The ultimate guide to customer segmentation for support teams

If you’re not using customer segmentation for support, you're missing out. Here's how to put segmentation to work for your support team.

By Molly Murphy

Published November 23, 2020
Last updated January 12, 2022

You see it in office lunch rooms, middle school dance floors and on social media: we, as humans, love belonging to groups.

A group is a collection of people with something in common—maybe a geographic location, a career, or a hobby. If you’re looking to resonate with all members of a group, the best approach is to work off of their commonalities.

The same theory goes for understanding customers: the best way to connect with them is to group them by shared characteristics.

This is especially important for support. Your customers are coming to you for help solving a problem, and they expect you to "get it." The better you understand your group, the better you can find solutions just for them.

The business term for sorting customers by shared traits is customer segmentation. It gives you all the info you need to provide a tailored support experience.

What is customer segmentation?

Customer segmentation is a way of grouping customers together based on their similarities.

“Segmentation is putting the customer base into meaningful buckets to differentiate support experiences,” says Benjamin Collet, Senior Director of Enterprise Global Advocacy for Zendesk.

There are a lot of ways you can segment your customers, depending on your team’s goals. You can organize by behavior, like buying habits, or by demographic, like age or location. No matter how you organize your customers, segmenting gives you a fast pass to solving their needs.

Why use customer segmentation for support?

Customer segmentation lets you personalize your support experiences so customers feel understood, which leads to increased satisfaction and engagement.

“Treating customers differently based on their needs is one of the most important ways to have a meaningful relationship that builds growth and loyalty,” Collet says.

You can offer hyper-relevant support

Different customer segments require different solutions.

“Imagine offering a small business customer the solutions you have available for enterprise customers,” Collet says. “It would be overwhelming to hear about creating your own integrations with developers you don’t have, and professional services you can’t afford.”

On the flip side, if your support were set up only for small businesses, it would cause big problems for enterprise customers.

“What if the only way to get help as an enterprise customer was through self-service? Time is ticking down for your deadlines, and you have production-impacting needs demanding urgent and customized subject-matter expertise,” Collet says.

Segmentation fixes that. Grouping your customers by how complex their businesses are gives the agent a guideline to follow when offering support solutions. If it’s a small business, the agent will focus on quick, simple solutions the caller can handle on their own. If it’s a large enterprise, the agent will be prepared to escalate the support request for a faster, more thorough fix.

Agents can provide a faster experience

Segmentation streamlines the support experience, so agents can provide answers faster.

When a segmented customer makes contact, the agent already has information to start helping. The support platform can take details from the customer’s initial query and compare it with issues seen by other customers in this segment to give the agent solutions from similar issues. Not having to look up customer info to understand the customer’s problem saves agents valuable time.

Knowing what to expect also helps with connecting the customer to the right agent the first time.

“It’s the worst customer experience to be told, ‘Oh, sorry, for that question I need to get you to another team,’” Collet says.

Zendesk minimizes multiple connections by lining up agents with customers based on their segment traits. Agents focused on one product line or customer group are familiar with most common issues. That expertise means they can answer customers’ questions faster and more thoroughly.

Customer segmentation example: Answering similar questions

Most small businesses have similar questions when getting started with a new product. Agents who specialize in small-business onboarding issues are likely to see the same questions come up time and again. If the agent were a generalist, they may still have to pull from resources to get the customer a solution. But reps that focus just on small businesses in the early-stage life-cycle segment will have answered the same question many times and can get to the solution faster than a generalist could.

“By leveraging customer segmentation, we were able to shape more narrow bandwidth engagements that led to positive agent and customer outcomes," Collet says.

Segmentation metrics help you see underlying issues

Customer segmentation analytics help you investigate broad performance trends and determine the unique problems facing different customer groups.

Customer segmentation example: Filtering by metric

You’re noticing a drop in customer satisfaction scores. You filter the metric by life-cycle stage and can see that customer satisfaction rates are especially low with long-term customers. From there, you can brainstorm retention strategies.

You can also compare your segments to make sure that the issue you’re investigating doesn’t cross groups. What if customer satisfaction is low across all life-cycle stages? That tells you it’s likely that there are fundamental issues at play rather than segment-specific problems driving the trend.

3 types of customer segmentation

Customer segmentation is not something you can do in a one-size-fits-all way.

“There’s not a universal segmentation prescription that is equally meaningful for all businesses,” Collet says. “You have to look at the data and see what segmentation model makes sense for customers, agents, and the business.”

Not sure how to organize your customers? Many businesses sort their base by demographic, value, or life-cycle stage.

By demographic

Demographic segmentation means splitting customers by gender, age, income, education, or geographic location.

Marketing teams often use demographic segmentation. They'll personalize their messaging for a particular age group or to resonate with a certain region.

Demographic segmentation can also make sense for support teams.

Age segmentation can give your agents a heads-up on communication preferences. Younger customers will likely prefer chat or social media support, while older generations will appreciate an email or a phone call.

Age segmentation can also give your reps a hint on tone when communicating. If you're working with a Gen Z customer on social media, break out the emojis. If you're handling a baby boomer over email, you'll get further with full sentences and a respectful tone.

