We can’t be all things to all people. Segmenting our market and understanding our buyer personas are critically important to driving measurable marketing. In this blog, we look at segmentation and personas, and understand how they create a strong foundation to support the implementation of marketing activity.
A one-size-fits-all approach to market segmentation does not work. Every brand and category needs a customised approach, taking into account success factors that are important to your business. The solution must be the right one given your market situation.
Segmentation analysis has developed out of several key premises:
- In today’s economy, brands can only sell effectively to certain segments of any market – forget the notion of ‘we are going after everyone!’
- Sound marketing objectives depend on knowledge of how segments produce the most customers for a company’s brands.
- These differ in requirements and susceptibilities from the segments which produce the largest number of customers for competitive brands.
- Traditional demographic methods of market segmentation do not usually provide enough and are not likely to provide the right direction for marketing strategy as management requires.
- Therefore, segmentations can often over promise but under deliver.
What do you do with a segmentation?
If the segmentation is sound, you should hope to do some or all the following:
- Appraise competitive strengths and vulnerabilities of your brand.
- Plan a product line.
- Determine an advertising and selling strategy.
- Set precise marketing objectives against which performance can later be measured.
Segmentation provides leverage for successful market strategy.
- Direct attention and money to the most profitable segments.
- Design a product line that delivers to market needs or demands.
- Follow trends in swiftly changing markets.
- Choose and budget communications more wisely and determine the proportion of budget for maximum anticipated impact.
Segmentation needs to be customised to your unique business needs
Given the investment in research like segmentations can be high, we believe it needs to be customised to your unique business needs, with a focus on some key drivers of success:
1. Bring your Key Stakeholders on the journey
- Apart from obvious buy in, we need to understand what problems should be solved. Without segmentation driven business decision-making, what are their pain points? What do they know about segmentation?
- How are they hoping to use the outputs and across what dimensions?
- What sorts of output tools will work for them?
- What does success look like for them?
2. Define your market
- Showing for instance a candidate brand, the degrees of separation between the competition, identifying short term threats, long term growth opportunities and therefore the scope of the segmentation study.
- Charts such as segment construction, showing the relationship between the segments found and the source attribute, so we can see how the segment is constructed.
- Segment selection charts plotting segment size, share, contribution and growth estimates so we can prioritise these for action.
3. Utilise Workshops to ensure understanding and clarity
- A great segmentation is a framework for growth, so management needs to be able to use the tools and get planning straight away.
- We provide a series of workshops following our segmentations to embed the information across communications, research, innovation and staff, depending on your requirements.
- Where appropriate we will also overlay existing data to get the most out of your segmentation framework.
4. Embrace Information Tools into the business
- Good qualitative research goes hand in hand with actionable segmentation tools. Ethnographic or observational research can provide video footage to bring your targets to life, or we can script and provide hype reels to do the job.
- Simple and accessible tools such as infographics, wall charts and one pagers, are important for grounding the information in the everyday and ensuring our business is customer centric.
5. Build planning and monitoring processes into your model
- To ensure action plans can be measured and reviewed, we strongly recommend building your segmentation into your planning cycles and monitoring processes.
Personas can be used to answer a multitude of business challenges. Do you want to gain a deeper understanding of who your customers are? Personas are a way to qualitatively discover what different and distinct groups exist within your current and potential customer base, without having to do a full quantitative segmentation.
We most commonly utilise this technique for companies who are new to market research and are looking to gain an overall understanding of who their customers are and how they think.
In this type of situation, Personas can be useful in helping the company to understand the different broad groupings of behaviour, beliefs, values and ways of interacting with the brand that exist within the customer base.
This data is actionable on its own, providing a solid base to launch strategies and help make more informed business decisions.
For those companies looking to take it a step further, Personas can also be used to drill down on a specific problem or to help make a big decision. Ruby Cha Cha can apply Persona discovery to a focused area to find out the different groupings of opinion on a certain area such as NPD, advertising or service delivery.
This allows your company to:
- Gain a deeper understanding of the different ways that your customers will react to the concept being tested.
- Use this data to create tailored delivery of the concept to each Persona.
- Anticipate any problems that may arise before they happen.
Another application for Ruby Cha Cha’s Buyers or Customer Personas is to use them to create better quantitative instruments to ensure that you are getting the most accurate, actionable data out of your quantitative spend.
Using Personas in this way involves a multi stage approach to research.
It begins with an exploratory qualitative phase.
During this phase Ruby Cha Cha will uncover the Personas that exist within your customer base. This phase can also be used to discover other important data about your customers such as the language they use, and what is important to them, all of which can be used to create a sharp, targeted survey instrument that will deliver the highest quality research results.
The next phase is the quantitative phase.
The personas uncovered in the first stage of research can then be carried over to the quantitative phase to be sized and tested and turned into representative segments that provide the most accurate depiction of who exists within your customer base.
Personas are great outputs for U&A (Usage and Awareness) studies, where the help us divide up a homogeneous group of customers to better understand the different ways in which customers relate to the brand.
This understanding can then be used to drive the delivery of new products and advertising campaigns that appealed to different Personas in different ways. Also helps ensure that any Personas with a history of feeling ignored or left out of decision making from the brand can be targeted, driving brand satisfaction and success rates of new products.
Buyer Personas outputs are constructed in many ways. They can include hard data and statistics such as demographics and consumption data as well as soft data from qualitative research.
How do we uncover these Personas?
- Qualitative Research.
It is during the all-important analysis phase of research that the Personas emerge. Discovering your customer Personas involves using many tools of the qualitative trade, of which our team has extensive experience in.
- Industry Insights.
Years of expertise and industry knowledge allow us to pull apart the significant insights from the mundane pieces of information that won’t provide real benefits to your company, and read in between the lines to unearth the real differences between the customers we have spoken to.
- Persona Discovery.
Ruby Cha Cha is also at the top of its game in delivering research findings such as your newly discovered Personas in the levels of complexity best suited to your company’s needs, and in visually engaging ways designed to stimulate conversation and excitement within your team.