Better understanding of market segmentation for stronger marketing communications - Cutting Edge Insights (2023)

Better understanding of market segmentation for stronger marketing communications - Cutting Edge Insights (1)

As a communications professional, you will be valued more if you can contribute to your company's marketing efforts. Much better than simply placing marketing activities entirely in the hands of marketers. A fundamental aspect of marketing ismarket segmentation, and while communicators play a minor role, it's important that we understand the process, which is more complex than we often think. It is in our interest to be able to speak knowledgeably about the process in collaboration with marketers, with our own employees and in management meetings. In this way we can enhance the role of communication, the role of marketing communication and the role of strategic planning in the organization. Bottom Line: Understand market segmentation better so you can be a more effective communicator.

Equally important, we can adapt some of the concepts of market segmentation to the role of communication. This knowledge is invaluable for planning and implementing stakeholder engagement activities.

what are we talking about

So let's go through a fully professional market segmentation process that shows us where marketing communications and market segmentation activities come into play.

It's too expensive and overwhelming for a business to market directly to anyone who might be a potential future customer; Therefore, market segmentation is required to enable businesses of all sizes to reach consumer groups with similar characteristics. These groups can be broken down into the most promising segments, and messages that resonate strongly with them can be developed to meet their needs and desires.

At its simplest level, segmentation (also known as matching, segmentation, tailoring, personalization, or niche marketing) occurs when "a persuasive message shares a common trait with the recipient of that message."explica Jacob Teenyfrom the Kellogg School of Management at Northwestern University in Illinois.

The definition

First some definitions:

The purpose of marketingis to match the real needs and wants of consumers with offers from suppliers that are uniquely suited to meet those needs and wants,” explain Dolnicar, Grun & Leisch in their 2018 book,market segmentation analysis,Submitted by Springer. You can download oneFree PDF with 324 pages book, or individual chapters. A paperback version of the book costs $49.99, so the free PDF is an attractive alternative if you're interested.

Ö Goal of market segmentationIts main purpose is to increase the profitability of marketing to potential customers and it is also valuable for making a bigger impact with other audiences.

market segmentationThe process by which a market is divided into distinct subsets of customers with similar needs and characteristics that cause them to respond similarly to a particular product offering and marketing program, as defined inmarketing strategy, by Walker, Gountas, Mavondo, and Mullins (2012).

another angle:market segmentationis the practice of dividing your target market into accessible groups. 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.

Market segmentation is at the heart of successful marketing. Put simply, it's about slicing markets. Ideally, consumers belonging to the same market segments or buyer groups are very similar in their consumption characteristics. We'll take a closer look at that later.

Analysis of market segmentation, likedefined by Dolnicar, Grun and Leisch, is “the process of grouping consumers into naturally existing or artificially created consumer segments that share similar product preferences or characteristics”.

The benefits of market segmentation.

Businesses that segment their market properly reap significant benefits. The most important short-term goal for most of these companies is to increase profitability, while other types of organizations may use other key performance indicators, such as: B. the number of donations received or the number of volunteers recruited.

Higher profitability

Several examples demonstrate the increased profitability and other benefits that result from market/customer segmentation activities:

(Video) Understanding Today's Customers Through Segmentation

A study by Bain & Company, published inHarvard Business ReviewIn 2008, it found that "81% of executives said [customer segmentation] was a critical tool for increasing profits." However, "less than 25% believed their companies were using it effectively." Bain also found that "Companies successfully tailoring product and service offerings to desirable customer segments, has reported annual earnings growth of approximately 15% over a five-year period. On the other hand, companies that fail to connect the right value propositions to the right customer segments only see 5% annual earnings growth.”