Customer segmentation example: Segmenting for unique times

In times of natural disaster, you might decide to segment by region to offer specialized support. With this segmentation, agents are able to quickly reach out to affected groups and provide extra help if needed.

By value or cost

Segment customers based on the economic value they provide to your business. This helps you allocate support resources where they’re most needed.

If a customer isn’t generating a lot of revenue, you may want to rethink the level of support you’re offering them.

“Let’s say a small business is calling your support team two or three times a month,” Collet says. “Maybe you know the cost per unit for a phone call is $45. And those small businesses only pay $15 for the product. You might want to take a closer look at phones as an unlimited channel for that customer segment.”

Collet warns that the best approach isn't necessarily cutting down on those services. Instead, try to find cost-saving alternatives.

Using these alternative solutions for lower-revenue-generating customers empowers your agents to help higher-value enterprise customers more. These customers are far more likely to have complicated support issues that a forum or bot can’t solve.

Customer segmentation example: Decluttering your phone queue

Look at the questions commonly asked on phone calls, and see whether there's a way of answering them off the phone. You may find that you can make a product improvement that makes the question unnecessary or offer the answer in a FAQs page or community forum.

By life-cycle stage

Segmenting by life-cycle stage is grouping customers by where they’re at in their customer journey. This segmentation highlights how customers’ support needs change as they move through the process.

“Instead of having basic questions on how to use your product, veteran users’ questions will become about how to maximize the product’s efficiency. As their business grows in complexity over time, their support needs are likely to grow in complexity as well,” Collet says.

Customers expect their support team to evolve with them to meet their changing business needs. It’s especially important with long-term B2B customers. These businesses are likely to continue to grow in complexity, and B2B customers rely heavily on support to help their businesses continue to expand.

“As a customer, as my business succeeds and my needs grow in complexity and urgency, Zendesk support treatments grow with me,” Collet says. “This is an important element of trust—that across my life cycle as a customer, I will always have a partner who is in lockstep with me.”

Customer segmentation example: Customers in onboarding

Customers often need a lot of support during the onboarding process. In this stage, they’re getting used to using your product and likely experience issues on a regular basis. As they transition out of onboarding into retention, their support needs will change.

Steps to building a customer segmentation strategy

Your customer segmentation strategy is your road map to how and why you’re organizing your customers the way you are. Your strategy should give you clarity on why you're using segmentation and which model you're choosing.

Step 1: know your goals in advance

Before you start organizing your customer groups, think about how your segmentation is serving the bigger picture—your business and your customers.

Start with identifying your company-wide goals. Reviewing these objectives will help you figure out which segments best complement the company’s larger customer experience strategy.

“If the company strategy is to focus on cost efficiency, it may make sense to focus a segment on self-service and bot-powered experiences,” Collet says.

Consider your customers’ goals. Maybe customers report that onboarding takes too long. You might use segmentation to allocate more agents to early-stage customers.

"Asking, ‘How can I best divide up segments to maximize quality of support in alignment with customer needs?’ is a primary way of creating a segmentation strategy," Collet says.

Step 2: Determine the best way to segment your customers

With these goals in mind, you need to decide which model of segmentation makes the most sense for your customer groups.

Start with segments that already exist in your company. If other departments are using customer segmentation, try out their models first. If all the teams in your business are segmenting the same way, you’ll have a common framework for discussing customer needs.

“If your sales team or success team is using a segment strategy, try on those definitions for yourself,” Collet advises. “You might be surprised at how meaningful they are to you. It may power up your partnerships with those teams so you can build support treatments in concert.”

If other team segments don’t work for support, create your own support-specific segments that closely align with your goals.

Say your support team isn’t scaling solutions well based on customer business size. Try segmenting by company size to offer more tailored treatment.

Or maybe you have a customer base that differs a lot in age. Segmenting by demographic would let you relate to each age group in the way they prefer. And having a unique contact strategy for each age demographic should improve your customer satisfaction ratings.

Step 3: Revisit your strategy regularly and adjust your service as needed

Be prepared to make changes in your segmentation strategy if what you’re doing isn’t working.

The whole point of segmentation is to relate in a personalized way to your customers. Providing a tailored experience should streamline your problem-solving process and increase customer satisfaction. The goal should be agents who understand your customers better and are able to reach solutions faster. If this isn’t happening, you’ve probably segmented your customers by the wrong factors.

Don’t expect to choose the right segments the first time around. It might take some time to find the right groupings; don’t give up.

Customer segmentation example: Satisfaction scores aren’t improving

If satisfaction scores aren’t improving for a particular segment after personalizing your approach, you might have to change your methods. Maybe you chose the wrong solution, like deciding an older age segment would love to connect with you on social media.

Be prepared to tweak the personalized experience you develop for each segment until you find something that resonates with your customer base.

Pick the right software to make customer segmentation effortless

Conducting customer segmentation is a whole lot easier when you have analytics software built for the job.

Zendesk Explore enables you to filter customers by a wide range of factors and drill down on the customer segments that are the most important to your business.

If you’re ready to check out how Zendesk can work for you, start a free trial today.

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