Traditional B2C segmentation is a myth

By Praneet Chandra on August 15, 2018

Talk with two “male, single, thirty-year-olds living in Manchester” and you may find their preferences to be shockingly different.

Small details like their work profile, neighbourhood or time of browsing could equate to a huge difference in tastes. With this in mind, Peak’s head of product, Praneet Chandra, explains why traditional customer segmentation is no longer a viable option for B2C businesses…

In today’s world, categorising customers into a single segment to receive the same generic blanket email is simply not an option for businesses who want to see real growth from their marketing.

Customer populations are far more divergent, represented by hundreds of thousands of data points, and not just a handful of segment variables. And, on top of this, customers are demanding increasingly relevant experiences, especially in industries such as retail.

Companies now need a new intelligence system that both tests and adapts to every customer it interacts with. Segmentation is no longer five variations of a campaign or 20 variables, but potentially millions of unique consumer experiences each day – and that means as many unique campaigns as you have customers in your world.

To see this in action, look no further than Netflix or Amazon. Personalisation is a music they’ve been playing since 2014. In fact, they like to say they have 20-30 million customer segments.

Retailers or CPG companies that want to thrive in this current landscape have to deliver one-to-one experiences, at scale. This level of machine learning is about to disrupt the world of customer marketing automation platforms.

With AI at its core, machine learning segmentation models can run thousands of repetitive tests, continuously and rapidly optimising each and every customer interaction, and adapting to customer behaviour across all the marketing channels.

Ultimately, this will allow brands to build lasting customer retention at a scale that is not humanly possible.

One final reason personalisation efforts will continue to fail alongside major retailers? Many companies are sticking to the sidelines, taking a wait-and-see approach. This puts them at risk from competitors who are already investing heavily in AI.

Unless a retailer want to earn a place on the annual bankruptcy lists, they have no choice but to evolve with their customers and offer them a truly personalised experience in every interaction they make.

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