In this whiteboard animation, we’re going to discuss how a brand can inform its marketing strategy by dividing its customer base according to a variety of segmentation criteria. In simple terms, you should know your customer. A brand cannot be everything to everyone, in order to create an attractive value proposition it’s necessary to make your product fit a particular need in the market and to do so, selecting the customers you are willing to assist is the first step to creating a coherent strategy. A first perspective that can be adopted to qualify your audience is descriptive segmentation, focused on describing material, quantitative characteristics shared your audience.
These criteria includes:
Alternatively, segmentation can decide not to focus specifically on the individual as a person, as much as an individual as a consumer. In this case, we need to understand elements which are more behavioural.
In other words, we need to clarify not who our customer is, but instead, we need to understand what pushes a consumer to make a purchase. This typology of segmentation is much harder to carry out, as we need to understand behavioural patterns and relationships of causality.
Behavioural segments instead relate to:
Finally, the last category of segmentation criteria we are going to review is called psychographic segmentation. This segmentation relates to how a purchase decision is a reflection of an inner concept of self.
An example of a psychographic segmentation criteria reflects a customer’s ability to spend, according to the following segments:
Customer segmentation is also affected by new drivers connecting a firm to its audience: for example sharing and co-creation.
To some extent, as we identify who are our customers and why they buy our products, we need to understand what kind of relationship to build with them. In the past, the relationship with customers was much more hierarchical, meaning that customers could decide whether to buy or not to buy our products, but could not partake in the value creation process. Now the barrier between the brand and the customer is dissolving creating the opportunity to use a product to develop a more profound connection and relationship with our target segments.
More information about how to build a relationship with your customer and experietial-ise your brand can be found on our video on experiential branding.
Matching your products with the right customer segment, while at the same time forming shopping habits is a challenge for many brands.
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