In a sea of never-ending marketing practices, newly introduced technology, and the expectations that are now placed on marketing departments, the idea of change is seemingly always on the agenda. Or is it? It still seems like old and out-of-date practices are still in full swing, yet simultaneously failing at an exponential rate—all due to our world’s new data-driven economy.

Lately, the best example seems to be how people throw around the term and practice of “segmentation.” First, let’s define it so we are all on the same page. Simply put, it refers to “The activity of dividing a broad consumer or business market, normally consisting of existing and potential customers, into sub-groups of consumers (known as segments) based on some type of shared characteristics.” And as caveat, let’s not confuse a marketing term with a data base term such as data segmentation—that’s a different beast entirely.

Okay, so there you have it. Now that we have defined it, let’s be clear that segmentation is also very, very … need I say it again … VERY dead. The idea that people can still be represented as a semi-generic sub-group is at best laughable. One need only revisit our countless Retail Fail Reports (Click Here to Read our Retail Fails) to see just how bad this practice is in the twenty-first century.

As mentioned, we now live in an extremely data-centric world. Every aspect of our collective lives is based on how we interact with technology and the story that collected data tells. Therefore, placing people into groups—regardless of how small—is no longer a relevant option. In fact, doing so can cause more brand damage than good, as expectations of consumers have moved far beyond the generic.

The biggest issue comes from how segmentation is traditionally implemented: using antiquated qualifiers such as descriptors and demographics. Think about it this way: if you and your best friend lived in the same neighborhood, made the same annual income, were both married, and had the same number of children, then in theory, according to segmentation, you are the same person—at least when it comes to marketing. When spelled out like that, it sounds ridiculous, right?

That’s because you (like everyone else) as a consumer have moved past the idea of segmentation. Your apps that you use daily have become more directed to you as a person. They remember your favorites such as what you like in your coffee, what items you like to buy, and so on. And again, I can at least personally attest to the fact that my best friends drink different types of coffee, and shop for different things than I do, and I can almost guarantee your friends do too.

So what’s the new alternative? Segmentation has evolved into something very different and far more powerful: the new “thing” being personalization. Gone are the days of those sketchy-at-best descriptors and demographics, replaced with the new school, highly accurate and personalized data pertaining to individual behaviors and actions.

If we go back to my coffee example, here’s the real difference between segmentation and personalization. Let’s say that everyone in your segment drinks a large coffee with two milk and one sugar added. Seems legit, and pretty run-of-the-mill. But as an individual, what if you happen to be lactose intolerant? Segmentation wouldn’t know that because no individual data is present in those marketing techniques.

However, in the world of personalization, the coffee shop would know that you are lactose intolerant and never offer you something with milk again. But that’s not where it ends. Knowing this particular point (there could be hundreds but let’s keep it simple for this article), offers are now made based on that data. Now, perhaps around the holiday season, they offer hot chocolate made with a dairy alternative—you would get that ad, while someone else would get an entirely different ad based on their own data. Interestingly enough, that person could be your best friend and neighbor—the same one that fell into your old marketing segment.

In all of this, the most important thing is to understand your customer as an individual, and to also understand that their expectations have evolved. The new world order of all-connected-all-the-time has greatly influenced global culture. For every segmented ad, there are now becoming far more personalized ads.

The catch here is that the evolution has already begun and retailers need to catch up or lose to those who are keeping up with the times. In the end, everyone is different—shouldn’t they now be treated as such?