BrainTrust Query: Four New Approaches to Consumer Segmentation in a Digital and Social Age
Through a special arrangement, presented here for discussion is an excerpt of an article from the Joel Rubinson on Marketing Research blog.
Traditional consumer segmentation can be maddening. It is at the heart of marketing practice to group consumers into segments based on their needs and self-stated psychographic profiles, and to then attempt to target a high priority segment with new offerings and advertising. Yet it simply does not work that well because it is rarely very actionable.
In the digital and social age, here's how that can change:
Segment moments. I am much more interesting to Ford or General Motors when I am looking to buy a car then right after I make a purchase, am I not? In a digital and social age, moments become directly targetable because I, the consumer, do things differently on my self-guided tour of the internet depending on my current goals, thereby giving out forensic signs. I seek out different content, I search for different terms, I like different things on Facebook, and different products show up on my frequent shopper data. All are highly targetable without needing to water things down with demographics.
Segment for ad targeting based on brand loyalties. Increasingly, digital and social data can be merged with frequent shopper data for ad targeting. (Facebook just cut a deal with Datalogix to do this, for example.) Rentrak and TRA have each merged TV viewing with frequent shopper data. The "so what" is that a marketer can now target their advertising to "switchables," those who buy your brand occasionally, but not most of the time. A much higher response to advertising and promotions comes from switchables than from those who are completely loyal to either you or some competitive brand.
Segment people as shoppers. Do I plan purchases or decide in-store? Do I like to explore to find new meal ideas? Do I like to sample the gourmet cheeses? Do I like to sniff the fragrances of air fresheners and shampoos? All of these have clear action implications for category adjacencies, store layouts and specific shopper promotions delivered in a customized way, increasingly via mobile apps. Is there a consumer attitudes segmentation that can claim the success of what dunnhumby did for Tesco in the U.K.? Not that I know of.
Segment people based on targetable interests and values. Analyze the interests, cultural values, and lifestyle characteristics available via Facebook or Google profiles and create segments on factors that reflect those actionable characteristics. Besides being able to readily act on such segmentation, every ad campaign becomes a test as the right segment should exhibit greater response.
Jim Stengel, the former CMO at Procter & Gamble said at a conference in October 2012, "Get close to the consumer and do something with it." Now with digital data and matching to frequent shopper data, we can finally "do something with it."