Knowing Your Customers Using Customer Segmentation

Abstract

This paper presents a customer segmentation review study to know more about the customer, and every successful business starts with knowing its customers. Trying to understand the customers on all levels is essential for companies. The main objective in customer segmentation is to understand their straight requirements, and business is to transform themselves into a crucial business segment to satisfy all their needs. It is vital to retain present customers and attract new ones in this viable market; understanding the customer is very important from this perspective. Different organizations are using the customer segmentation method, analyzing the value of the customer and providing them with better service according to customer need. This review studies the customer segmentation models and the most popular model recency, frequency, and monetary (RFM) to segment customers according to business needs, and segmenting customers according to profitability and seniority defines the customer journey. Also, highlighted are the different types of customer segmentation, customer segmentation models, and customer segmentation applications, which provide great insight into customer segmentation.