Customers are expecting more than ever from their interactions with brands. Getting it right in this increasingly competitive age of retail can be make-or-break.
Customer segmentation has long been a pillar of campaign planning and audience building, but truly personalized experiences require more than traditional segmentation.
A Forrester report titled “The Best of Times and the Worst of Times for Segmentation,” (which you can download here for free) will help you navigate the complexities of customer marketing, segmentation, and personalization and help you tailor customer experiences that foster long-term engagement and loyalty.
So, is segmentation really dead? The answer, of course, is complicated. In the report, Forrester Principal Analyst Brandon Purcell argues that traditional customer segmentation is over. We are no longer in a world where rules-based segmentation provides the level of value needed to justify the effort.
Despite its limitations, retail brands may have trouble letting go of segmentation because it has been so ingrained into how we think about our marketing messages and how they relate to consumer demographics at large. And while automation and triggered messaging solutions may be able to handle part of the equation, this only accounts for a small portion of the overall customer marketing plan.
Personalization is the next frontier, and it requires the ability to react intelligently to both overt signals (for example, “this customer put this product in their cart”) and latent signals held within dynamic, behavioral customer data.
What happens when you stop relying on traditional segmentation rules to target your customer campaigns? The results can be surprising. French retailer Galeries Lafayette targeted mostly women when promoting women’s products and mainly men for men’s products. Once they added Tinyclues’ AI-driven customer marketing solution, which uses their first-party data to help determine the audiences most likely to bring engagement and revenue, they found that their targeting should actually be mostly women for men’s campaigns (80%), and should be around 25% men for their women’s campaigns. This change resulted in an in-store and online campaign revenue increase of 34%.
This is just one example of AI leading the personalization revolution. Download the report to read more about this and:
- Why traditional approaches to segmentation fall short;
- How to develop and deliver personalized experiences that resonate with your customers’ shifting emotions, attitudes, and preferences;
- Real-world examples from companies, like Air France and Galeries Lafayette, successfully implementing AI technologies to inform their market strategies and grow campaign revenue.