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Segmentation is to Behavioral Marketing as Peanut Butter is to a PB&J

Peanut butter and jelly sandwich

Like a PB&J is not possible without peanut butter, behavioral marketing is not possible without an investment into understanding a company’s customers through segmentation.Segmentation is the foundation of behavioral marketing, but unless you are in the business of market research you may not understand how segments are derived and why the manner in which you derive them is important.

Of course, you can classify using a simple segmentation based on demographics (age, ethnicity, female/male) or by usage (heavy, light), but these rarely yield needed information.  In a true segmentation, people are typically grouped by how alike they are in terms of their behaviors and attitudes towards life or a particular topic.   This type of segmentation analysis is conducted by carefully constructing a questionnaire so that some questions are behavioral in nature and others attitudinal.

Results are then viewed by an experienced researcher, who identifies patterns in the data through the use of “cluster analysis.”  There are  multiple sub-types of cluster analysis (“algorithms”) that can be used to view the data from differing  vantage points, allowing the researcher to see the “stories” in the data.  From there, certain attitudinal questions are identified that yield the strongest differences, which are then used as the basis of behavioral analysis.

The resulting data cuts are then analyzed and clever segment names are created to represent different types of customers who share similar values or lifestyles.  For example, “Facebook Fanatics” or “iPhone Moms.”

Now the trick is…how to translate that customer knowledge into a marketing strategy that captures people’s attention at their interest points – their behaviors and attitudes.

A way that this data can be used is to evaluate which segments are worth pursuing through the creation of indices.  By looking at each group size, their spend levels, and how much the group likes the company/brand, it can be determined, for example, that segments 2, 3 and 5 are best to target.  They are the largest that spend the most and like the company/brand best.  Furthermore, we can look at their wants/needs and what they have in common with each other for marketing messaging.

As an aside, the company that I work with, C.A. Walker Research Solutions, regularly conducts segmentations for its clients, if you need assistance in this area.


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