Other benefits

A number of other benefits described byQualification:

  1. Stronger Marketing Messages: You no longer have to be generic and vague: you can speak directly to a specific group of people in a way that they can identify with because you understand their characteristics, wants and needs.
  2. targeted digital advertising– Market segmentation helps you understand and define the characteristics of your audience so you can target your marketing efforts by age, location, shopping habits, interests and more. Specific.
  3. Development of effective marketing strategies.: When you know your target audience, you know what methods, tactics, and solutions best appeal to them.
  4. Better response rates and lower acquisition costs: These are the result of the creation of your marketing communications either in promotional messages or in advanced segmentation on digital platforms such as Facebook and Google using your segmentation.
  5. Get the right customers: Market segmentation helps you create targeted, clear and direct messages that attract the people you want as customers.
  6. Greater Brand Loyalty– When customers feel understood, exceptionally cared for and secure, they are more likely to stay with your brand.
  7. Differentiate your brand from the competition: More specific personal messages make your brand stand out.
  8. Identification of niche markets– Segmentation can not only reveal underserved markets, but also new ways to serve existing markets – opportunities you can use to grow your brand.
  9. Niche segments correspond to organizational skills: in terms of needs are large enough to be profitable, have strong growth potential.
  10. Stay tuned in to message: Because targeting is so linear, it's easy to stay on top of your marketing strategies and not get distracted by less effective areas.
  11. drive growth: You can encourage customers to do thisbuy you again, or switch from a cheaper product or service.
  12. advanced benefits: Different customers have different disposable incomes; Prices can be adjusteddepending on how much they are willing to spend. Knowing this can help ensure you don't oversell (or undersell)..
  13. product development– You will be able to keep the needs of your customers in mind and develop different products to suit different areas of your customer base.

Impact of the market segmentation obligation

Market segmentation is a fundamental marketing strategy, but it must be the most appropriate solution. It is a long-term strategy that requires significant commitment from top management and the necessary allocation of resources that entail significant changes and financial commitments.

Research is required, including field studies and focus groups, testing of alternative marketing messages and advertising concepts. Of course, an expected increase in sales is necessary to justify the use of resources. Market segmentation strategy should generate more net profit than other marketing options.

Potential changes include new product development, refinement of existing products, changes in pricing and distribution channels used to sell the product, and any marketing communications in support of the changed strategy. These changes, in turn, are likely to lead to changes within the organization's internal structure. To maximize the benefits of market segmentation, companies rely primarily on market segments rather than organizing around products. Segment-responsible business units are well suited to ensure continuous alignment with the ever-changing needs of market segments.

These changes require long-term organizational commitment and therefore the decision to explore the potential of a market segmentation strategy must be taken at the highest level of leadership and communicated and supported consistently and continuously at all levels of the organization and across all lines of business. .

Factors affecting a company's segmentation strategy

Several factors can have an impacta company's segmentation strategy:

  • company resources: When resources are limited, a focused strategy can be most effective.
  • product variability: In the case of very uniform products (e.g. sugar or steel), undifferentiated trade may be more appropriate. For differentiable products (e.g. automobiles), a differentiated or concentrated approach is indicated.
  • product lifetime: A release stage version can be used for new products, but this can be expanded to a more segmented approach over time. As more competitors enter the market, differentiation may be necessary.
  • market characteristics: If all buyers have similar tastes or are not willing to pay more for different quality, undifferentiated marketing is indicated.
  • competitive activity: When competitors are using differentiated or concentrated market segmentation, using undifferentiated marketing can be fatal to your campaign. You should consider using a different market segmentation approach.

Cost of market segmentation

Companies have to make significant financial commitments when implementing market segmentation. Several people have to spend a lot of time for a thorough analysis, which can be quite a complicated process. When top management commits to a segmentation strategy, more human and financial resources are needed to develop and implement a tailored marketing mix.

Evaluating the success of the segmentation strategy and continuously monitoring market dynamics (which may indicate the need for a change in strategy) implies a continuous commitment of resources. And these resource commitments are made with the assumption that there will be a valuable return on that investment.

If market segmentation is not implemented well, the entire exercise is a waste of resources at worst. Instead of leading to a competitive advantage, a flawed market segmentation strategy can lead to significant costs that do not generate additional revenue but marginalize the people involved in the activity.

