Get a deeper understanding of Aqurate's Value Engagement Segmentation model and learn how to get the most out of it.
Why use behavioral segmentation?
Not all your customers are the same. Some are just getting to know your brand, while others are true champions. So, why use the same messaging and actions for all?
Behavioral segmentation helps you understand your customers and automatically categorize them by analyzing vast amounts of data. This way, you can focus on important customer segments that are likely to give you a higher return on investment and also tailor your marketing messages and offers for each of these segments’ needs. When done right, the result is increased Customer Lifetime Value and decreased churn.
What is the Value-Engagement Model?
The Value-Engagement Model provides an intuitive way to segment your customer base. Depending on how valuable they are to you and how engaged they are, the model classifies your customers into one of 7 natural segments.
The Value axis represents the amount of money a customer has spent on your website over the last 12 months of their lifetime as a customer.
The Engagement axis represents how involved a customer is with your business. The more recent the latest order or website visit (still in alpha) of a customer is, the higher the engagement value is.
How should you use the segments?
Prioritizing the segments
The hardest thing about behavioral segmentation is getting started, so here is a great way to prioritize your work:
- Reward your True Champions
- Save your Spenders at Risk
- Push your Excited Shoppers to purchase again
- Build up loyalty with your Faithful Supporters
- Captivate your Curious Entrants
- Engage the Average Buyers
- Activate the Silent Quitters, maybe
💡 Your most valuable and highest engaged customers who can promote your brand.
About True Champions
The True Champions are your most valuable and the highest engaged customers. They’ve made valuable orders and they are still purchasing. They currently generate significant revenue, and a lot of your future revenue depends on them too. Moreover, they can become early adopters of new products and will help promote your brand.
Suggested actions for True Champions
|Reward them||For example, offer them free samples at checkout, free shipping, and other personalized gifts|
|Make them feel important||Write them a letter of gratitude; give them a call; invite them for a free factory tour|
|Show off new products||Give them the exclusive chance to pre-order, so they’ll have the latest released products first|
Spenders at Risk
💡 They have spent large amounts of money, but are drifting away lately.
About Spenders at Risk
The Spenders at Risk are those customers who have spent large amounts of money, but their engagement is low lately. They didn’t return to your website for a while so you need to re-engage them. They used to be your True Champions or Faithful Supporters, so you cannot afford to lose them. If your product has high recurrence (e.g. shampoo), they most probably moved away towards a competitor. Bring them back with relevant promotions and run surveys to find out what went wrong.
Suggested actions for Spenders at Risk
|Talk to them||Run a survey to find out what went wrong, or even call them|
|Offer a personalized experience||Re-engage them with hyper-personalized product offers and retargeting ads|
|Show off new products||Give them the exclusive chance to pre-order, so they’ll have your latest products first|
💡 Your highly engaged customers with medium spending who can become True Champions.
About Excited Shoppers
Excited Shoppers are those customers who are highly engaged, but still have medium spending with you. As you already succeeded in creating high engagement, you should now focus on increasing the revenue from this segment. Offer them membership or loyalty programs, and recommend related products to cross-sell and up-sell so they become True Champions.
Suggested actions for Excited Shoppers
|Cross-sell and up-sell||Send personalized product recommendations via email or app notifications so they purchase more and higher-value items than in previous purchases|
|Offer value-based benefits||Offer discounts and free shipping based on order value|
|Offer loyalty benefits||Invite to your loyalty program (e.g. based on credit points)|
💡 Engaged customers with high spending who are likely to be loyal to your brand.
About Faithful Supporters
The Faithful Supporters are engaged customers that have spent a great amount of money with you. They are often likely to recommend you to their friends and family. They are highly valuable for your business as they have a clear and probably positive view of your brand. Keep them engaged with promotions and ask for reviews, as they are among your biggest marketing awareness assets.
Suggested actions for Faithful Supporters
|Cross-sell||Send them personalized product recommendations via email or app notifications to encourage new orders|
|Ask for reviews||Contact them via email, your app, or direct message to encourage them to give you a review after each purchase|
|Propose referral programs||Offer them vouchers if they refer your website/products to their friends|
|Offer time-bound benefits||Provide benefits like free shipping and promotions with an expiration date to incentivize action|
💡 They made low-value purchases and are getting to know your brand.
About Curious Entrants
The Curious Entrants are those customers who engaged with you lately and made low-value purchases. Most of the time, they are just getting to know your brand. They have great potential to become great contributors to your overall revenue. Start guiding them through your product portfolio and show them how you’re better than the competition.
Suggested actions for Curious Entrants
|Invest in brand-affinity||Send them newsletters about what sets your brand apart and offer them useful resources related to your industry|
|Offer bundle discounts||Create discounted bundles on your website and via email to help increase their total spending; give them special coupons for the next order|
|Cross-sell||Send them personalized product recommendations with cross-sell products via email or app notifications to promote the next purchase|
💡 They don’t stand out in terms of either value or engagement but have a great potential.
About Average Buyers
The Average Buyers are those customers who don’t stand out either in terms of value or engagement but have a great potential to become True Champions or Faithful Supporters if managed well. So, try to encourage new purchases from them without investing too much effort. Some of your options include small, time-bound benefits and automated cross-sell and up-sell emails.
Suggested actions for Average Buyers
|Offer time-bound benefits||Send them limited-time offers (small discounts, coupons, free shipping) via email, app notifications and customized pop-ups on your website|
|Cross-sell and up-sell||Send them personalized product recommendations via email or app notifications so they purchase more and higher-value items than in previous purchases|
💡 They have low spending and are barely engaged with your shop.
About Silent Quitters
The Silent Quitters bring you the lowest revenue and stopped visiting your website and purchasing a while ago. You can try to reactivate them, but do not put a big effort into this type of customer.
Suggested actions for Silent Quitters
|Recreate brand value||Remind them about how great and special your brand and products are|
|Show off new products||Notify them about your new products via email newsletters|
Implement the actions for each segment
Customer segments can be used in various ways and through various channels; we suggest you try them all at some point. Here are the main, most-used, and easy-to-implement channels:
Connect your email sending tool (check the available integrations) to automatically import all your Aqurate segments. Once that is done, each customer will have a segment allocated as a tag or property (depending on the email tool). If your email sender is not supported, you can download the segments as a CSV file that you can import into (almost) any tool out there. Then, you can create tailored customer journeys and start sending newsletters and marketing messages tailored to each segment.
Link your segments to ad platforms such as Facebook Ads and create remarketing campaigns. This can be currently done by downloading the segments as a CSV file that you can import into the ad platform. You can also create lookalike audiences to get new customers. For example, you can create a True Champion lookalike audience to get new qualified customers with a high potential value to your business.
💪 Manual outreach
Depending on your business type and size, you can pick up specific customers or segments and call them on the phone to re-engage them or to thank them for being loyal to your brand. Another option would be to select the ones to receive personalized gifts with their orders.
Questions about getting started? We're excited to help: firstname.lastname@example.org