Using Customer Segmentation to Personalize Retail Experiences

Understanding your customers’ behaviors and responding accordingly is key to sustained business success. In yesterday’s post, I introduced the Recency-Frequency Matrix, a powerful tool for customer segmentation that helps businesses identify and prioritize their most valuable customers. Today, I want to take it a step further by showcasing how this analysis can inform targeted marketing strategies to drive engagement and growth. Strategic Actions Based on the Recency-Frequency Matrix: Champions: These are your top-tier customers who purchase frequently and recently. To maintain their loyalty, consider offering early access to new products or services, implementing a robust loyalty rewards program, and sending highly personalized communications. Loyal Customers: Customers in this segment are consistent buyers but with slightly less frequency. Encourage more frequent purchases through special incentives, reminders of your product or service benefits, and targeted re-engagement campaigns. Needs Attention: These customers have shown steady engagement but may need a prompt to stay active. Reactivation campaigns with tailored offers, requesting feedback, and exclusive deals can help prevent potential churn. Churn Risk: These customers are at risk of disengagement. Win them back with significant incentives, reminders of positive past experiences, and personalized offers designed to reignite their interest in your brand. Already Churned: For customers who have not engaged for a while, occasional check-ins or updates, targeted ads for reintroduction, and a focus on acquiring new customers might be the most efficient use of resources. Leveraging a Recency-Frequency Matrix not only provides a clear view of where your customers stand but also empowers you to implement highly tailored strategies that maximize both engagement and ROI. Art+Science Analytics Institute | University of Notre Dame | University of Notre Dame - Mendoza College of Business | University of Illinois Urbana-Champaign | University of Chicago | D'Amore-McKim School of Business at Northeastern University | ELVTR | Grow with Google - Data Analytics #Analytics #DataStorytelling

Personalization isn't just about adding a <dynamic name tag> in your follow-ups. That’s table stakes. Go deep, get relevant, and it will add rocket fuel to your paid efforts by lowering CAC and driving LTV. Here are 5 key personalization and segmentation tactics we’re running with Klaviyo this year to supercharge our growth: 📈 1. Triggered flows from high-intent actions Quiz completion, PDP views, cart hovers…we don't wait for them to just remember us. We create experiences that tie back to their interests and behavior. The setup: - Someone completes our quiz → immediate flow based on their results - Product page browsers → targeted follow-up for that specific SKU - Cart hoverers → urgency sequence before they forget Result: better conversion than universal welcome emails because they're contextual, not generic. 🔁 2. Dynamic segments that update in real-time Goal here is to build logic, not static lists. If someone browses 2+ collagen SKUs but doesn't purchase, they're moved into a "Collagen Consideration" segment automatically. If they buy, they're moved out. This keeps messaging relevant and timing tight, without needing manual intervention. 🧠 3. Predictive churn alerts + automated winbacks We use churn prediction scores to ID high-risk customers before they stop buying. Example: When someone views your 'Cancel Subscription' FAQ, they automatically get a churn prevention sequence within 24 hours. The flow: → Educational content + stronger value props → One-time discount to "pause" rather than cancel → Reminder of points or rewards they'd lose Win back a higher percentage of your churn-risk users this way (without hoping to retarget them on Meta). 🎯 4. On-site personalization from zero-party data When a customer shares goals or preferences in a quiz, we don't let that data sit. We use it to personalize everything from email subject lines and SMS follow-ups. "Looking for joint support?" → Product recommendation shows collagen SKUs, not fat burners. This creates a more relevant buying journey and lowers decision fatigue. 🔄 5. Cross-channel sequencing (email → SMS → onsite) We build orchestration into the flow logic, not just "blast and pray." Day 0: Email with their quiz results Day 1: SMS with a limited-time offer Day 3: If they return, they see a pop-up based on their quiz results This cross-channel sequence drives higher engagement while avoiding overexposure on any one channel. The tool that makes this possible is Klaviyo, and this is just a small example of what we’re building with it. Because it’s a full-on B2C CRM, Klaviyo lets us create highly personalized, high-performing flows at every stage of the funnel. If you’re still just batching and blasting, I recommend checking them out: https://lnkd.in/d7pKaQRB #Klaviyopartner

Using "Hey {first name}" in your marketing emails and calling it personalization is like picking up a rock and calling it a hammer. Technically, it works. But we have better tools now, and failing to take advantage of them is going to leave you choking on the dust of your competitors. Here's how to catch up with the times and use TRUE personalization to boost engagement, loyalty, and conversions: 1. Use dynamic content fields to customize emails based on customer attributes, behaviors, and preferences. Go beyond just {first name} – incorporate product views, past purchases, and customer lifecycle stage. Don't be creepy! Be conversational. You want the reader to feel like you understand their needs, not like you've been peeking through their blinds. 2. Set up behavior-triggered automations like browse abandonment and cart recovery flows. Make these highly relevant by including viewed products, social proof, and timely offers. Marketing is all about getting the right offer in front of the right person at the right time, and behavior-based emails are one of the best ways to do that on a consistent basis. 3. Implement Recency, Frequency, and Monetary Value (RFM) segmentation to deliver personalized messaging to different customer groups. Target VIPs, at-risk customers, and prospectives customers with specific messages to convert or retain them. 4. Create personalized journeys that adjust the user's experience based on customer data or actions. For example, if you're sending the exact same post purchase sequence to a repeat purchaser as you are for a first-time buyer, you're missing a huge opportunity. 5. Use replenishment flows for consumable products, reminding customers when it's time to reorder. Or, capture email addresses on PDPs for sold out products and notify them when the item in back in stock. Easy sales. Be careful to avoid these common personalization mistakes: 🙅🏼 Over-personalizing in a way that feels intrusive or creepy 🙅🏼 Sending irrelevant recommendations due to inaccurate or outdated data 🙅🏼 Over-segmenting to the point where segments are too small to be effective 🙅🏼 Using templated, robotic language that sounds unnatural The key is finding the right balance ––  personalized enough to be relevant and engaging, but not so specific that it becomes cringey or off-putting. When done well, personalization makes customers feel heard, understood and valued. This builds loyalty, increases engagement, and ultimately drives more conversions and revenue. Level up your personalization with one (or more!) of these strategies, and your KPIs are going to shoot up and to the right.