Decor Image

Personalization Glossary

A/B testing? Recommendation models? The personalization engine space uses several acronyms that may seem daunting, so we're here to help. You can find definitions to the most common e-commerce customer experience optimization terms here!

Glossary Banner

Micro Segmentation

The process of dividing incoming website traffic into numerous small groups of visitors who share commonalities and patterns. While traditional data-points allow for high-level technical, demographic, or geographic segmentation, micro-segmentation incorporates a vastly wider range of data-points, made available due to recent technological breakthroughs.

Micro-Segmentation

Micro-segmentation is a marketing technique that uses knowledge to classify people’s interests and to influence their perception or behaviour. We have all the data that we need to answer our client’s questions in the ideal world. However the ideal is not always our reality, so we need to find new approaches to meet the needs of the consumer. Micro-segmentation encourages customers to be grouped into more targeted, oriented markets within the segmentation and market of the customer—enhancing specificity and, amid limited customer data, creating a micro-segmentation marketing strategy. 

Here seem to be the best things to just get going on a marketing strategy for micro-segmentation:

Describe the basic audiences: 

You’re going to have to split up the customers into classes first. You might start with the segmentation of your client that can be described by demographics. But then you can also set base groups on the following characteristics: 

  • Demographics: age, gender, education, income, children, ethnicity, marital status 
  • Geography: Country, area, population growth, population density
  • Psychographic: lifestyle, beliefs, social classes, personality
  • Behavioral: use, commitment, awareness, affection, buying habits, price sensitivity 

Classify strongly encoding parameters for each base group: Next you can obtain in-depth, deeply indexing attributes for each base audience. Strongly indexing variables can be defined by audience analysis within your chosen DMP or other data platform. These strongly indexing variables allow a more holistic understanding of each target audience and their possible subsets, so that you would define the distinctive features and convert these subsets into micro-segments. 

Develop micro-segments: upon analysing strongly indexing characteristics, pool them collectively (mainly psychographic and behavioural) to identify micro-segments. In order to obtain optimum coverage, you should build at least 3 or 4 micro-segments for each base audience. 

For example, people without kids will thoroughly enjoy qualities related to high travel and shopping, clean lifestyle, civic pride, and cultural arts and culture to the development of the following micro-segments. 

  • Upscale Tourists & Buyers: consumers interested in elevated goods and travel amenities with high discretionary travel and shopping budgets. 
  • Good Living: buyers interested in good and sustainable living as well as wellness and fitness (including advertisements and articles on these subjects)
  • Cultural Fanatics: Consumers involved in performing arts and entertainment

Difference between the micro and macro segmentation

While there are many strategies for segmentation, two of the most prominent stick out, micro and macro segmentation. The distinction between the 2 market segmentation resides in the level of specificity each required. Whereas macro segmentation emphasizes high-level customer data such as location, language or source, micro-segmentation consists of specific customer data such as preferred products, brand history and duration since the last transaction.

Navigate between the letters, to explore the glossary terms

Decor Image
ImgObj

Find out what Vue.ai
can do for you.

To get started, fill out the form.
Our experts will get back to you shortly.

I understand that Vue.ai® may reach out to me with relevant communication.
By clicking ‘Request a Demo’, you agree to our Privacy Policy.