Critical Roll Of Segmentation

We all need to be more cost conscious, get a higher ROI. Many companies have invested very heavily in attitudinal studies and ways to gather and apply segmentation. If you go into segmentation you should be able to get a very accurate personality type for the kind of person or company that is your ideal customer.

Yet, there has been a growing experience that people have been disappointed by segmentation. Could be they are not using it right? If you go into it saying “we are going to find the perfect customer” and haven’t put the right marketing piece together to attack then, it all falls apart.

You might want to look at the metrics that identify the marketplace as a basis of building different customer segments that are more innately applicable to your business in their area of desire not your overall want. You need to get very very specific to use segmentation as a marketing idea. If you combine internal customer data with your market research and come up with some segmented models of perfect customers you can get a picture of who to go after.

Additionally there is a trend with marketers to supplement trasactual customer data with market research and ethnographic data to get a more complete view of your perfect customer. The more accurate you can get the better you are. Historically, these different types of data were kept very distinct and used by different teams within a marketing department. But now, sadly it took a need to reduce marketing budgets, these different groups have stated to come together and create a single segmentation model. It is not wide spread yet, but we are seeing a glimmer of hope.

As much as you might want to move in a more targeted way to approach prospects and customers the data is only half the battle. Segmentation and data is the key, to getting into a target marketing attack, it can be very difficult to gather all the relevant customer information from all the different media channels you are using to get it into a single marketing profile database. Another roadblock is that different channels use the data differently. Online only knows things like age and gender, Telesales must decide what questions they can ask to figure out what “segment” a given prospect falls into in order to ask the right questions. The challenge is how you line up the data to feed out to the channels your using.

3 Stages of customer intelligence

Customer intelligence informs segmentation strategies. In a study by Forrester Research, of 301 marketers 34% achieved marketing intelligence. 12% of those same people said that had researched the strategic intelligence level.

1: Function intelligence. A firm in this category applies the concepts of the customer intelligence at a function level. The scope of influence is limited to a specific channel, product or service. There is seldom a high value given and they often lack the staff and technology to leverage the customer intelligence throughout the entire company.

2: Market intelligence. A firm in this stage or maturity applies customer knowledge to measure and optimize its marketing performance across the channel, products and ort services. These firms use customer intelligence to inform their marketing planning and strategy but are too likely to use it outside of the marketing process.

3. Strategic intelligence. Firms at this stage of maturity use customer intelligence to drive business growth, these firms are more likely to consider customer data as one of their most valued assets and leverage it on a company wide basis.

*Forrester “Assessing Your Customer Intelligence Quotient” November 2009

So who can you put this in place for your company, simply?
Segmentation presents unique challenges to both offline and online marketing. Yet there are still a few practices that all marketing’s working on both platforms and across multichannel channels need to be considering when looking at a segmented targeted marketing attack.

1: Keep is simple. It has to solve real problems, one at a time. If you look at 2 or 3 problems you want to be solving you will get a profile that is so completed that you get nothing back in return.

2: Uncover the right data. Yes it is all about data collection. You need to find out what data you can gather in that is predictive in your best customers and then find a source of outside data that will give you the same kind of prospects of those you have now. This “transactional data” is very predictive but it is not as easy to get and match up as you might think.

3: Pick your partners wisely. Because online / offline and multichannel marketers face different challenges with segmentation it is import to consider who you are working with to do the job. Both internal and outsourced marketing

Larson Notes & Satire: Yes even I mess up trying to have a mailer or landing page try to be doing too much. I want to get the biggest bang out of my dollar and in the end get next to nothing because it does not take to anyone. My best advice is to use the KISS system: Keep It Simple Stupid.
Howard Larson
Larson & Associates
Target Marketing & Telesales Professionals for new account acquisition
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