Here\u2019s a look at the benefits AI customer segmentation, the results of my AI experiment, and some of the top tools you can use to streamline segmentation.<\/p>\n In this article:<\/strong><\/p>\n <\/a> <\/p>\n Customer segmentation breaks your customer base into various subgroups. These subgroups can be based on multiple characteristics like:<\/p>\n This segmentation helps you better understand their needs and preferences. Then, you can create targeted messages that are more likely to resonate with your audience.<\/p>\n Here are the biggest benefits of AI customer segmentation.<\/p>\n AI quickly sorts large data sets to provide an in-depth analysis. These in-depth analyses better inform your research. In fact, 63% of marketers<\/a> use AI for market research today.<\/p>\n Think about that concerning customer segmentation. It\u2019s likely your company has various groups of customers, each with their own needs and preferences. You can quickly and easily sort your customers using AI based on various defining characteristics.<\/p>\n Plus, AI can provide you with sentiment analysis, which helps you better understand how these customers feel about your product or service.<\/p>\n It\u2019s no secret that personalization and segmentation are key to better marketing. Beyond that, with more advanced technology on the market, it\u2019s expected. As technology advances, 73% of customers<\/a> expect a personalized experience with a company.<\/p>\n Moreover, over half of consumers<\/a> say they\u2019ll become repeat buyers after a personalized experience. Using AI to segment your customer lists accurately can help your marketing and sales teams with revenue-driven strategies.<\/p>\n If customers are more likely to become repeat customers after personal experience with your brand, you also have a better chance of increasing customer retention. In fact, 62% of business leaders<\/a> agree that improved customer retention is a benefit of personalization efforts.<\/p>\n AI can help you determine what your customer segments care about and how they feel about your product or service. Appealing to their preferences, interests, and needs is a great way to keep customers on your accounts.<\/p>\n Segmenting your customers into various groups can help you learn more about their behaviors and patterns and predict how they\u2019ll behave. However, this can be a huge undertaking for one person, especially since it requires a large amount of historical data.<\/p>\n AI tools use historical and real-time data to predict your customers\u2019 behaviors. This is especially helpful for planning proactive measures rather than reactive ones.<\/p>\n The amount of time saved by using AI tools might be the number one benefit of customer segmentation using AI. According to a Salesforce survey<\/a>, marketers who use AI tools save an average of five hours per week.<\/p>\n Sure, that time likely accounts for content creation and other tasks, but it also accounts for market and customer research, including customer segmentation. What used to take hours to complete by hand now takes only a few minutes.<\/p>\n Not convinced? I ran a test to see if AI customer segmentation actually works \u2014 and it passed with flying colors.<\/p>\n <\/a> <\/p>\n If I learned anything from my favorite professor in college, it\u2019s this: always test things out. To see if AI can segment customers, I used ChatGPT. Here\u2019s what happened.<\/p>\n I created a fictional health and wellness business to get the most out of using ChatGPT for customer segmentation. Then, I described my client base. Here are the most important details about my business, Fitness for You.<\/p>\n Using this information, I want ChatGPT to sort my customers into the appropriate segments, including segments concerning:<\/p>\n I first entered my company\u2019s information to use ChatGPT for customer segmentation. The nice thing about ChatGPT is that it stores information, meaning there\u2019s no need to keep reminding it of previous inputs.<\/p>\n After entering my company\u2019s information, I asked ChatGPT to segment my customers based on fitness level. The key to using AI tools is to be specific. This is the prompt I used:<\/p>\n Pro tip<\/strong>: I\u2019ve found that asking ChatGPT to deliver results in a table makes them easier to read. Plus, copying and pasting the results into Google Sheets is easy.