The comprehensive guide to B2C audience segmentation for marketing
Learn how to leverage customer data for personalized marketing that drives revenue
Summary
Why does audience segmentation matter?
Audience segmentation is the backbone of personalized marketing. It helps brands get the right message to the right customer at the right time, speed up time to purchase, efficiently exceed rising customer expectations, and stand out in competitive markets, making marketing campaigns more profitable.
With segmentation, you can use your customer data to create more meaningful interactions across all channels—and build stronger relationships over time
What is audience segmentation?
Audience segmentation is the process of dividing customers into smaller groups based on shared characteristics. This practice has evolved from simple demographic segmentation like age and income to real-time, dynamic segmentation that captures fleeting moments and keeps audiences engaged in a competitive attention economy.
According to Klaviyo’s future of consumer marketing report, 74% of consumers expect brands to provide personalized experiences, and 66% want brands to make them feel valued and understood. That’s where a strong segmentation strategy helps modern B2C brands stand out, by:
• Enabling personalized marketing at scale
• Optimizing lifecycle marketing across channels (email, SMS, push notifications, etc.)
• Improving customer experience and retention rates
• Improving marketing ROI by increasing the value of high-value segments
Types of audience segmentation
The best practice for gathering your customer data is zero-party data customers offer up voluntarily through collection methods like forms, surveys, and quizzes, and first-party data you observe on your owned properties, like website behavior and marketing engagement.
Once you have this information, you can set up:
Demographic Segmentation
Demographic segmentation divides audiences into groups based on age, gender, income, education, etc. Though a broad representation of your target consumers, it’s the foundation for your buyer personas and an audience segmentation strategy.
Examples of demographic segments include:
• Age
• Relationship status
• Income level
• Location
When luggage brand July used geographic segmentation to target local customers within a 20-kilometer radius of their retail locations in Melbourne, Sydney, and Brisbane with promotions for new products, the personalized approach contributed to 52% YoY growth in Klaviyo-attributed revenue.
Psychographic segmentation
Psychographic segmentation divides your audience into groups based on interests, beliefs, values, and lifestyles. Some examples include:
• Sustainability-conscious consumers
• Health-focused buyers
• Supporters of local businesses
While demographic segmentation identifies base traits, psychographic audience segmentation uncovers deeper preferences that shape consumer behavior.
Behavioral segmentation
Behavioral segmentation divides consumers based on the interactions they’ve had with your brand, such as past purchase history, product page visits, email and SMS engagement, types of products purchased, discount shopping, etc.
Here are some examples of behavioral segments:
• Highly engaged readers: Target subscribers who frequently open emails and interact with content with more in-depth content and exclusive updates.
• Click champions: Users with high click rates but low conversions may benefit from additional product information, testimonials, or limited-time offers to encourage purchases.
• Repeat customers: Customers who have purchased multiple times are primed for loyalty programs, exclusive deals, and product recommendations to encourage continued engagement.
• High-value customers: Big spenders warrant VIP treatment with priority support, early access to new products, and personalized incentives.
• At-risk customers: Customers who haven’t purchased in a while may need re-engagement campaigns, special promotions, or win-back messaging.
Recency, frequency, and monetary (RFM) value analysis is a method for identifying a brand’s most valuable customers based on their transaction history. This framework can help you identify customers across the spectrum, from loyal to at-risk, so you can tailor marketing strategies to each segment.
Harney & Sons, a luxury tea brand, used RFM analysis to refine their email marketing strategy. When they tailored outreach efforts to “At-risk” and “Needs attention” segments, one re-engagement campaign drove an average order value 21% higher than their overall AOV for ecommerce in 2024.
Predictive segmentation
Predictive segmentation uses customer data and AI to anticipate future behaviors, allowing brands to take a proactive approach to engagement rather than reacting after the fact. With predictive segmentation, you can anticipate customer needs, increase the relevance of your offers, and speed up time to first purchase and repeat purchase.
Here are some examples of how to use predictive analytics in your segmentation:
• Predicted customer lifetime value (CLV): Identify customers with high CLV and prioritize them with exclusive loyalty offers, VIP programs, or premium product recommendations.
• Anticipated next purchase: Determine when a customer is most likely to make a repeat purchase so you can send timely product recommendations or replenishment reminders.
