Customer groups allow you to organize your customers. You can also have discounts based on customer groups. You can also get trend analysis for each group. Typically Customers are grouped by market segment (that is usually based on your domain).
Tip: If you think all this is too much effort, you can leave it at “Default Customer Group”. But all this effort, will pay off when you start getting reports. An example of a sample report is given below:
Next: Sales Person