<\/p>\n Next, I asked ChatGPT to separate my customers into groups based on their attitudes toward the gym. This is the prompt I used:<\/p>\n Here\u2019s ChatGPT\u2019s response:<\/p>\n I like that ChatGPT continues to deliver the results in the table. I also appreciate that the response gives a description of my client segment and a guess about their preferences.<\/p>\n The final segmentation I want ChatGPT to generate is groups based on my clients\u2019 gym program interests.<\/p>\n This is the prompt I used:<\/p>\n Here\u2019s the final response:<\/p>\n ChatGPT\u2019s response categorizes my fictional clients based on their potential program interests and describes why those clients may be interested in the program. Knowing this information, I could easily create marketing campaigns based on their interests and preferences and, hopefully, gain loyal clients to my gym.<\/p>\n ChatGPT\u2019s customer segmentation of my fictional clients was spot on.<\/p>\n If I wanted to create customer personas and hadn\u2019t already done that, I could use the information provided to me by ChatGPT to create a persona for each customer segment. Or, if I was short on time, ChatGPT could create the user persona for me.<\/p>\n With more information, like age range and fitness goals, I could segment my clients further into more detailed groups. This would help me narrow down my focus for more accurate personalization and a better customer experience.<\/p>\n <\/a> <\/p>\n Looking for the best AI tools for customer segmentation? We\u2019ve got you covered.<\/p>\n Source<\/a><\/em><\/p>\n If you\u2019re already a HubSpot CRM user, what are you waiting for? HubSpot AI is an easy-to-use AI tool that you can use throughout the customer platform.<\/p>\n With HubSpot\u2019s CRM capabilities and HubSpot AI, you can create customer segments using historical and real-time data. Use this tool to create effective marketing campaigns, inform product development, and turn your customers into loyal fans.<\/p>\n What I like: <\/strong>I like that HubSpot AI is available at all points of the HubSpot customer platform. This means users get up-to-date information about their customer segments.<\/p>\n Source<\/a><\/em><\/p>\n The more information you can obtain about your customers, the better. Optimove is a multi-channel engagement platform providing a comprehensive overview of your clients from four sources.<\/p>\n The platform uses cluster analysis and algorithms to separate customers into similar groups. Once the initial groups are identified, Optimove takes it further and creates sub-segments based on behaviors, demographics, and real-time interactions.<\/p>\n What I like:<\/strong> The nice thing about Optimove is that once you\u2019ve segmented your audience, you can use control and test groups to A\/B test marketing campaigns.<\/p>\n Source<\/a><\/em><\/p>\n BlastPoint is an AI customer segmentation tool that provides optimized marketing solutions. It\u2019s designed to help you understand your customers at a household level, meaning you\u2019ll gain insights into their behaviors, demographics, and values.<\/p>\n The best part about BlastPoint is that, using its AI technology and your customer data, you can create as many filters as you need until you feel you have the appropriate customer segments.<\/p>\n What I like: <\/strong>I appreciate BlastPoint\u2019s mission to help you become a more customer-centric company, regardless of industry.<\/p>\n Source<\/a><\/em><\/p>\n When considering customer segmentation, you might think of grouping clients based on characteristics, like demographics. Heap thinks about customer segmentation differently. Instead of segmenting customers based on their characteristics, Heap\u2019s algorithm groups your audience based on their actions with your website.<\/p>\n Heap easily integrates with your existing technology, allowing you to create segments wherever your customers are. Heap also enables users to conduct A\/B testing, create personalized campaigns, and build targeted user guides based on customer segment data.<\/p>\n What I like<\/strong>: I like that Heap focuses on actions rather than characteristics. Knowing this information is useful for creating user guides and a better knowledge base.<\/p>\n <\/a> <\/p>\n Using AI for customer segmentation is an excellent way to identify the various customers on your accounts quickly. By understanding their actions and behaviors, you can boost conversions by providing relevant information and messages to your audiences.