Innis Maggiore — One of the Nation’s Top Market Segmentation Companies
You might find that headline a bit alarming …
As the nation’s leading positioning ad agency, market segmentation is at the heart of positioning.
How can an agency in Canton, Ohio claim to be one of the nation’s top market segmentation companies? Simple answer: Positioning. As the nation’s leading positioning ad agency, market segmentation is at the heart of positioning. We have to be experts in market segmentation or we wouldn’t claim we’re #1 in positioning.
Our Appreciative Discovery® process involves a 4-C filter, and one of those four Cs is Customer. Innately, positioning strategy has both the customer and the competition at its core. But unless you define your customer, you can’t really define the competition. And that’s where market segmentation plays. Your position has to be an idea that maximizes your relevance to a target market while separating yourself from competitors and competitive ideas. Not everyone has sensitive teeth, but that niche is big enough to keep Sensodyne on the shelves. Not everyone wants a performance car, but there are enough people who buy BMWs to keep them in business. Inherently, staking a position means you’ve selected your audience. But, even your specific customer set has diverse needs and that’s where market segmentation becomes more granular.
How do we segment your target markets?
To start, we think about market segmentation in four basic categories:
- Demographics: these refer to statistical data that describes the characteristics of a population, such as age, gender, income, education, and ethnicity.
- Geographics: self-evident. These refer to the physical location of customers.
- Psychographics: these refer to the study and analysis of personality traits, values, attitudes, interests, and lifestyles of a particular group or population. The goal is to understand the underlying psychological and behavioral factors that influence consumer behavior and decision-making — in other words, why do they buy what they buy.
- Firmographics: These refer to the characteristics of a business or organization, such as industry, size, revenue, and ownership structure. Similar to demographics, which are used to describe the characteristics of individuals, firmographics are used to understand the makeup and trends of businesses. Our B2B clients especially want to understand the firmographics of their target audiences.
By dividing your customers into segments, you don’t change your position, but you may slightly alter how you dramatize it to them. And for those with sales teams, it’s best if they sell to your various segments based on their hierarchy of needs. Intimately understanding your target markets ensures your position is appropriately dramatized to each segment.
While it used to be enough to spout product benefits and features, with the increase in marketing in the 1920s, options arose which gave customers choices. Gone were the days of a single consideration in any product category. Remember Henry Ford’s classic line, “Any customer can have a car painted any color that he wants—so long as it is black?” In the 21st century, advertising clutter won’t allow you to think single-mindedly.
Innis Maggiore is one of the top market segmentation companies because we maintain our philosophy that positioning strategy is the best business strategy. If you need help identifying your target markets, contact us today.
Why use market segmentation?
Market segmentation helps you set priorities — in messaging, product development, advertising, public relations, sales, and more.
There are few global companies who can afford to mass market, and even they spend millions of dollars in research each year to understand and identify their market segments. No one, even P&G, has unlimited resources. Market segmentation makes each marketing dollar go further.
In fact, P&G has perfected the discipline of segmentation. Did you know they sell five products in the laundry detergent aisle alone? Tide, Cheer, Gain, Downy, and Ivory! Why? Because they are marketing to various segments. They want to own the laundry detergent market, but they don’t try to do it with a single product. Instead, they have identified the wants and needs of different segments, and created and marketed a product for each of them. Interestingly, each of those five brands have their own marketing teams and budgets.
We know you aren’t P&G, but that makes it even more important for you to spend your marketing dollars wisely. Finding your position is step #1. Dramatizing it to each target market is step #2.
One more benefit — building brand loyalty
As marketers, we tend to focus on acquiring new customers, and that should be job #1.
But keeping a customer is far cheaper and easier than creating a new one. The value of market segmentation beyond creating a customer is that it provides you more data points about why customers return. If you knew that a certain segment of customer was more likely to be a repeat purchaser, wouldn’t you want to focus on creating these new customers before chasing others that might be switchers?
When we worked with Microsoft in the early 2000s launching their MSN7, MSN8, and MSN9 internet service, we constantly tested, optimized, and tested some more. What we found was that it wasn’t the offer that made customers stick, but a certain type of customer that tended to be more loyal. The offers were typically 3-, 6-, and 12-month trials, and the churn rate was incredibly high until we discovered the right market segment that would stick with products that deliver. When we dialed this in, the retention results were far better.
Therein lies the power of market segmentation: create customers for the least amount of marketing dollars who are most likely to stick.
By focusing on specific target markets, businesses can often achieve better results with their marketing efforts, as they are better able to connect with potential customers and meet their specific needs and preferences. This can ultimately lead to increased sales, improved customer loyalty, and a stronger competitive position in the market.
If you want to engage with one of the top market segmentation companies in the market, contact Innis Maggiore and we can provide you with details of our Appreciative Discovery® process and how we work with you to identify your ideal target markets.