Main stages of market segmentation

Better understanding of market segmentation for stronger marketing communications - Cutting Edge Insights (2)

Descriptions of the number of steps in the segmentation process can vary depending on the strategists involved and whether steps are segmented. Here are some important steps:

  1. Decide if it's worth it. Segmentation is a long-term commitment that requires time and resources. To reap the full benefits of segmentation, companies must be open to change, whether by changing their products or even by restructuring the business according to the needs of the market segments. The expected increase in sales should be enough to justify the effort to implement the strategy. Organizations must weigh the pros and cons and decide whether or not to proceed.
  2. State your ideal destination.Is there a need for your products and services? Is the market big or small? Where does your brand stand in today's market?
  3. Collect and explore data.Market data is the basis of all segmentation studies. Polls are the most common source of data, but they can be unreliable for reflecting behavior. Explore other options, such as B. Customer data from customer cards or data from surveys and experiments. You must also decide what type of information you want to collect. The most common criteria are geographic (customer location), socio-demographic (age, gender, income, education), behavioral (e.g. how much they spend or where they shop), and psychographic (lifestyle, interests or ambitions), although this may vary on your business. . The best is what works for your business at the lowest possible cost.
  4. Segment your market: Decide which of the criteria (demographic/firmographic, psychographic, geographic, or behavioral) you want to use to segment your market. You don't have to limit yourself to just one; In fact, most brands use a combination, so try each and see what works best.
  5. understand your market: Do this by conducting preliminary research, focus groups, surveys, etc. Ask questions about the segments you choose, using a combination of quantitative (checkbox/selectable) and qualitative (open-ended vs. open-ended text) responses. ) Questions.
  6. Create customer profiles and customer segments: Analyze your survey responses to highlight which customer segments are most relevant to your brand.
  7. Decide which segment you want to target.You need to ask yourself two main questions: Which segments do you want to target? And how likely are they to choose you over your competitors? If you decide to target more than one segment, make sure they are compatible with each other.
  8. Design the marketing mix. You need to consider how best to position and reach your product in each. The marketing mix provides a tool kit whose main components are the 4Ps: product, price, promotion and location. You may need to redesign or redesign your existing range (product), change your pricing or discount structures (pricing), reconsider your distribution channels (location), and develop new messages and ways to reach your target audience (advertising). Analysis of each market segment can help you understand customers' lifestyle choices and benefits, and help you make advertising decisions.
  9. Test your marketing strategy- After interpreting your answers, test your results on your target market using conversion tracking to see how effective it is. And keep trying. If adoption is disappointing, revise your segments or your research methods.

Criteria for evaluating the attractiveness of the segment

The segmentation team must ask a series of questions that fall into two broad categories. The answer to these two questions forms the basis of thetarget segment decision:

  1. Which of the market segments does the organization most want to target? In which segment does the organization wish to engage?
  2. In each of the segments, which of the organizations offering the same product would you like to buy? What is the probability that our organization will be elected? How likely is each segment to interact with us?

Unfortunately, there is no standard formula for assessing the attractiveness of market segments, so much subjective judgment must be exercised. However, several considerations can be used to evaluate market segments in terms of their overall attractiveness. Below are some questions that may be asked.

segment size and growth
  • How big is the market?
  • Is the market segment important enough to be profitable? (Segment size can be measured by the number of customers, but better metrics might include value or sales volume.)
  • Is the market segment growing or shrinking?
  • What are the signs that the growth will continue over the long term? Is the observed growth sustainable?
  • Is the segment stable over time? (The thread must have enough time to reach the desired level of performance)
Structural attractiveness of the segment
  • How far are competitors targeting this market segment?
  • Do buyers have bargaining power in the market?
  • Are replacement products available?
  • Can we create a viable position to differentiate ourselves from all competitors?
  • How receptive are consumers in the industry to the marketing program?
  • Is this market segment accessible and affordable? (e.g. for sales and promotion)
Business Goals and Resources
  • Does this market segment fit our corporate purpose?
  • Do we have the necessary resources to enter this market segment?
  • Do we already have experience with this market segment or similar market segments?
  • Do we have the skills and/or knowledge to successfully enter this market segment?

implementation obstacles

Despite all the advantagesmarket segmentation, companies still find it difficult to implement best market segmentation practices. This raises concerns about market segmentation best practices. It is very important to understand the benefits and limitations of market segmentation in order to effectively face your challenges.

