# What is Customer Segmentation?

What is Customer Segmentation? Dividing the customer base into groups with shared traits: demographic, behavioral, geographic, psychographic.

## How it works in practice

Segmentation is the difference between broadcasting and having a conversation. A newsletter sent to everyone the same way averages 2% CR. An email to a specific segment ('customers who bought coffee in the last 3 months') gets 8-12% CR. Same work, 4-6x the results.

## Related metrics

- RFM Analysis — the basis for behavioral segmentation
- Personalization — segmentation enables personalization
- Email Marketing — segmentation raises open rate and CR
- CDP — enables advanced segmentation

## Common misconception

'Segmentation is complicated.' Basic segmentation takes 5 minutes in Klaviyo: 'bought / didn't buy,' 'spent over $140,' 'opened an email in the last month.' Four basic segments already change results.

## How to fix it

Segmentation not working? (1) Check data quality — is customer data complete and accurate? (2) Check segment size — a segment under 100 customers isn't enough to test, (3) Check relevance — is the message accurate for the segment? (4) A/B test different messages per segment.

## Real-world example

Sports store: one newsletter for everyone — CR 1.4%. Segmented into: running, fitness, yoga, swimming. Specific messaging per segment. Average CR: 4.8%. Same list, same send volume, 3.4x the revenue.

## Where to start

Minimal weekly segmentation: (1) VIP customers (3+ purchases), (2) active (purchased in the last 90 days), (3) dormant (no purchase in 90-180 days), (4) new (joined in the last 30 days). Four segments → four messages.

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Category: Marketing · From the [Jimmy OS KPI Glossary](https://jimmy-os.com/glossary/kpi.md) · Source page: https://jimmy-os.com/glossary/kpi/customer-segmentation