• Churn risk analysis: Detect early signs of customer disengagement and implement win-back strategies before they lapse.
Apparel brand Jordan Craig uses analytics to gain insight into the ideal email cadence for each of the brand’s 40+ segments. Now, they send daily to customers for 2 weeks on either side of their AI-generated predicted date of next order—and see strong conversion from that.
Audience Suppression
You wouldn’t want to send your loyal VIP buyer a new customer discount email. Audience suppression helps you control who receives your marketing messages so you can target the right people and minimize marketing costs.
And, since ads are one of the most expensive B2C marketing channels, you can suppress engaged customers who are already clicking and converting through your owned channels to prevent unnecessary ad spend.
Types of audience suppression include:
• Automatic: For example, Klaviyo automatically suppresses profiles who have unsubscribed, hard-bounced, or marked emails as spam.
• Manual: You can manually suppress profiles you don’t want included in a segment.
• List-specific: You can configure list-specific unsubscribe settings, allowing users to unsubscribe from a specific list without being suppressed from all future emails.
• Segment-based: Use segment filters to dynamically suppress audiences based on specific criteria. For example: Loyalty program members → enrolled_in_loyalty = true, Recent purchasers → placed_order_at in last 7 days, Highly engaged customers → opened_email in last 30 days AND clicked_email in last 30 days
How to build your B2C customer segmentation strategy
Like other marketing and customer service strategies, segmentation involves goal setting, experimenting, and measuring results. Here’s how to build your strategy:
1. Set your business objectives and segmentation goals
To start, think about your goals. Looking to boost retention? Increase repeat purchases? Align segmentation with broader marketing objectives.
For example, segmenting by interests and location can drive personalization, while engagement-based segments can improve email and SMS deliverability.
2. Identify your data sources
Data is the foundation of effective segmentation. And your data should be flowing into a single source to create a holistic customer profile for every single customer. There, you should focus on collecting and using these data sources:
• Zero-party data like email addresses, phone numbers, and preferences gathered via surveys, quizzes, and forms
• First-party data collected through website behavior, purchase history, email engagement, and customer service interactions
Klaviyo B2C CRM consolidates data from all sources to create a comprehensive customer profile, unifying marketing, customer service, and analytics so you can personalize experiences across the entire customer lifecycle.
3. Build your segments in your B2C CRM
Start by focusing on key customer groups with easily accessible data, prioritizing behaviors that lead to quick sales. Use data to inform segments so you can tailor your messaging accordingly, like:
• Those who are most likely to make a purchase next based on browsing history
• Those who are most likely to churn and haven’t made a purchase in a while
• Recent shoppers who may be interested in a complementary item
Smart tools like Klaviyo’s visual segment builder can help you target more effectively with detailed data, logical filters, and time-based conditions. Klaviyo AI, meanwhile, can help you easily define new segments based on a sentence or phrase that describes what kind of group you’re trying to target, like “Customers who have started check-out or viewed a product but never placed an order.”
Seafood shop Svenfish uses Klaviyo’s Segments AI to group customers based on their last purchase date, purchase frequency, and proximity to their physical location. They can even build lists of customers who have previously been interested in whatever fish the shop caught that morning.
Thanks to strategies like these, Svenfish attributes 70% of their YTD ecommerce revenue to Klaviyo.
4. Launch targeted campaigns and automated flows
Segmentation is what empowers you to go beyond basic personalization. Deliver messaging, offers, and recommendations that feel hand-picked. Use automation to trigger relevant content, and adjust channels based on where each segment engages most (email, SMS, social media).
One way to do this is using hyper-personalization with data from quizzes, like a skincare quiz, to recommend products that will be most effective based on skin type or skin issues.
You can also consider using Jobs To Be Done (JTBD) theory to target customers and prospects—think about the problem that someone is trying to solve and help them find the right tools. For example, if the “job” your customer has is to be healthier and have more energy, an adaptogenic coffee alternative could help them accomplish this, and their motivations will guide your segmentation and messaging.
5. Validate your segments with testing
Check sample profiles to make sure they’re accurate, ensure your segments are large enough to be reliable, and experiment with A/B testing.
For example, are customers in your “recent purchasers” segment, in fact, recent purchasers? Spot check individual customer profiles and review their recent history to confirm that they’re in the right group.