(Video) Week 8 Lecture - Marketing Recap for Assessment 1

  1. Management. A lack of leadership, proactive advocacy, commitment and participation in the market segmentation process by top executives undermines the success of market segmentation. Unless the CEO sees the need for a segmentation review, understands the process, and is actively interested in it, it is virtually impossible for a senior marketing executive to put the results to meaningful use.
  2. Insufficient resources.Senior management can also hamper successful implementation by not allocating sufficient resources, either for the initial market segmentation analysis itself or for the long-term implementation of a market segmentation strategy.
  3. unprepared organizational culture. Successful implementation has been hampered by a lack of market or consumer orientation, resistance to change and new ideas, a lack of creative thinking, poor communication, and a lack of sharing of information and views between organizational units. , short-term thinking, lack of willingness to change and office politics.
  4. lack of education. If senior management and the segmentation team do not understand market segmentation or the implications of such a strategy, any attempt to implement market segmentation is likely to fail.
  5. Lack of marketing experience.In the organization. The more diverse the market and the larger the organization, the more important it is to have a high degree of formalization. The lack of a qualified data administrator and analyst in the organization can also present major obstacles.
  6. inherent limitationssuch as a lack of financial resources or the impossibility of making the necessary structural changes. A company with limited resources only has to select the best opportunities. Obstacles related to the process include not making the program's goals clear, lack of planning or poor planning, lack of structured processes to guide the team through all steps of the process, poor assignment of responsibilities and time pressure, the way that affects the program. to try to find the best possible segmentation result.
  7. Lack of management understanding.. Industry acceptance of science is disappointing because management doesn't use techniques it doesn't understand. One way to counteract this is to make the market segmentation analysis more understandable and to present the results in a way that is easier for managers to interpret. This can be achieved through the use of graphical views.
  8. Individuality.Qualitative surveys create many statistical segments, but creating a target segment isn't easy. Because everyone is unique, it's difficult to categorize people based on their buying behavior. Market segmentation can take into account one person's position within the segment and leave others out. With so many options to consider, it can be difficult to segment customers,bython sea.
  9. Keep market segments up to date. This is another challenge in market segmentation. Segments are constantly evolving. Therefore, they need to be updated frequently. As such, keeping them up to date can be quite a challenge. This is another finding by Bython.

Most of these obstacles can be identified early on in a market segmentation study and eliminated proactively. If the barriers cannot be removed, the team leader should seriously consider giving up trying to explore market segmentation as a possible future strategy.

Before you jump, check this out

In addition to the tasks, this checklist contains a number of questions which, if not answered, serve as an exclusion criterion. For example, if an organization is not market-oriented, even the best market segmentation analyzes cannot be implemented successfully.

Proceeding with market segmentation analysis requires a strong sense of purpose and commitment, as well as patience and a willingness to assess the inevitable problems that will arise in implementing the conclusions of the analysis.

Serious questions to ask yourself and management

  1. Is the culture of your organization market-oriented?
  2. Is your organization really ready to change?
  3. Does your organization have a long-term perspective?
  4. Is the organization open to new ideas?
  5. Is the communication between the organizational units good?
  6. Is the organization able to make significant (structural) changes?
  7. Does the organization have sufficient financial resources to support a market segmentation strategy?
  8. Is it able to get a visible commitment to market segmentation from senior management?
  9. Can you ensure senior management's active participation in the market segmentation analysis?
  10. Can you secure the necessary financial commitment from management?
  11. Can you ensure that the concept of market segmentation is fully understood? If not, conduct training until you fully understand the concept.
  12. Can you ensure the implications of a market segmentation strategy are fully understood? If not, conduct training until the implications are fully understood.
  13. Can you put together a team of 2-3 people (segmentation team) to do the market segmentation analysis?

