Value-based segmentation to prioritize high-value customers
Value-based segmentation categorizes customers based on their overall contribution to revenue, often using metrics like Customer Lifetime Value (CLTV) or average purchase size. To segment customers by value, businesses can analyze spending patterns, frequency of purchases, subscription tier, or the length of time a customer has stayed loyal to the brand. High-value customers are those who generate a significant portion of revenue or demonstrate long-term loyalty.
Once these high-value customers are identified, businesses can develop tailored retention strategies. For instance, offering personalized services, exclusive rewards, or VIP experiences can make these customers feel valued and help prevent churn. Additionally, businesses can prioritize outreach to high-value customers, ensuring they receive priority support and communication to reinforce their loyalty.
Starbucks' app demonstrates sophisticated value-based segmentation through its order history interface. By tracking detailed purchase patterns, including customizations and ordering methods (mobile vs. in-store), the platform enables quick reordering of favorite drinks while maintaining customer preferences. The "Previous" and "Favourites" tabs help frequent customers easily repeat their usual orders, encouraging loyalty through convenience.
Pro Tip! Use CLTV and purchasing behavior metrics to segment high-value customers and offer exclusive benefits that cater to their preferences.