What is segmentation in SAP CRM-MKT - Marketing?

SAP Term: segmentation

• Component: CRM-MKT

• Component Name: Marketing

• Description: Process of either separating your customer base into homogenous groups or dynamically grouping your products, both by combining certain selection criteria, thus enabling you to address the resulting target groups with an individually targeted marketing mix.

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• Key Concepts: 
  Segmentation is a process used in CRM-MKT Marketing to divide customers into groups based on shared characteristics. This allows businesses to better understand their customer base and tailor their marketing strategies to meet the needs of each segment. Segmentation can be based on demographic, geographic, psychographic, and behavioral criteria. 
  
  How to use it: 
  To use segmentation in CRM-MKT Marketing, businesses must first identify the criteria they want to use for segmentation. This could include age, gender, location, interests, or purchase history. Once the criteria have been identified, businesses can then create segments based on these criteria. Finally, businesses can use the segments to create targeted marketing campaigns that are tailored to each segment’s needs. 
  
  Tips & Tricks: 
  When creating segments, it is important to ensure that each segment is distinct and has enough customers to make it worthwhile. Additionally, it is important to regularly review and update the segments as customer needs and preferences change over time. 
  
  Related Information: 
  Segmentation is a key component of CRM-MKT Marketing and can be used in conjunction with other marketing strategies such as personalization and automation. Additionally, segmentation can be used in other areas such as customer service and product development.