Building a market segmentation team.

You should be able to follow these steps to set up a market segmentation team:

  1. Make sure there is a marketer on the team.
  2. Make sure you have a data expert on the team.
  3. Make sure there is a data analysis expert on the team.
  4. Establish an advisory committee representing all affected organizational functions.
  5. Make sure the objectives of the market segmentation analysis are clear.
  6. Develop a structured process to be followed during market segmentation analysis.
  7. Assign responsibilities to segmentation team members using the framework process.
  8. Ensure that there is enough time to carry out the market segmentation analysis without time pressure.

exclusion criteria

AfterDonicar and ai.certain criteria are used to determine whether the market segments resulting from the market segmentation analysis are promising enough to continue. The segmentation work requires several criteria to be met. If not, you should not commit the following:

  • The segment must behomogeneous. Segment consumers should be similar to each other.
  • The segment must bedistinguishable. Segment consumers must clearly differ from people in other segments in terms of the required characteristics or behavior.
  • The segment must bebig enough. The segment needs to contain enough consumers that it's worth spending the extra money to customize the marketing mix for them.
  • segment consumers shouldPhosphorthe strengths of the organization. The organization must be able to meet the needs of the segment's consumers.
  • segment consumers should beidentifiableThey must be findable in the market.
  • The segment must beaccessible. There must be a way to reach segment consumers so that the personalized marketing mix is ​​accessible to them.

These criteria must be understood by senior management, the segmentation team and the advisory board. Most of the criteria do not require further specification, but some do. For example, although the size is non-negotiable, you must specify the exact minimum size of the target segment that can be achieved.

Market Segment Profile

Market segmentation is a strategic marketing tool. The selection of one or more target segments is a long-term decision that significantly influences the future performance of an organization.

The work done in the early stages of the segmentation process enables analytics to determine where consumer preferences lie.

Better understanding of market segmentation for stronger marketing communications - Cutting Edge Insights (3)

marketing decisions

Many marketers are consideringa4P de MarketingThey include the main elements of the marketing mix:

  1. Products
  2. Preis
  3. financial support
  4. Ort

Segmentation, targeting, positioning

Market segmentation is not a marketing strategy in its own right. Rather, it is linked to the other areas of strategic marketing, specifically positioning and competition. The market segmentation process is deceptively simple. However, the task can be very tedious as it involves reviewing large amounts of data and requires great analytical skills, interpretation and some judgement. Extensive analyzes are required and many decisions have to be made. In fact, the segmentation process is often considered part of the so-called segmentation process.Segmentation Target Positioning(STP), which proposes a sequential process.

  • segmentationincludes target market identification, selection, segmentation; and description and profiling.
  • guidanceIt consists of evaluating the attractiveness of each segment and choosing the segments to target.
  • positioningIt's what a company can do to ensure that its product is perceived as significantly different from competing products and is aligned with the needs of the segment.

Perhaps the most important marketing decision is choosing one or more market segments to focus on. Because customers in a market segment are expected to have unique needs, a company that develops an overall product that is uniquely focused on the needs of that segment will be better able to meet the needs of that segment than a company that whose product or service attempts to meet the needs of that segment and the needs of others. other. this segment. multiple segments.

Identify the target market.

There are two approaches to segmenting a market: a discovery approach or an analytical approach. Each approach is appropriate for the type of business and target market. Both approaches provide an indication of a segment's likely future profitability and the trends and behaviors it exhibits.

Eanalytical approachit is much more dependent on research and data where two sets of information have been obtained and used to segment the market. This approach shows the likely future growth of the segment and whether it is worth investing resources. Therefore, this is usually done in advance. The second approach is more based on observing buying behavior within the segment and on primary research.

Ödiscovery approachIt is best suited for a market with a comparatively small number of customers, and the segment finding process is based on interest in the offer or a similar offer that the company could offer to the potential customer. Because of this, a discovery-based approach is a much faster process for determining profitable segments. Both approaches can benefit from elements of each other and work well in combination in most situations to determine a defined profitable segment.

