where they’ll make the most impact. DM me if you'd like to learn more, including the marketing strategies that I most commonly recommend for each Recency-Frequency matrix customer segment. Art+Science Analytics Institute | University of Notre Dame | University of Notre Dame - Mendoza College of Business | University of Illinois Urbana-Champaign | University of Chicago | D'Amore-McKim School of Business at Northeastern University | ELVTR | Grow with Google - Data Analytics #Analytics #DataStorytelling #MyFavoriteAnalyses #ROI #MROI

You saw the ad. You ignored it. You saw it again. Still ignored. Now you see it 6 more times. Welcome to modern D2C retargeting. Most D2C brands retarget like everyone’s always interested. Spoiler: they’re not. We audited 14 Indian D2C brands in April. Different categories. Different spend levels. ↳ But one common problem across the board: → Retargeting was quietly eating up 25–30% of ad budgets… and delivering almost no real lift in conversions. ↳ Here’s what we saw again and again: → Brands targeting the same audience across multiple campaigns. → 30-day visitors are still being hammered with BOFU ads on day 27. → High-frequency users keep seeing offers they’ve already ignored. → Everyone gets the same retargeting creative, no matter their intent level. And the worst part? Meta charges a premium to show ads to warm audiences or even if they’re cold in behavior. ↳ Why this hits harder in India: → COD mindset means More hesitation, slower decision → Lower trust in new D2C brands → Most retargeting is not segmented by behavior or timing You're not nurturing. You’re nagging. ↳ What I suggest brands to do instead: → Cap frequency and refresh retargeting ads weekly. → Use behavioral segments, not just "all visitors". → Retarget with timing logic, not desperation. ↳ My Fix for Smarter Retargeting Strategy 1. Segment your retargeting audiences → 1–3 days: Hot. Hit with offer. → 4–7 days: Educational reminder → 8–14 days: Testimonials, COD trust → 15–30 days: Low-cost nudges, not hard sells 2. Set frequency caps for warm pools → Don’t let the same person see your ad 6–10 times. → It hurts trust and inflates CPC. 3. Use intent-based retargeting triggers → Add to cart ≠ View content ≠ 10 sec video view → Each needs a different message and urgency 4. Rotate your creatives weekly → Fresh visuals and new hooks equals higher re-engagement without annoying the user 5. Track spend split between cold vs warm → If warm is eating 40%+ of budget with low conversions then pull back and fix segmentation. → Swap "Buy Now" with reminder, education, or social proof style creatives. Recap: ✅ Over-retargeting is a silent budget leak in Indian D2C ✅ Meta doesn’t care how relevant your retargeting is, you need to fix it ✅ Smart segmentation and message match means better ROI and trust ✅ Most CAC spikes come from lazy retargeting, not bad ads ✅ Treat retargeting like a nurture funnel, not a sales wall It’s not that your retargeting isn’t working rather it’s working too hard on the wrong people. Sometimes scaling starts by cutting what’s quietly bleeding your best budget. Spending ₹10L–₹50L/month and not sure if your retargeting is actually working? Let’s chat. A 30-min chat could save you lakhs in silent leaks.

Stop guessing your growth path. Map it instead with the Lean Canvas model. Last year a client was losing cash after a bad investment. Their Board wanted a clear plan, but management's ideas were scattered. Pressure rose as their cash runway shrank. I used a blank Lean Canvas and met with management. Box by box, we turned fuzzy thoughts into clear statements. In a few hours, the team could see the whole business on one page. A week later, decisions sped up, waste was cut, and revenue began increasing. The Board praised the new focus because just one sheet had replaced weeks of endless slides. 1. Start with the Problem box because pain fuels purchase: ⇀ List the top three headaches your market hates. ⇀ Ask customers for blunt complaints. ⇀ Rank pains by urgency and frequency.  ⇀ If the pain is weak, the plan is weak. 2. Name the Customer Segments who wake up with that pain: ⇀ Avoid lumping everyone together - be precise. ⇀ Describe one real person, not a demographic blur. ⇀ Note where they already search for help. ⇀ Specific faces drive focused solutions. 3. Your Unique Value Proposition attracts attention: ⇀ Write it like a headline your customer would repeat. ⇀ Highlight the biggest outcome, not features. ⇀ Short, clear value wins the click. ⇀ Keep it under ten words. 4. Now sketch your Solution: ⇀ Draft three bare-bones features solving each top pain. ⇀ Mockup screens or sketches quickly. ⇀ Show them to five prospects tomorrow. ⇀ Speed beats perfection in early design. 5. Channels tell you how messages travel to wallets: ⇀ Pick the two cheapest tests before buying ads. ⇀ Leverage existing communities and email lists. ⇀ Measure response time and cost per lead. ⇀ Cheap learning outruns expensive guessing. 6. Revenue Streams prove the idea can feed itself: ⇀ State exactly who pays, how much, and how often. ⇀ Compare price to the pain’s current cost. ⇀ Pilot a single pricing tier first. ⇀ Real cash beats hypothetical guesses. 7. Analyse Cost Structure for sustainability: ⇀ List the three largest costs and make them variable. ⇀ Negotiate monthly, not annual, contracts. ⇀ Lean costs preserve runway for learning. ⇀ Automate before hiring. 8. Key Metrics keep founders honest on progress: ⇀ Choose one north-star metric and two support numbers. ⇀ Link each metric to habit or revenue. ⇀ Track weekly in one simple dashboard. ⇀ What gets graphed gets fixed faster. 9. Finally, name your Unfair Advantage: ⇀ This is the asset rivals can’t match. ⇀ Lean on unique data, patents, or proven community. ⇀ Document founder expertise that speed cannot buy. ⇀ Without moats, margins leak. 10. Don't forget to summarise your high-level concept and identify early adopters too. Review our lean canvas model weekly to stay on track with your strategy. What's your favourite strategic model? ------- ♻️ Repost to help others in your network. Follow Jonathan Maharaj FCPA for more insights on accounting, finance and leadership.