Customer segmentation To achieve this, the first task was to segment its customers into actionable segments with distinct needs. DHL defined three main segments. First, strategic customers are extremely high-volume shippers with a full range of logistics solutions and express-shipment needs. This segment consists of approximately of DHLs top 250 customers worldwide, which are mostly large multinationals. Second, the relationship customers segment consists of customers who use DHL to ship their products and documents regularly, but with a lower volume than the strategic customers segment and also not as sophisticated supply-chain needs. Finally, the direct customers segment ships infrequently with DHL. The customer segmentation can be represented in the form of the familiar customer pyramid in Figure 1. These segments are further divided into subsegments based on the kind of service required (Figure 2). The needs of direct customers and many of the relationship customers often are fully met by DHLs basic products. For relationship customers with special needs, DHL also offers some special programs like direct distribution to its partners, test services and parts distribution to fulfill these needs. Strategic customers virtually always use customized solutions, like providing bulk-breaking facilities and planned production support for precision delivery schedules, and DHL aims to meet their entire express delivery needs. Customers using DHLs basic products find it easier to switch as switching costs are low and all key competitors also offer similar products. In contrast, the switching costs are significantly higher for customers with special programs, and highest for clients using customized solutions. 1. What do you see as the main challenges in implementing this segmentation in DHLs customer database? 2. How would you recommend DHL to address those challenges?3. What are the various possible practical applications of this segmentation methodology byother functional department (e.g. sales, customer service, etc.)?