Tags provide a way for CSMs to manually group "like" customers together to define a unique cohort or segmentation that likely doesn't exist elsewhere. In many cases, Tags are used when it's not practical or possible to add a new field to Salesforce. If you're trying to create either a temporary or a permanent grouping that doesn't make sense as a new field in Salesforce, then Tags are useful. (Admins must configure Tags; refer to Configure Customer Tags for more info.)
Tag examples include those that identify customers that participate in a certain event, or perhaps customers that use your products a certain way. For instance, you could create five different product use case tags, and then Tag customers so you know which use case applies to them. This lets you not only tailor outreach, but also do a better job of identifying pre-sales references when a specific use case is desired.
Other use cases for Tags include identifying customers who set up various integrations with your own app (eg. Marketo, DataHug, or Boulder Logic). Tags can also be used to highlight temporary or transient alerts, such as competitor names who most likely represent business threats for a particular customer. Another use of Tags is to identify which of your customers require a "high touch" service level.
Tagging Individual Customers in the Customer360

You can tag individual customers at the top of the C360 page.
Tagging Customers in Mass

You can also Tag customers in mass from the Customers tab. Click the three orange dots to access Tags.

Then use the check box on the left to select the customers you wish to tag, and add the tag in the text area. Click Apply.
Reporting on Tags

Admins can build reports/dashboards or Customer UI Views that filter for the Tag field.
Tips for Tagging
- Tags are typically not associated with a specific time frame unless you're including the time period in the name of the tag itself.
- Keep in mind that reports on groups of tagged customers are only as good as the manual input.