What is customer segmentation?
Customer segmentation is the process of dividing your customers into groups based on various characteristics, such as age, location, lifestyle, personal preferences, and more.
This powerful practice lets B2C brands unlock personalization at scale—whether that’s tailoring messages to specific groups, offering product recommendations based on past purchases, or tapping into behavioral data to identify optimal send times.
It’s segmentation that delivers on marketing’s goal to send the right message, to the right person, at the right time.
Why is customer segmentation important?
Even though customer segmentation happens behind the scenes, taking this extra step drives highly visible, revenue-generating outcomes for B2C brands—here’s why:
Customers expect personalization
Klaviyo’s 2025 future of consumer marketing report found that 74% of consumers expect brands to provide personalized experiences.
This expectation makes sense. You wouldn’t expect the same message to resonate as well with customers who, for example, purchased from your brand more than 3 times and always buy a specific type of product, compared to customers who only purchased from your brand once and left a 3-star review or lower.
By segmenting across different characteristics, you can fine-tune your messaging and give customers the individualized experiences they crave.
Targeted campaigns lead to more revenue
Customer segmentation is the key to creating more relevant marketing campaigns that reach the right audience.
This is significant because Klaviyo’s 2025 benchmark report found that campaign order rates are more than 5x higher for the top 10% of campaigns across both email and SMS. The repeat purchase rate (RPR) is even higher—7x the average.
These top performing campaigns have one stark difference to all others: they’re highly segmented, more relevant to their audience, and stand out more prominently in inboxes—all factors that lead to improved clicks and conversion rates.
In other words, the more targeted your campaign, the higher the potential impact on revenue.
Automated flows become more powerful
Many marketers focus their efforts on one-time email and SMS campaigns, which can drive plenty of purchases—especially if paired with thoughtful segmentation.
But if you want to drive revenue while you sleep, automated flows are the way to go. Whether it’s an abandoned cart reminder or a post-purchase email, the benchmark report found that these flows generate up to 30x more RPR than campaigns because they’re so timely and targeted.
By pairing segmentation with marketing automation, you can craft a more strategic, impactful customer journey that nurtures at every touchpoint. For instance, you can craft personalized automated flows based on both real-time behavioral data (like an abandoned cart) and historic behavioral data (like multiple purchases, customer service inquiries, or browsing history) to completely customize the message.
Customer lifetime value (CLV) increases
Fast-growing brands today focus on customer experience––and segmentation is a powerful tool to make that happen.
Creating a personalized experience for every customer in every single message you send is a real possibility––and you don’t need extra internal headcount or tools to make it happen. Moreover, when you build those personalized experiences, you speed up a customer’s first and second time to purchase, ultimately increasing CLV.
The 4 types of customer segmentation
Here are the most common ways to segment your customers:
1. Demographic segmentation
Demographic segmentation typically includes factors like age, gender, income, education, religion, ethnicity, job title, and marital status.
For example, a makeup and cosmetics brand might segment customers by age and send different personalized product recommendations to customers who are in their 20s from customers who are in their 50s.
2. Geographic segmentation
Geographic segmentation involves dividing your customers by their location—including country, region, state, city, or even neighborhood.
This type of segmentation can serve many purposes. For example, My Community Made, an online marketplace for handcrafted goods, uses Klaviyo to segment their email list by billing state, which lets them email shoppers about craft fairs in their area.
You can also tailor messages to different climates. A clothing brand, for instance, might advertise heavier winter gear to states in cold climates versus a place like Florida—or pause their marketing efforts entirely if a region is experiencing a natural disaster.
3. Psychographic segmentation
Psychographic segmentation goes a bit deeper and separates customers based on traits like their values, interests, attitudes, personality, and lifestyle.
Let’s say you run a sporting goods store and ask new customers to complete a short quiz on your website. With that data, you can segment them based on their favorite sport or activity level.
This segmentation can then shape your marketing strategy—whether it’s recommending your bestselling rock climbing gear to avid climbers or increasing outreach cadence to your most active customers.
4. Behavioral segmentation
Finally, there’s behavioral segmentation, which groups customers based on their interactions with your brand.
This includes how frequently they visit your website (and what they browse when they do), how often they purchase from you, and whether they subscribe to your newsletter. It also includes more granular behavior like clicks, page views, media plays, and likes.
Shinola, a handcrafted watch brand, uses Klaviyo to segment their customers by their behaviors. For instance, they surface product categories based on customers’ past purchases. They also highlight outlet offerings to disengaged subscribers who usually shop sales.
Find the right platform for B2C customer segmentation
Personalization at scale requires customer segmentation, which is only possible with the right platform in place.
Klaviyo is the only CRM built for B2C. It uses advanced segmentation, deep personalization, AI-driven automation, and more to help take your marketing strategies to the next level.
Sign up for Klaviyo today or schedule a demo to see how we can help your business grow.