Online purchaser segmentation and promotion strategy selection: evidence from Chinese E-commerce market

Online customer segmentation is a significant research topic of customer relationship management. Previous literatures mainly studied the differences between non-purchasers and purchasers, lacking further segmentation of online purchasers. There is still existing significant heterogeneity within purchaser-groups. This paper focuses on Chinese online purchaser segmentation based on large volume of real transaction data on Taobao.com, we firstly extracted and investigated Chinese online purchaser behavior indicators and classified them into six types by cluster analysis, these six categories are: economical purchasers, active-star purchasers, direct purchasers, high-loyalty purchasers, risk-averse purchasers and credibility-first purchasers; then we built an empirical model to estimate the sensitivity of each type of online purchasers to three mainstream promotion strategies (discount, advertising and word-of-mouth), and found that economical purchasers are the most sensitive to discount promotion; direct purchasers are the most sensitive to advertising promotion; active-star purchasers are the most sensitive to word-of-mouth promotion; finally, the implications of online purchaser classification for marketing strategies were discussed.