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Customer Segmentation: Activity

This is part 4 of a 5 part series on Customer Segmentation.

Staying Active

One of the most challenging parts of building a product or service is that different customers will use it in different ways. Some may use it everyday, while others may only use it once a month. It is dangerous to assume that customers who use it more often are happier, as frequent use might indicate problems and frustration!

Often, different activity patterns represent different use cases for your product. In a single company, a salesperson might use Salesforce everyday while the head of sales only logs in to check reports once a month. Both users are getting a lot of value but in very different ways with different activity patterns.

There are some obvious activity groupings you can use:

  • Daily Users – use the product everyday.
  • Weekly Users – use the product at least once a week.
  • Monthly Users – use the product only a few times a month.

This segmentation should reveal some interesting differences in customer behavior! Just like with our study of Happy Customers last week, you should be able to identify what makes Daily Users come back everyday while Monthly Users come back so infrequently.

It’s possible that some of the most interesting activity segments don’t align with the calendar. One product I worked with had a very interesting segment of customers that were only active on Tuesdays, which revealed an interesting use case for the product. You should spend some time reviewing the activity data for your customers before choosing your activity segments.

Activity segmentation can be very challenging as customer activity patterns are prone to changing often and without warning. For example, a Daily User might suddenly become a Monthly User if they get promoted or their company starts to use some different tools. But it could also be an early warning that users are not interested in your product if the rate of change between Daily and Weekly / Monthly is too fast. You will need to continuously re-segment your customers into activity buckets if you want to have accurate insights.

Quote of the Day: “I have always thought the actions of men the best interpreters of their thoughts.” – John Locke

The Customer Segmentation series