Why Segmentation is Crucial
I often get asked the question, “Why should I offer different customer experiences? It’s so much more efficient to focus on one experience!” While I appreciate their bias for efficiency, the truth is that being efficient by itself isn’t enough or may not be the right solution for every type of account.
One of my favorite metaphors that Jamey Jeff, Chief Customer Officer at Cortex Building Intelligence, shared with me for my book, The Startup’s Guide to Customer Success, best encapsulates this idea.
“Customers start using your product with varying levels of experience. Some are novices and don’t know much about your product; they will need more handholding during the onboarding process. On the other hand, some are already experts; these are the users who perhaps have been a customer of yours before at their previous companies — they might know more about the product than you do! Experts often just want you to get out of their way when it comes to onboarding.
Clearly, these two types of customer personas will need different
experiences.
For example, say you’re selling cars. There are some customers who will flip through the entire owner’s manual before even getting into the car. Then, there are others that want to just start the car, turn on the radio and go.
These two types of customers should have different car buying experiences. By swapping their experiences or giving them both the same experience, you will starve those in group one and overwhelm or annoy those in group two.
For example, if you gave both types of customers a car brochure, those who needed more help will feel lost and those who wanted to take the car and go will probably not even open the brochure.
By segmenting your customers, you can invest your time more wisely. Most companies just look at deal value or customer size when segmenting. This is important to ensure you’re profitably servicing your customers, but sophistication is just as important. Large enterprise customers can be novices, and SMB customers can be experts. They both are going to need different onboarding experiences. Know what they need and when they no longer need you to be there.”
The objective of segmentation is to create the most appropriate experience possible for your customer. It is important the organization understands the customer’s needs and caters to the customer at their level, especially at scale. By grouping your customers into similar characteristics, you can better address their concerns and help set everyone in the group up for success.
