How to segment WooCommerce customers

In this article, we look into different types of WooCommerce customer segmentation methods and how to implement them on your website.

In a world where each individual has his preferences, it’s vital to define your target audience. There are no universal products, thus we need to know which audience finds the most value in our products. That’s where a well-defined segmentation strategy comes into play.

Customer segmentation is important part of the customer management process and helps us focusing resources where they bring the most results. But implementing this in your WooCommerce store may be a challenge. Since the user’s list has little information about your customers we need other tools to truly benefit from segmentation.

customer segmentation strategy

WooCommerce customer segmentation: Strategy Elements and Definitions

Customer segmentation is the method of grouping similar customers together. This process takes into account different aspects of your customers. It is done to apply similar strategies to similar customers, and make sure results are increased.

It’s important to notice that the segmentation criterion is subjective. Thus, you can use whatever works best for your application. But usually, some company types find better results by segmenting customers using certain criteria. In general, customer segmentation can be done by:

  • Demographic segmentation
  • Behavioral segmentation
  • Psychographic segmentation
  • Geographic segmentation

Thus, usually, high-profile clothing stores probably segment WooCommerce customers based on demographic and psychographic aspects more. This doesn’t mean that geographic segmentation doesn’t work for them. It just means that the user address alone has less importance than a combination of their salary, age, and lifestyle.

Demographic segmentation

Demographic segmentation revolves around social-economic aspects. In this kind of segmentation, your customer’s characteristics are important. For example, a luxury car brand can segment leads based on their income, as that’s a deal-breaker.Besides, they know that there are other important segmentation factors, such as age, occupation, or even gender.

It’s possible to use Users Insights to create this kind of WooCommerce customer segmentation. You just need to activate the dedicated WooCommerce module. If you want to segment by custom data, you just need to collect this information as custom user fields, using a plugin or custom methods. For instance, if you want to filter customers who are 20 to 35 years old, you can use their birth date as a filter:

Filter users withing the 20-35 age range

 

This kind of segmentation allows you to get in touch with these customers, or simply understand your WooCommerce customer base. Furthermore, it’s possible to combine multiple demographic segmentation aspects. Thus, if your target audience is 20 to 35 years old but designers as well, you can combine these two filters:

Filter users based on age and profession

It is important to notice that demographic segmentation works well for business-to-business scenarios. For instance, you may segment your customers depending on the business size. In that way, the characteristics of your business client are more important than the characteristics of your contact. For that, you just need to filter WooCommerce customers who work for a business with the elements you are looking for. Here is an example, if your target audience is small businesses, you can filter customers based on their business size:
Filter users based on business size

 

Geographic segmentation

Surely, as businesses become global it’s possible to sell across multiple countries. But this doesn’t imply that all locations are equal. There are important aspects bound to geographic limits, such as culture, language, or even the logistic. Thus, some products and services can benefit from geographic customer segmentation.

Users Insights has a GeoLocation module. This means that you can do geographic segmentation using Users Insights’ filters. Additionally, you can use Customer data from other plugins, such as WooCommerce subscriptions or WooCommerce membership for user location details. Furthermore, other custom fields can be used for indirect geographic segmentation. That’s the case for phone area codes or even the user’s preferred language.

Usually, the first experiment regarding geographic customer segmentation is simply filtering them by city, area, or even their country. For instance, here we filter all users from the US:
Segmentation strategy for geographic segmentation

In addition to the table view, you can use the map view. You can activate it here:
View geographic segmentation in a map view

And this is the display of our WooCommerce customers on a map:
View users on a map along with their location

This is a quick overview of where our customers are in a specific area. You can zoom in and out, aggregating or detailing specific points as you do that.

Expanding a bit more, we can find other customers for the geographic customer segmentation strategy. It is particularly interesting when you have multiple data sources. For instance, if you use the Users Insights and WooCommerce. You can compare the GeoLocation data with the customers’ billing address. This information can be quite useful for better user segmentation in your marketing and logistics.

Behavioral segmentation

Behavioral segmentation is based on users’ actions and needs. It is a complex topic as there are many layers inside of this segmentation method. Usually, there are 4 main subgroups of segmentation strategies when it comes to customer behavior.

  1. Occasion oriented: Think of birthday hats, valentine’s day gifts, class rings. These are products bought for specific times, be it once in a lifetime or in repeated times during their lives.
  2. Usage oriented: This behavioral segmentation strategy is based on how often the product or service is used. Thus users can be heavy and avid users, or light and occasional ones. An example is social media sites, electronics (phone brands have wide ranges depending on the user’s behavior).
  3. Loyalty oriented: These are markets segmented based on how inclined customers are to switch to another brand. At this point, it’s important to notice that customers could be loyal (or not). Thus, this segmentation can be used in addition to others. Here you can think of businesses that depend on the users’ lifetime usage, such as local businesses or even niche software providers.
  4. Benefits sought: For benefits segmentation, we care about the customers’ main reason to buy. For instance, a Tesla can be bought for its green energy appeal, for its tech features, or based on status. Each of these customer types resonates with different marketing messages and seeks specific brand relationship aspects.

Each of these behavioral segmentation variables can be collected with Users Insights. Here are some ideas for each.

For occasion-oriented segmentation, it’s possible to track customers based on their last purchase date, their birthday, or enrollment date. These data points show you when their next purchase can be and you can act accordingly. For instance, here is how to filter customers based on order date:
Filter users based on purchase dates

Regarding usage-oriented segmentation, you can find the customer profiles looking for their past orders or visits. Repeat buyers or active users are likely to be heavy users, while others are occasional users. For example, let’s filter all users with many orders and site visits:
Filter most active users with repeat orders

As for loyalty-oriented segmentation, we need to find the right mix between active and longtime customers. As we don’t have access to our competitor’s data, it’s impossible to know when customers switch providers. But a good telling is when a customer used to buy from you, then stopped. Usually, this starts by defining your customers’ buying cycle, for example, 90 days. Then you can filter all customers who haven’t ordered for more than that period.
Filter users who haven't bought recently

Now comes the benefits sought segmentation. This may be tricky if you have a single product. But usually, your variations and accessories may show the specific benefits a customer is after. Customers who pay more for a special color of Tesla, with no additional comfort features are probably looking for aesthetics. Therefore, you can apply this to your products. If Tesla sold each of its add-ons separately, for example, this is how they would filter aesthetics-seeking customers.
Filter users based on products bought

 

Psychographic segmentation

To conclude our segmentation strategies overview there’s the psychographic segmentation. In this type of customer segmentation, we look for lifestyle choices, personal interests, opinions. As you may imagine, it is harder to passively collect this. We can easily collect the user’s location or even their actions on your site. But it is much harder to know if they are aggressive or conservative investors. It is hard to know their dietary options. Thus, in this type of segmentation strategy, often we rely on surveys.

If psychographic segmentation is important for you, then it’s likely that you need to run surveys and offer rewards. This is a quick way to build reliable information. If you use a plugin such as Gravity Forms, it’s possible to filter users based on their replies. For instance, we can filter all the vegan users, and send them a link to our new vegan line:
Filter users who have filled in the survey and who identify themselves as vegans

Additionally, if you already have lifestyle-based products you can segment customers based on them. For instance, if you have a vegan makeup line, customers who bought it are likely interested in vegan products. Thus you can filter customers based on products bought and get this information:
Filter users who bought vegan products

 

Conclusion

Today we looked into different WooCommerce customer segmentation strategies. We went through each of the customer segmentation types in detail, with examples of how to implement them. By the end of the day, you should be able to segment customers based on your preferred segmentation strategy.

We hope you enjoy it, and see you again next time!