Customer segmentation

Customer segmentation is the practice of grouping customers by shared characteristics, behaviors, or needs. It helps organizations understand their audience, tailor products and services, and create marketing campaigns that fit each group more closely.

Example

A bank might use customer segmentation to group customers by income, age, account balances, and product usage. By understanding the needs of each segment, the bank can create targeted marketing campaigns, offer suitable financial products, and provide more relevant customer support.