marketing segmentation digital age

Marketing Segmentation in the Digital Age by Nancy Pekala "If you're on the wrong train, every stop is the wrong stop." ...

0 downloads 130 Views 71KB Size
Marketing Segmentation in the Digital Age by Nancy Pekala "If you're on the wrong train, every stop is the wrong stop." This perspective by David Verklin, CEO of Canoe Ventures LLC, aptly describes marketing segmentation in today’s digital age. During a presentation on marketing segmentation at the AMA’s recent Marketing Research Conference, Eric Paquette, Senior Vice President, Copernicus Marketing Consulting & Research, suggested that digital technologies have forever changes the way content is developed, delivered and consumed which directly impacts segmentation studies conducted today. “Fifty-nine percent of senior executives in large companies have done a segmentation study in the past 2 years, but only 14% of those senior executives involved in a segmentation study derived any value,” Paquette reported. He said the issue is no longer one of just a fragmented audience or a reallocation of time from one medium to another. “Instead, a fundamental shift has occurred in how we communicate, entertain and learn that has massive implications for marketing strategy and marketing communications.” Paquette cited some common problems and associated implications with segmentation studies today including: •

It is unclear which groups represent the biggest profit opportunities. Marketing Implication: There is no guidance on whom to focus marketing efforts



There is little insight into what will motivate each target to buy. Marketing Implication: As a result, there is little help in defining your positioning and messaging strategy, and no assistance in identifying how to make the brand relevant, credible, superior and unique.



The various segments are more similar than different, particularly with respect to media exposure patterns. The targets can't be found in sales and media databases. Marketing Implication: There’s little insight into where to most effectively and efficiently market to these various segments.

Marketing Researchers

1

November 2010

Paquette stressed that there are three basic requirements to successful segmentation and targeting strategy: 1. Who is our most valuable target? Identifying your most valuable target helps define the focus of your marketing efforts. Today, measuring “valuable” has changed. 2. What are their needs, wants, and motivations? This information helps marketers define their positioning and messaging strategy so their brand can be relevant, credible, superior and unique. Today, this also encompasses the message you want your most valuable target to spread to others about your brand. 3.

How and when do we find them? ----So we can advertise to them This, of course, is critical in order to effectively advertise to them and so they can find your brand. Today, it’s also important that you reach them when they are most receptive and in ways they are receptive. It’s all about “moments and mindset”, Paquette said.

FAST FACTS • • • • • • • • •

There are approximately 1.2B internet users 15 years old and older worldwide In 1994, there were about 5,000 websites. Today there are at least 200 million. U.S. adults average about 8 ½ hours of “screen time” each day Over 10 billion songs have been downloaded from iTunes American teenagers are sending over 3,000 text messages a month – more than 10 messages per hour not spent sleeping or in school Almost half of the U.S. on-line population uses social media on a weekly basis In fact, social media has overtaken porn as the #1 activity on the web 690 million Valentine’s Day gifts were given this year…..on FarmVille There are currently about 40 million tweets per day on Twitter

Four Steps to Effective Segmentation This new “eco-system” needs to shape how we think about the marketing strategy – and impacts the requirements for an effective, actionable segmentation and targeting, Paquette said. He suggested that marketers take the following steps to make segmentation and targeting more effective in this new digital world. 1. Include measures of advocacy when assessing the value of segments and selecting a target. “Brand advocates are a small but highly engaged and influential group of customers,” Copernicus’ Paquette said. They typically represent 5-10% of the customer base but are “lovers” of your brand.

Marketing Researchers

2

November 2010

“They have always been valuable because they are influential and can be influenced but are much more so today because of their reach, the speed with which they can influence and the tools at their disposal to influence,” Paquette explained. Some traditional measures of value/profit include: category volume, profit potential, decision making power, price sensitivity and alignment of their needs with core brand strengths. But additional measures of advocacy are useful as well. These include: level of engagement and “love” of your brand, interest in sharing that affection with others and breadth of reach. 2. Understand how your target behaves in the digital environment. As part of the segmentation, it’s important to capture how your targets behave in the digital environment. What do they do online? On their mobile device? Are they “authors”, “connectors”, “commentators” or “spectators” in the digital world? “The digital behavioral composition of your target will guide what digital tools and website functionality your agencies need to provide,” Paquette said. 3. Determine where your target goes digitally. It’s critical to understand the basics of where to find targets in the digital environment. How much time do they spend online and on their mobile devices? What websites do they visit? Where are they most engaged and most receptive? What types of mobile devices do they own? Where do they go on their mobile devices? “Connect your target segment to the big media planning databases by including questions common to their survey and yours,” Paquette suggested. 4. Understand how your target tries to find you Where does your target frequently search? Do they use traditional search engines, YouTube, and social media? What keywords do they use when searching the category and your brand. It is not the same for all segments in the market. Do they prefer to learn about your brand from your website, social media, blogs, message boards or expert reviews? All these questions need to be answered as part of, or a follow-up to the segmentation survey, Paquette stressed. Navigating the plethora of new tools that are available today with a targeted strategy for the digital age will help ensure you obtain value from each and every segmentation study you conduct.

Eric Paquette is Senior Vice President of Copernicus Marketing Consulting & Research. Nancy Pekala is the AMA’s Director of Online Content and Editor of Marketing Researchers. Send your feedback about this article or suggestions for any of the AMA’s e-newsletters to [email protected]. Be sure to follow us on Twitter at twitter.com/marketing_power/rsrch

Marketing Researchers

3

November 2010