Start with small test campaigns and use Klaviyo’s reporting and analytics to track performance, growth, and how customers move between segments.
6. Measure and optimize your segments
Regularly review your customer segments to keep your strategy sharp. Track key metrics like:
• Customer acquisition costs (CAC) by segment: If certain segments bring in high-value customers at a lower cost, that’s a strong sign of effective targeting. Segment engagement rates show how well your content resonates with different audiences. Higher engagement means you’re reaching the right people with the right message.
• Segment ROI and CLV: Are certain customer segments contributing more to revenue over time? If so, doubling down on those segments with more individualized offers could maximize your returns.
• Cross-selling rates and repeat purchase behavior: These may indicate opportunities to introduce complementary products.
Klaviyo offers several tools for analyzing segment performance, including:
• Segment growth report: Track how your segments are evolving.
• Audience performance report: Analyze engagement and campaign effectiveness.
• Conversion overview report: Attribute revenue to segmentation efforts.
• Campaign audience breakdown: See how segmentation impacts campaign performance.
By consistently measuring and adjusting your segmentation strategy, you can keep marketing efforts fresh, relevant, engaging, and profitable.
How to segment across channels
Most consumers are active across several channels, like mobile websites, brand apps, social media, email, and SMS when they’re shopping or in discovery mode.
When you take into account your customers’ preferred shopping methods, online browsing habits, and engagement with your ads, you can segment customers based on how they interact with your brand and better align messaging across all of these touchpoints.
And that’s key—according to our future of consumer marketing report, consumers’ top frustration when shopping across channels is inconsistent pricing and promotions.
Here are a few segmentation ideas by channel:
Get more ideas for email segmentation and SMS segmentation.
Audience segmentation best practices
To maximize the impact of your segmentation strategy, focus on data quality, customer feedback, and ongoing updates.
• Avoid over-segmentation. Too many micro-segments dilute impact and make automation difficult. Instead, focus on key behaviors and demographics.
• Prioritize data quality. Poor data leads to poor segmentation—“Garbage in, garbage out,” as they say. Regularly audit and clean your data to remove inactive subscribers and fix any errors.
• Update segments as customer behavior changes. Shoppers evolve—your segments should, too. Set automated rules to move customers between segments.
• Balance personalization with privacy. Collect explicit consent before gathering data. Offer clear opt-in choices for emails, SMS, and push notifications, and allow customers to easily manage preferences. Zero- and first-party data is permissions-based and therefore the most profitable kinds of data for brands who want to see genuine engagement.
• Build trust with personalization. Personalization should add value, not feel intrusive. Instead of constant promotions, try helpful product recommendations based on past purchases or abandoned cart reminders that highlight product benefits.
Connect with your ideal audience using Klaviyo B2C CRM
When customer data is coming at you from all directions, it can be tough to get a full picture of each customer. That’s why unifying your customer data in a single source of truth like Klaviyo B2C CRM is important—it empowers you to:
• Pull in data from marketing, customer service, and analytics. Klaviyo Data Platform, Klaviyo’s built-in CDP, pulls together everything from purchase history and browsing behavior to marketing engagement and reviews, giving you unified customer profiles. The better you understand your audience, the easier it is to sell to them.
• Create a 360-degree view of your customer. See how a customer engages with your brand when shopping with you over time, so you can identify important patterns—like that they prefer to shop with discounts, or make big purchases during Black Friday Cyber Monday.
• Use integrations to gain a single view of your customers. Bring in loyalty program data, build lookalike audiences and target VIPs via platforms like Meta, and meet customers where they’re most active.
• Prioritize tools that store data for your customer’s entire lifetime. Store data and make sure that customer data won’t expire unless customers request it. Customer habits and patterns evolve over time, and the fact that Klaviyo offers lifetime retention gives you a chance to see a first-time buyer turn into a loyal brand ambassador.
• Lean on AI to get a leg up on the competition. AI is only as good as the data it’s based on. When you divide your audience using Klaviyo’s predictive analytics, like predicted next order date or predicted CLV, you can deliver highly personalized experiences that are meaningful to each individual customer.
Klaviyo allows you to segment customers with any piece of data, from any source, across all time. Segments update in real time, so you’re always messaging the right audience. And Klaviyo AI helps you build smarter segments, faster—saving you time and driving results.