Understanding the segments - in detail
Because it is based on BEHAVIOUR, the segmentation model is dynamic, reflecting customers interaction with your organisation and the changing nature of that relationship.
Understanding the qualities and behaviours of each segment will inform how and when you communicate with customers in order to manage their journey through the model.
Not a Customer
As a customer starts on their journey with your organisation, they are considered 'NOT A CUSTOMER'. This refers to their status BEFORE their first interaction. They are new to your database with no ticketing history.
Attracting new people to your database is vital to maintain a balance of customers in your pipeline as others will inevitably fall out of the journey pyramid for a range of reasons such as changes to their lifestyle and life stage.
First Timers
This group probably accounts for approximately 60% of your ticketing database. As a sector, we are great at attracting first time attenders but less good at converting those customers into Convertees or Actives.
Typically, only 1 in 10 customers makes a second booking making the marketing cost of acquiring that customer pretty high. A worthwhile strategy to implement is to focus on getting your first timers to make a return visit. Customers who make a second visit are 9 times more likely to make another.
Convertees
This segment have made the all-important second visit within the last 18 months and, consequently, are even more likely to come back.
Convertees are 35% more likely to make another booking
Actives
These are your regular attenders. While their value per transaction might not be as high as First Timers, they are the bread and butter of your organisation. They know what they like and what they want from you. They are to be cherished and rewarded for their loyalty. They are prime targets for developing into VIP's.
Actives are 50-60% more likely to make another booking
VIPs
This segment will mean different things to different organisations. You may run a Membership, Friends or Subscriber scheme and wish to code those as your VIP's or you might want to base this segment upon number of visits in the time period or value of the relationship to your organisation. However you decide to cut it, these are your most important customers and require different treatment from your other segments.
VIP's are 80% more likely to make a further booking
Stale
Each organisation will have it's own stale period - we have seen them range from 12 to 36 months - but sector benchmark is 18 months. Understanding yours is important to being able to effectively manage your customer relationships.
Customers in this group are not beyond reactivation but will require a targeted approach.
Stale customers are 2% more likely to re-attend
Lapse
In our analysis, we have identified a further category where the chances of re-activation are so slim it is not a valuable use of your marketing resources to try and re-engage these people. Unlike stale, where there is some hope, Lapse in the P7 world of data driven marketing, is unlikely to be a viable segment as the cost will be high and the rewards, slim.
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