Market segmentation is not just a powerful tool; it is a game-changer. By understanding and addressing the diverse needs of consumers, businesses can tailor their products, services, and marketing strategies to specific clusters of consumers, resulting in a significant boost to their bottom line. However, effective market segmentation goes beyond just number crunching and analyzing data. It demands foresight, design thinking, and skillful storytelling—elements that infuse an artistic flair into this scientific approach.
Foresight: Staying Ahead of the Curve
Consider how fast markets and consumer preferences have evolved in recent years. The pace of change is unprecedented, and businesses have to adapt to consumers’ behaviors and expectations to keep up. Existing market segmentation profiles need to be revised; products and services must be refined and sometimes completely reimagined. Today's businesses need to ensure that their market segmentation is future forward, anticipating trends and reflecting consumers' unmet and emerging needs. Spotting these emerging trends soon enough to be proactive about them requires keen observation and an open, creative mindset. By incorporating future-forward segmentation, businesses can stay ahead of the curve, meeting, and exceeding consumer expectations.
Design Thinking: Unearthing Hidden Needs
In today’s business environment, a segmentation should allow businesses to gain an in-depth understanding of consumers so they can better meet their current and future needs, and effectively market and communicate to them. Often, however, consumers are unaware of their needs until they experience a solution. For example, ten years ago, few could have predicted the multifaceted role
smartphones play in our lives today. Uncovering unmet needs is an art indeed!
Design thinking allows businesses to delve deeper into consumer experiences, challenges, and aspirations, potentially uncovering latent needs that consumers themselves may not articulate. This human-centered approach ensures that solutions align with user desires and pain points. At this stage, Advanis uses human-centric qualitative methodologies to reveal this empathetic view, driving innovation and enhancing business results. By translating these hidden needs into actionable insights, our clients can better serve their customers and improve their bottom line.
Advanced Analytics: The Rigor of Science
With a multitude of algorithms available, choosing the right one to handle the characteristics of the data at hand requires scientific rigor. Understanding each algorithm's potential and limitations is crucial for uncovering insights that might otherwise remain hidden in large datasets. The combination of advanced analytics and creative problem-solving reveals the true power of market segmentation.
Storytelling: Bringing Segmentation to Life
Selecting the right algorithm is just the beginning. The real creative magic happens when compelling storytelling and visual aids bring segmentation to life. Creatively crafting narratives brings relatable and engaging personas to life. This allows stakeholders to understand and buy into the segmentation, breathing their characteristics in product and service development, customer service, and market strategy.
Advanis: A Legacy of Excellence
For over thirty years, Advanis has been at the forefront of market segmentation, combining cutting-edge analytical tools and experimentation with foresight and design thinking methodologies. Our human-centric segmentations have proven to drive better business results, helping our clients grow and evolve.
Two examples where we drove positive business growth outcomes:
Case Study: Retail
The Challenge: Our retail client’s brand had inherent equity with small businesses. However, they needed to respond to rapidly changing small business needs, driven by major changes in market dynamics. Their strategic goal was to become the go-to resource for small businesses by expanding their product and service offerings, but they needed a clearer perspective on this evolving market to achieve their goal.
Our Approach: Advanis used a multi-phased approach, starting with secondary research and in-depth expert interviews to identify major trends in the small business environment. This set of trends formed the framework for the remainder of the analysis. We then employed mobile ethnography and asynchronous discussion boards to identify unmet and emerging small business needs and develop prototypical personas. A subsequent quantitative survey validated the personas and quantified their needs, resulting in a forward-looking needs-based market segmentation with six key segments and major innovative opportunities for our client to serve each segment.
The Outcome: Our client revamped their brand personality and messaging, revitalized the products line-up and services offerings, and strengthened their marketing strategy, becoming a leader in addressing small business needs.
Case Study: Provincial Government
The Challenge: Our client wanted to launch an initiative to build the local market for the province’s foods. The effort would support local farmers, fishers, and food processors in capturing increased market share. However, limited information on consumer behaviors and motivations for food shopping (and local food choices) made it difficult to develop an effective action plan.
Our Approach: Advanis conducted an extensive three-phase study, starting with secondary research to identify trends affecting consumers’ eating habits and how these trends and drivers might impact the industry in the future. We then conducted a quantitative survey and created a segmentation using advanced analytics to identify key consumer segments. Finally, qualitative research was used to create detailed personas. We identified the opportunity for local agrifood and seafood industries within each segment; and profiled each of these segments to create personas of needs and expectations.
The Outcome: Our client developed an educational program to support local producers, helping them capitalize on the growing demand for local agrifood and seafood products.
By integrating the art and science of market segmentation, Advanis helps businesses unlock new opportunities and achieve lasting success. Let us help you navigate the complexities of market segmentation and transform your business today.
Learn more about our segmentation approach. Email Adriana, or read more here.