I
5 Characteristics of meaningful member segmentation
Marketing leaders know that market segmentation helps improve messaging, product positioning and results. With so many options out there, how do you evaluate whether a particular segmentation approach or schema will work for you? In her Harvard business review article, “what you need to know about segmentation” Gretchen Gavitt defined some key characteristics of “meaningful” segmentation that you many find helpful.
- Identifiable. You need to be able to identify which members fall in each segment and measure their characteristics, like demographics or usage behavior.
- Substantial. The segment needs to be large enough make sense to target. It is interesting to note that what constitutes “substantial” has changed over time as personalization tools become more ubiquitous. The decision around sizing segments is now driven more by the ability to tailor solutions to groups than being able to reach them.
- Accessible. You need to be able to reach the people in the segment in some way in order to communicate or interact with them.
- Differentiable. Segments should be distinctive enough that different segments will react differently to the same product or marketing mix. If they don't, they are not different segments. For example, Spirit airline has little to offer the international business traveler. Good segmentation allows you to tailor your product, benefits, distribution, price or brand message to maximize their interest.
- Durable/Actionable. The characteristics of the segments need to be somewhat stable so that you can create and provide products or services that are meaningful to those people. Some segments may not be actionable for Credit unions. For example, members of the uber wealthy “Power Elite” segment as defined in the Mosaic segmentation model are regularly courted by brokerage firms and trust companies that provide exclusive products and perks that credit unions cannot offer.
