Market Segmentation is an invaluable aspect of most marketing plans, it allows you to target a receptive group of people within the population, thus avoiding the shotgun approach as far as possible and maximising your return on investment. The ideal individual to advertise to is one who will buy your product. So how do you work out who this is and how to target them? Well after reading and going through all the blogs I’ve posted on consumer analysis and giving it some thought you should have a vague idea of the demographics of your target market.
With classical press advertising you would merely target your demographics by choosing your channels carefully, skateboard magazines where a good place to market products designed for teenage boys etc. This has somewhat flowed over into online marketing, in the most basic form it can direct your placement of paid ads on 3rd party websites or through Google’s Content Network especially when utilising the CPM option. Social media sites often allow for far more detailed and specific demographic advertising options. These can be utilised very efficiently if your product appeals to a neatly defined target market. Often the level of segmentation available with most social advertising platforms is quite mind-blowing. Facebook has a well evolved advertising system with a multitude of different dimensions to choose from ad can sometimes yield impressive ROI.
Of course pay-per-click (PPC) search, such as Google’s AdWords, advertising has revolutionarised market segmentation as we knew it as it allows you to only target those who are actually actively looking for your product – the ideal target market. Yet you need to know what you’re doing to squeeze every ounce of selectivity out of it, I’ll go into this at a later stage in another blog post.
For now let me give you a list of some of the commonly used segmentation strata:
- Geographic
- Demographic
- Age
- Gender
- Income
- Marital Status
- Family Life Cycle
- Education
- Occupation
- Ethnicity
- Religion
- Language
- Psychographic
- Lifestyle – Interests and activities
- Personality
- Behavioural
- Usage (different target markets may use your products for completely different uses)
- Purchase Occasion
- Brand Loyalty
- Responsiveness to Price and Promotion
Obviously not all of the above would be applicable in every circumstance, but for every target market you have go through the list and narrow down your market segment. Each different market segment should then be analysed as to the viability of the advertising options available and the ROI that it promises. With online marketing you can often experiment inexpensively, which really takes a lot of the guess work out of it.
Wikipedia has a pretty elaborate entry on Market Segmentation if you'd like to read more.
