With segmentation and targeting, you want to understand how your market will respond in a given situation, like what causes people to purchase your products. You want to target customers based on purchase behaviors You want to target customers based on values or lifestyle<</p> You are a smaller business or you are running your first project< You are a smaller business or you are running your first project Lifestyle Personality Traits Values Opinions Industry Location Number of Employees Revenue Geography Gender Education Level Income Level There are four primary categories of segmentation, illustrated below.Ĭlassification based on individual attributesĬlassification based on company or organization attributesĬlassification based on behaviors like product usage, technology laggards, etc. Understanding segmentation starts with learning about the various ways you can segment your market as well as different types of market segmentation. Product development: You’ll be able to design new products and services with the needs of your customers top of mind, and develop different products that cater to your different customer base areas.Ĭompanies like American Express, Mercedes Benz, and Best Buy have all used segmentation strategies to increase sales, build better products, and engage better with their prospects and customers.Knowing this can ensure you don’t oversell (or undersell) yourself. Enhanced profits: Different customers have different disposable incomes prices can be set according to how much they are willing to spend.Driving growth: You can encourage customers to buy from you again, or trade up from a lower-priced product or service.Staying on message: As segmentation is so linear, it’s easy to stay on track with your marketing strategies, and not get distracted into less effective areas.Identifying niche markets: segmentation can uncover not only underserved markets, but also new ways of serving existing markets – opportunities which can be used to grow your brand.Differentiating your brand from the competition: More specific, personal messaging makes your brand stand out.Increasing brand loyalty: when customers feel understood, uniquely well served, and trusting, they are more likely to stick with your brand.Attracting the right customers: targeted, clear, and direct messaging attracts the people you want to buy from you.Better response rates and lower acquisition costs: will result from creating your marketing communications both in ad messaging and advanced targeting on digital platforms like Facebook and Google using your segmentation.Developing effective marketing strategies: Knowing your target audience gives you a head start about what methods, tactics and solutions they will be most responsive to.Targeted digital advertising: Market segmentation helps you understand and define your audience’s characteristics, so you can direct your online marketing efforts to specific ages, locations, buying habits, interests etc.Stronger marketing messages: You no longer have to be generic and vague – you can speak directly to a specific group of people in ways they can relate to, because you understand their characteristics, wants, and needs.Bain also found that organizations with great market segmentation strategies enjoyed a 10% higher profit than companies whose segmentation wasn’t as effective over a 5-year period. According to a study by Bain & Company, 81% of executives found that segmentation was crucial for growing profits. Read on to understand why segmentation is important for growth and the types of market segmentation to use to maximize the benefits for your business.įree eBook: How to drive profits with customer segmentation The benefits of market segmentationĬompanies who properly segment their market enjoy significant advantages. Market segments can power your product development cycles by informing how you create product offerings for different segments like men vs. Market segmentation creates subsets of a market based on demographics, needs, priorities, common interests, and other psychographic or behavioral criteria used to better understand the target audience.īy understanding your market segments, you can leverage this targeting in product, sales, and marketing strategies. Market segmentation is the practice of dividing your target market into approachable groups.
0 Comments
Leave a Reply. |