<\/p>\n If you plan to implement AI into your customer segmentation strategy, follow our experts\u2019 and our best practices.<\/p>\n You might choose to create a customer segmentation strategy for several reasons. For example, you might use it to redefine your marketing strategy or inform your business processes like Chuck Schaeffer, CEO of Johnny Grow<\/a>.<\/p>\n Schaeffer\u2019s team uses AI to dynamically map each customer into a customer segment. The segments can then be used to allocate resourcing and align business processes based on customer contribution.<\/p>\n For example, Schaeffer notes that the team may deliver high-touch customer support for high-contribution customers. Meanwhile, self-service support is available for low-contribution customers.<\/p>\n \u201cDefining business processes by customer type or segment is extremely effective in growing revenues and margins from high-contribution customers and lowering cost-to-serve for low or negative-margin customers,\u201d <\/em>Schaeffer says.<\/p>\n Schaeffer\u2019s team also uses AI to rank customer segments from most to least profitable.<\/p>\n \u201cIdentifying customers that contribute negative profits to the company creates an opportunity to plug those profit leaks. Reducing costs to serve these customers creates an alternative to discontinuing these customer relationships,\u201d<\/em> Schaeffer says.<\/p>\n AI tools work best when your data is clean, error-free, and accurate. In my experiment asking ChatGPT to segment my fitness clients, I realized more data would have provided me with better results.<\/p>\n If you have the data available, use it. You might be surprised at the information you learn about your customers and their behaviors and preferences.<\/p>\n Customer behavior will change throughout the customer journey. Collecting behavioral data when customers first interact with your company is best.<\/p>\n Ricardo Madan<\/a>, senior vice president of TEKsystems Global Services, notes that these interactions \u2014 from inquiries, issue resolution, bill pay, order reconciliation, and problem \u2014 can inform AI and ML predictive analytics tools.<\/p>\n These insights \u201cmake these experiences more seamless for the users and more efficient or profitable for the companies they’re working with,\u201d<\/em> Madan says. \u201cAll of this is optimized when the analytics effectively segment users earlier in the customer experience.\u201d<\/em><\/p>\n One of the main reasons you should create a customer segmentation strategy is to provide relevant information to your audiences. Once you understand them, use what you\u2019ve learned to your advantage.<\/p>\n![\"\u2192](\"https:\/\/no-cache.hubspot.com\/cta\/default\/53\/e83d6c8a-ba35-453b-b152-c92bbc81074a.png\")
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The Benefits of AI Segmentation<\/strong><\/h2>\n
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<\/a><\/p>\nDownload Free Customer Segmentation Templates Today<\/strong><\/a><\/h3>\n
1. Better Data Analysis<\/strong><\/h3>\n
2. Bigger ROI<\/strong><\/h3>\n
3. Improved Customer Retention<\/strong><\/h3>\n
4. Enhanced Predictions<\/strong><\/h3>\n
5. Saves Your Team Time<\/strong><\/h3>\n
Testing AI Segmentation<\/strong><\/h2>\n
The Scenario<\/strong><\/h3>\n
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Running the Experiment<\/strong><\/h3>\n
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<\/p>\nWhat I Learned<\/strong><\/h3>\n
Key Takeaways<\/strong><\/h3>\n
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AI Tools for Customer Segmentations<\/strong><\/h2>\n
1.<\/strong> HubSpot AI<\/a><\/strong><\/h3>\n
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<\/a><\/p>\n2.<\/strong> Optimove<\/a><\/strong><\/h3>\n
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<\/p>\n3.<\/strong> BlastPoint<\/a><\/strong><\/h3>\n
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<\/p>\n4.<\/strong> Heap<\/a><\/strong><\/h3>\n
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<\/p>\nAI Segmentation Best Practices<\/strong><\/h2>\n
1. Define your goals.<\/strong><\/h3>\n
2. Provide your AI tool with the most accurate data.<\/strong><\/h3>\n
3. Catch customer interactions early and often.<\/strong><\/h3>\n
4. Personalize, personalize, personalize!<\/strong><\/h3>\n
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