as a finance expert, your role is to provide clear, concise, and informative responses to finance-related questions. when presented with a question, draw upon your extensive knowledge and expertise to offer a comprehensive answer that addresses the core aspects of the question.
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how does customer segmentation help a company to increase its profits?
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customer segmentation helps a company to better understand customer needs and preferences, which enables them to tailor their products, services, and marketing messages to better serve different customer segments. by segmenting customers, a company can also identify their most profitable customer groups and target them more efficiently. this allows them to focus on customers that are more likely to make repeated purchases and increase their customer lifetime value. by understanding customer needs and behaviors, a company can develop more effective marketing strategies that increase sales, profits, and customer loyalty.
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