Customer Segmentation & Targeting (Knowing your Customers- KYC)
KYC is the term most commonly used by banks with reference to documents they collect for identifying & verifying their customers. So, what does it mean for all businesses?
Do businesses know who their customers are? How important is knowing your customers?
We have all heard and learned about customer segmentation & targeting. If done right businesses can connect with their customers with the right content at the right time and place, to achieve their marketing goals.
The first step is to identify the target customer and create buyer personas basis of their demographic, Psychographic, Geographic, and Behavioural habits
What happens when the target market is well defined and businesses are able to relate them to their product or services
Reaching the right set of audience
Once the target audience is defined all the marketing efforts can be tailored to reach this set of prospective customers. The marketing plan will be focused on building personalized campaigns to reach the target segment. Personalized messages make the customer relate better to company products or services. Thereby assisting businesses to get better returns. The exercise also avoids wasteful expenses & efforts.
Targeted High-quality Leads
The perfect market segmentation & targeting allows businesses to attract the right audiences, and also reach them with relevant content. The targeted ads have a greater probability for the customers to buy your products
According to recent research conducted*
- 88% (Eighty-eight percent) of consumers say that personally, relevant content improves how they feel about a brand.
- 78% (Seventy-eight percent) say that personally, relevant content increases their purchase intent for a brand’s products and services.
- 50% (Fifty percent) say that they would pay more for products and services from brands that do a good job of providing personally relevant content.
*Research Source Link- https://prn.to/3b4Lzcf
This leads to saying that the right market segmentation and targeting will optimize the campaigns and provide high-quality leads helping the organization to acquire more customers.
Gives Direction to the Product or Service
Defining your target audience lets you understand their likes and dislikes. You can then direct all your resources towards this group of customers, thereby avoiding sending any & all communications to the entire market. This leads to a focused approach to building your marketing campaigns.
Competitor Edge
Customer segmentation can also lead to a competitive edge as knowing your target audience can assist you in reaching & communicating with your customers better than your competition. It’s the same slice of the pie that we are all fighting for. Tailored content on social media, apps, websites with offers and promotions can leverage higher engagement and sales with the customer data that you have generated.
Higher Levels of Customer Satisfaction
Knowing your customers help businesses to guide their marketing efforts to serve customers better. This leads to improved customer satisfaction. A satisfied customer generates repeat purchases thereby increasing CLV (Customer Lifetime Value). Also, a happy customer becomes a brand ambassador creating brand advocacy.
Many businesses fail as they are not able to identify their customers and end up trying to sell the right product/ service to the wrong people
Hence customer segmentation is a very effective tool for businesses today as it closely aligns their strategies & tactics in line with their customers. This helps in targeting the customers better. A customized approach is needed as every customer is different & so is the customer journey. As a singular approach won’t help, Know Your Customer (KYC) is “The Important” aspect of any business.