Ways to Use Customer Segmentation to Recover from COVID-19

Customer segmentation provides a means to overcome some of the obstacles presented by the onset of this crisis. Here we show you ways to use customer segmentation to recover from COVID-19.

This year the world was hit by COVID-19, plunging it into lockdown and a deep health and economic crisis. As Scott Morrison, Prime Minster of Australia said the country had to focus on “saving lives and saving livelihoods”.  So how can you go about saving your livelihood and business?

Unsurprisingly, consumer behavior also accordingly saw a massive shift. With people showcasing a much more conservative buying behavior, many companies are struggling to remain afloat in these uncertain times. Customer segmentation provides a means to overcome some of the obstacles presented by the drastically changed landscape. This article will seek to explain ways to use customer segmentation to recover from the crisis-induced by COVID-19.

1. Segmenting Along the Concern Continuum

Traditional forms of segmentation such as demography, age, or gender aren’t as effective as segmenting along the concern continuum. The impact of the COVID-19 crisis has not been felt uniformly across the board, with some suffering more than others. Utilizing customer insights, marketers can segment customers into four distinct personas as detailed below:

  • Slam-on-the-Brakes
    Highly conservative spending behavior with emphasis on lower-cost products and postponing of what are considered non-essential.
  • Pained-but-Patient
    Conservative spending behavior but some purchase of non-essential allowable. Will showcase brand loyalty if experience remains positive.
  • Comfortably Well-Off
    Spending behavior largely unaffected apart from greater selectivity when it comes to luxury items.
  • Live-for-Today
    Spending behavior remaining largely unchanged from the pre-crisis state.

Finding which segment a particular customer belongs in can be helpful in targeting the right message to them. For instance, in regards to the Slam-on-the-brake segment, you can pre-empt a switch to another lower-priced brand by offering an exclusive discount. With live-for-today, you can keep using your existing marketing strategy to keep them engaged.

2. Priority Segmentation

Another way to optimize returns from marketing is to conduct priority segmentation. With revenues already declining, your marketing budget is likely to be cut, necessitating the need to get more done with less. Consider the revenue or frequency of engagement of customers and segment them accordingly, targeting the majority of your marketing efforts on those that bring the most value to your business. In difficult economic times, investing your marketing efforts on low-customers is unlikely to yield any meaningful returns.

3. Identify Niche Market Opportunities

A crisis can be disruptive but also opens up new avenues of opportunity. Any large-scale change in the economic environment can either open up new or expand existing niches for a savvy marketer to exploit. Identify newly emerging industry and how your business can provide value in regards to it. Segment your message according to these target markets and gain a first-mover advantage, with returns likely to grow further as consumer confidence increases again.


The impacts on the health and livelihoods has impacted of citizens of countries across the world. We have had to adapt to restrictions being place on how we go about business.  Customers and prospects are still out their and we need to maximise the effectiveness of our marketing. This article looked at the ways to use customer segmentation to market and sell effectively.

The HBR article, How to Market in a Downturn, highlight new ways to look by which we can segment the market. In addition we look at priority segments and also look at niche market opportunities.  Look at how the new segments shown in the HBR article may be relevant to you business.

Customer Relationship Management (CRM) systems like Nimble make it easy to segment and communicate to your prospects, customers and contacts.  Implementing a CRM will enable you to establish a “single source of truth” about customers and prospects which improves the customer experience. If you’re looking for tips on implementing a CRM check out this article.

How has your marketing strategies shifted in response to the COVID-19 crisis? Have any opinions on this article that you would like to share? Do tell us about it in the comments below. Don’t forget to share this article with others in your circle who may also find this a worthwhile read.

If you would like to chat about how to make your business’ customer segmentation click here to arrange a time with our specialist.

Thanks for stopping by and have a fantastic day.



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