(Video) Consumer Segments: New Online Research Approaches for Better Understanding

potential market

The potential market for a particular product or service to be targeted must first be explored by determining the size of the potential market. With existing products and services, it is easy to estimate the size and value of the potential market. However, this becomes much more difficult when a product or service is completely new to the market and no previous data is available on which to base predictions.

A basic approach is to first assess the overall market size, then estimate the percentage of people who are likely to use the product or service, and finally estimate the revenue potential.

It makes sense to consider market segmentation as the first step in the segmentation-target-positioning approach, as it ensures that segmentation is not viewed independently of other strategic decisions. However, it is important not to strictly adhere to the sequential nature of the segmentation target positioning process. It may be necessary to go back and forth from segmentation to targeting before committing to one or a few target segments over the long term.

When conducting market segmentation analysis to inform advertising decisions, intended benefits, lifestyle targeting variables, and psychographic targeting variables are particularly useful as they are a combination of all.

Choosing a suitable foundation

An important step in the segmentation process is the selection of an appropriate base. In this step, marketers try to minimize the differences between the people in a segment and maximize the differences between each segment.Marketers can segment the market.using a basis or variable that is identifiable, substantial, responsive, actionable, and stable:

  • identifiableis when the different groups within the market can be identified or recognized
  • significantThis is when a segment or group of customers is large enough to be profitable. This can mean a sufficiently large number of people or purchasing power
  • AccessibleMarketers can reach target segments with advertising or sales activities
  • sensitiveRefers to the extent to which consumers in a defined segment respond to marketing offers directed at them.
  • workable– when data shows that segments are an appropriate reference source for marketing decisions.

Types of market segmentation.Better understanding of market segmentation for stronger marketing communications - Cutting Edge Insights (4)

With segmentation and targeting you want to understand how your market reacts in a certain situation, e.g. B. when purchasing your products. In many cases, a predictive model can be built into the study, allowing you to group people based on specific responses to identified segmentsresearch questions.

demographic targeting

demographic targetingclassifies a market based on factors such as age, education, income, family size, race, gender, occupation and nationality. Demographics is one of the easiest and most common forms of segmentation, as the products and services we buy, how we use those products, and how much we are willing to spend on them are often based on demographic factors.

geographic targeting

geographic targetingcan be a subset of demographic targeting, although it can also be a distinct type of targeting. Create different groups of target customers based on geographic boundaries. Because potential customers have different needs, preferences, and interests depending on their geographic location, understanding the climate and geographic regions of your customer groups can help you determine where to sell and advertise, and expand your business.

firmographic segmentation

Firmographic segmentation is similar to demographic segmentation except demographic looks at individuals while firmography looks at organizations. Firmographic segmentation would take into account things like company size and number of employees, and illustrate how targeting a small business differs from targeting an enterprise.

Behavioral Targeting

Behavioral segmentation divides markets according to behaviors and decision patterns such as purchase, consumption, lifestyle and use. For example, younger consumers are more likely to purchase bottled liquid soaps, while older consumer groups prefer bar soaps. Segmenting markets based on buying behavior allows marketers to take a more targeted approach as they can focus on what they know and are therefore more likely to buy.

(Video) MAR101 - CH6 - Segmentation, Targeting, & Positioning

psychographic segmentation

psychographic segmentationIt takes into account the psychological aspects of consumer behavior and segments markets on the basis of consumers' lifestyle, personality traits, values, opinions and interests. Large markets like fitness use psychographic segmentation when segmenting their customers into categories of people who care about healthy living and exercise.


Segmentation follows segmentation and is the process of determining target markets and planning the promotional tools that will be used to make the segment attractive. Segmentation is a changing environment. Traditional practices of targeted advertising via print and other media gave way to a social media presence, resulting in a much more internet-connected approach. Behavioral targeting is a product of this shift and focuses on optimizing online advertising and collecting data to send a message to potential audiences. This process relies on the collection of cookies collected from the consumer's browser and sold to companies to identify potential segments to target.

