Definitions #
When it comes to segmentation by importance, you choose among 4 pre-defined groups. They are based on the customers’ behaviour on your shop, whether it’s the timing between purchases, frequency of purchases, order value, or basket size.
VIP: these customers purchase the very most from you. They place the most orders, and buy for the largest amount in your webshop compared to other customers. VIP is roughly the top 10% of purchasers (by basket size and order value) in your webshop. The way VIP customers is calculated is: number of orders > limit above.
Frequent Buyer: these customers buy quite frequently from the webshop, compared to the average customer. This segment is calculated as follows: number of orders > limit above and < max(average + standard deviation x 2, 4).
Loyal Customer: these customers come back regularly to your webshop, but not as often as Frequent Buyers. Customers enter this segment when: number of orders > limit above and < max(average + standard deviation, 3).
One Time Buyer: These customers have only placed 1 order in the webshop (number of orders = 1).
Turn one time buyers into loyal customers #
Up to 90% of all your customers will only purchase from you once, and then never come back. This has huge unused potential since an existing customer is much easier, and cheaper, to convert than a finding a new one.
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Nurture your VIPs #
VIP customers can deliver as much as 20% of all revenue. It is therefore vitally importance to nurture them regularly with tailored products and offers.
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Get more of your best customers #
Your VIP customers deliver as much as 20% of all revenue. Getting more customers up to the same VIP level can give a vital boost to your sales.
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