What Are Customer Tags? Why Are They So Important?
Customer Tags are labels attached to each customer to categorize and understand their spending habits, preferences, and behavioral patterns. This enables you to conduct targeted marketing campaigns for different customer groups.
Many SME owners face this problem: every time they run a promotion, they send the same message to all customers, thinking this will work as marketing. But this "blind marketing" approach usually yields very poor results:
- Customers interested in the product may feel the message is insufficient
- Customers not interested in the product may feel it's harassment
- Open rate becomes increasingly lower
- Even some customers may block your messages
If you learn to use Customer Tags, you can avoid this problem and achieve real "targeted marketing."
Main Types of Customer Tags
Consumption Behavior Tags – These tags are based on customers' spending behavior
- High spender – Single transaction over HK$1,500
- Medium spender – Single transaction HK$500 – 1,500
- Low spender – Single transaction under HK$500
- Frequent customer – More than 3 transactions per month
- Occasional customer – Less than 1 transaction per month
- Dormant member – No consumption for over 90 days
Consumption Preference Tags – These tags show customers' consumption preferences
- Beauty enthusiast – Regularly buys facials, skincare treatments
- Hair enthusiast – Regular haircuts, hair dyeing
- Price-sensitive – Always asks if there are any discounts
- Product buyer – Regularly buys hair care, skincare products
- Service lover – Prefers personalized human service
Customer Attribute Tags – These tags are about customers' personal attributes
- Female / Male – Gender
- 25-35 years old / 35-45 years old – Age group
- Causeway Bay / Mong Kok / Sha Tin – Residential area
- Office worker / Housewife / Student – Occupation
- Sensitive skin / Dry skin / Oily skin – Skin/hair characteristics
Custom Tags – Besides system tags, your staff can also manually add custom tags to customers
- Special needs (e.g., pregnant, postpartum)
- Service preferences (e.g., prefers a particular staff member)
- Behavioral habits (e.g., prefers visiting on Saturdays)
- Health condition (e.g., allergy-prone)
Practical Applications of Targeted Marketing
Application 1: Birthday Offer
Blind approach – Send the same "Happy Birthday! HK$100 coupon" message to all members
Targeted approach:
- Filter "Upcoming birthday members"
- Send different offers based on customer's age group:
Effect:
- Open rate increased by 3 times
- Usage rate increased by 2 times
Application 2: Re-engaging Dormant Members
Blind approach – Send "We miss you" messages to all members
Targeted approach:
- Filter "Dormant members with no consumption for 90+ days"
- Based on their previous purchases, send relevant offers:
Effect:
- Reactivation rate increased by 40%
- 3 times more effective than sending blind messages
Application 3: New Service Promotion
Blind approach – Send Botox treatment promotion to all members
Targeted approach:
- Filter "High spenders + Beauty enthusiasts + Customers who have done treatments before but haven't tried Botox"
- Send targeted promotional message to this specific group
Effect:
- Conversion rate increased by 5 times
- Avoid disturbing unsuitable customers
Effectiveness Data of Targeted Marketing
According to our client data, the effectiveness difference between targeted marketing and blind marketing can be significant:
Blind Promotion:
- Send count: 1,000 people
- Open rate: 15%
- Conversion rate: 1%
- Total revenue: HK$1,000
Targeted Promotion:
- Send count: 200 people
- Open rate: 45%
- Conversion rate: 8%
- Total revenue: HK$16,000
Summary :
Targeted marketing's conversion rate is 8 times higher than blind marketing; even with 5 times fewer messages sent, revenue is actually 16 times higher!
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