What are customer groups used for in Magento?

Customer groups in Magento are primarily used to categorize customers for targeted promotions. This functionality allows businesses to create specific segments based on customer characteristics such as purchase behavior, geographic location, or account type. By grouping customers, businesses can tailor marketing efforts and discount strategies, ensuring that promotions are relevant to the specific interests and needs of each group.

For instance, businesses can provide exclusive discounts to loyal customers or run promotional campaigns aimed at new customers. This capability enhances marketing efficiency and improves customer engagement, as it enables a more personalized shopping experience.

In contrast, increasing the number of products listed does not directly relate to customer grouping, as customer groups primarily focus on segmentation rather than inventory management. Managing shipping options pertains to logistics and order fulfillment processes, thus falling outside the scope of customer group functionalities. Similarly, restricting access to certain products can be achieved through other means in Magento, such as catalog permissions or product visibility settings, rather than through customer group classification.