What is Customer Segmentation in Retail? Explained

Customer segmentation is a marketing strategy that involves dividing a customer base into distinct groups based on shared characteristics, behaviors, or demographics. The goal is to better understand and target specific segments with tailored marketing approaches that resonate with their unique needs and preferences. By categorizing customers into segments, businesses can create more personalized and effective marketing campaigns, improving customer engagement and satisfaction. Common segmentation criteria include age, gender, geographic location, purchasing behavior, and interests. This strategic approach allows businesses to allocate resources efficiently, provide targeted messaging, and enhance the overall customer experience, contributing to long-term customer loyalty and increased profitability.