For example, someone who regularly searches for kitchen utensils is likely to see ads that sell kitchen utensils because the cookie information you provided shows interest in that area.

There are three different market coverage options to consider when targeting a market: undifferentiated, differentiated, and niche marketing. The choice of the following targeting option depends on the product or service offered:

  • Undifferentiated Marketing, also called mass marketing, is a strategy that consists of creating a message for an entire audience. It helps businesses reach more people at a lower cost and improves brand awareness.
  • differentiated marketingA company creates marketing campaigns that target two or more segments of its target audience.
  • ONEmarket nicheIt is a small market segment that represents a subset of the market that a particular product is focused on. It defines the characteristics of the product intended to satisfy the specific needs of the market, as well as the price range, quality of production and demographics it aims to achieve.


Werbeguru Sea David Ogilvy „positioningIt is about shaping the offer and the image of the company in such a way that it occupies a distinctive place in the consciousness of the target market. The goal is to place the brand in the minds of consumers in a way that maximizes the potential benefit to the company. Good brand positioning helps align marketing strategy by clarifying the essence of the brand, what goals it helps the consumer achieve, and how it uniquely does so.

Positioning is the final phase of the "STP" process and focuses on how the customer views your product or service compared to your competitors. This step is important to gain a competitive advantage in the market. Therefore, customer perception has a major impact on the positioning of brands in the market.

Three types of positioning

Fullthree types of positioningwhich are fundamental to position the brand in a competitive advantage; These are functional positioning, symbolic positioning and experiential positioning.

  • functional positioningfocuses on aspects of products or services that can satisfy consumer needs or desires.
  • symbolic positioningIt is based on brand attributes that satisfy customers' self-esteem.
  • experiential positioningIt is based on brand characteristics that stimulate a sensual or emotional bond with the customer.

It makes sense to consider market segmentation as the first step in the segmentation-target-positioning approach, as it ensures that segmentation is not perceived as independent of other strategic decisions. A combination of the three is key to positioning the brand with a competitive advantage over its immediate competition. Remember it's importantdon't follow a very strict orderto the segmentation target positioning process. It may be necessary to go back and forth from the segmentation to the targeting step before committing to one or a few target segments in the long run.

Overall, the positioning should offer better value than the competition and effectively communicate that differentiation to the consumer.

Data sources used for targeting

Marketers use a variety of data sources for market profiling and segmentation studies. typicalsources of informationcontain:

internal fonts
  • Customer transaction records, e.g. B. Sale amount per transaction, purchase frequency
  • User Membership Records, p. active members, former members, length of membership
  • Customer relationship management (CRM) databases.
  • Internal polls
  • Self-completed questionnaires or customer feedback forms
External Sources
  • Contract research (where the company commissions a research study and retains exclusive rights to the data - typically the most expensive means of data collection)
  • Data Mining Techniques
  • Census data (population and business census)
  • observed buying behavior
  • authorities and offices
  • State Statistics and Research, p. Studies in the fields of trade, industry, technology, etc.
  • Omnibus surveys (a standard, periodic survey with a core set of demographic and lifestyle questions, to which an individual can add specific sets of questions about preferences or product usage, often at a lower cost than survey method managers)
  • professional/industry/employer associations
  • Proprietary research or follow-up studies (akasyndicated research; studies conducted by market research companies, where companies can purchase the right to access part of the data set)
  • Proprietary Databases/Software.

read more

You can read more about marketing communications in my article “How to use features and benefits in your marketing communications“.


1. Customer segmentation in complex B2B markets
(Product Marketing Alliance)
2. OnTrak Clothing Presentation
(Avado Project)
3. Is Your Understanding of the Market Obsolete? (feat. Hilary DeCamp)
(Center for Customer Insights and Digital Marketing)
4. The Proven Omnichannel Marketing Strategy That Will Deliver The Best Customer Experience Yet
(Ad World Conference)
5. Keynote: Lessons from the Cutting Edge of B2B
(LinkedIn Ads)
6. Supercharge Your Omni-Media Strategy with Data and Insights. | Bloom x Happyfication


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