Segmentation-Coraggio

UNDERSTANDING CUSTOMERS Customer Insights and SegmentationCoraggio C29:30 - 12:30 Friday 12th Aug, 2011

AGENDA

9:30 - 9:50 Stimulation Keynote

9:50 - 11:00 Working session (Qualitative and Quantitative focus)

11:00 - 11:30 Break

11:30 - 12:30 Stump the Strategist session. Your chewiest marketing challenge solved live in 9 minutes.

Link to me on LinkedIn (Ashton Bishop) and you can download this presentation

Can you make the ball move

from being in front of the cube,

to inside the cube?

NECKER CUBE

RTA ‘PINKIE’ CAMPAIGN: AN INSIGHTS CASE STUDY

Source: (2009) “Roads and Traffic Authority: Speeding. No one thinks big of

you”, 2009 Australian Effie Awards.

Segmentation ChecklistBe targeted - media money box Only as useful as it is usableDon’t waste money on researchFocus on what makes the difference Segmentation. Research. Insights

Why bother with all this brand business anyway?

Why bother with all this brand business anyway?

Because if you get it right people will love you for it!

We’re hardwired to notice only what’s different

FUSING FUNCTIONAL AND EMOTIONAL BENEFITS

+

47 TV commercials that had an emotional benefit scored higher than 121 TV commercials with only a functional benefit

=

CONSUMER WORK SHOULD ONLY BE HELPING US

Make sure we’re speaking to the right people - quantitative

Talk to them in the right way - qualitative

SEGMENTATION

Focus marketing efforts where they have the best chance of success

Build on the success of other companies' products

Increase profitability through increased customer loyalty and higher prices

Increase the efficiency of money spent for marketing activities

Find growth opportunities

KEY BENEFITS OF MARKET SEGMENTATION

TARGETING AND SPILLAGE

The ‘alienation’ test


A:

bullseye


B: secondary


A:

bullseye


Baby Boomers(1946-1960)

Generation X(1961-1980)

Generation Y(1981-2001)

Generation Net(1995-...)

http://www.dhss.mo.gov/LPHA/New2008MCHI/GenerationalDifferences_Worksheet_GalenHoff.pdf

DEMOGRAPHICS - OLD SKOOL



ADOPTION OF INNOVATION MODEL

find a nicer version

Rogers Adoption Innovation Curve

SOME COMMON SEGMENTATION Methodologies and Models

Mosaic Geo-tribes Nielsen - Panorama Roy Morgan segments - Asteroid

SOME COMMON SEGMENTATION Methodologies and Models

Mosaic Geo-tribes Nielsen - Panorama Roy Morgan segments - Asteroid

Attitudes

Demographics

Age

Gender

GeographySocio-economic

EducationWealthCareeretc.

Beh

aviou

rs

BEATING THE JARGON

We’ll be looking at our segmentation tool today

RESEARCH

“If I had asked people what they wanted, I would’ve built a faster horse”

- Henry Ford

“You can’t just ask

customers what

they want and then

try to give that to

them. By the time

you get it built,

they’ll want

something new.”

“There’s an old Wayne Gretzky quote that I love. ‘I skate to where the puck is going to be, not where it has been.” And we’ve always tried to do that at Apple. Since the very, very beginning. And we always will.”

RESEARCH STRATEGIES

Trends - experts, technological changes

Culture - pop culture, style, fashion

Cross-Industry - influences from parallel

industries, developments etc.

Depth (insight) - Qualitative analysis - groups,

interviews, observations, ethnography

Breadth (quantitative) - online, omnibus, Roy

Morgan data

Con

text

Con

sum

er

MODULAR QUESTIONNAIRE

Research can be a relationship builder

Always start with those closest to your brand

Download from my LinkedIn profile

INSIGHTS

“Most marketers use research like a

drunk uses a lamp post, for support

rather than illumination.”

- Bill Bernbach

DISCUSSING INSIGHTS

DISCUSSING INSIGHTS

but first, who’d like to see a picture of my testicles?

OK, but WHY do that?

Yes, the unthinkable!

INSIGHT VS. INFORMATION

Insights are a perspective on

information that means you will never look at the

information the same way again

Information is primarily data that

comes from observations

INSIGHT VS INFORMATION

Insights give a deeper understanding, getting you closer to the result you are after. In marketing terms:




Usually...to deliver the most relevant and

persuasive message to your customers



or simply...to better understand their needs,

behaviours and motivations

Usually...to deliver the most relevant and

persuasive message to your customers

You’ll probably never forget an insight:

• Remarkable examples

You know where my commitment lies:

• To powerfully educate vs. offend

INSIGHTS GLEANED?

You’ll probably never forget an insight:

• Remarkable examples

You know where my commitment lies:

• To powerfully educate vs. offend

A doctor would probably have gleaned a whole different level of insight, which is an insight within itself

INSIGHTS GLEANED?

WHY ARE INSIGHTS IMPORTANT?

Insights are fuel for thinking

E.g:

In the singles division of a knock-out tennis tournament there are 111

entrants. The organiser wants to calculate the minimum number of

matches that must be played. What is this number?

1

DEFINITION OF INSIGHTS

Total Matches111

56

28

14

7

4

55

28

14

7

3

2

win

Simply...

There must be 110 eventual losers and one winner.

Since each loser can only lose one match there must be 110 matches.

APPENDIX

BABY BOOMERS

Born 1946-1960, after World War II

Grew up during the 1950’s, 60’s and 70’s

Entered the workforce when unemployment was high - late 60’s to early 80’s

They remember starting at the bottom and working their way up

They are today’s ageing workforce

Through the Ages, Business Review Week, Dr Roslyn Sayers 2008

Baby Boomers Generation X

Generation Y Generation Net

GENERATION X

Born 1961-1980

Grew up during the 1970’s and 80’s, entering the workforce in the 80’s and 90’s

Were influenced by increase in number of divorces, single-parent and dual income situations

Generally well-educated with majority having had a tertiary education

Highly influenced by the 90’s technology boom with the increasing popularity of the PC and Internet.

Stay loyal to themselves only and have a tendency to change jobs frequently, with many involved in starting their own businesses

Today they are faced with the demands of managing work and family commitments




GENERATION Y

Born in 1981-2001

Grew up during the 1980’s and 90’s and entered the workforce from the 90’s up to the current day

Are generally either working or studying at school or university

Influenced by technology and are highly impatient, expecting everything to be instantaneous

Are characterised for holding several jobs at one time and consider holding a job for more than 2 years to be a long time

Generation Y is aware of globalisation and is concerned with global issues such as climate change and sustainability




GENERATION NET

Born 1995 and beyond

Are growing up in the 1990’s and 2000’s

Will enter the workforce from around 2010-2020

Have grown up with technology such as mobile phones, internet

They expect everything to be instantaneous

They generally have an extremely short concentration span



GENERATION NET

Before they turn 25 the Net Generation will have:

Spent 10,000 hours gaming

Sent 200,000 emails and Instant Messages



GENERATION CThe GENERATION C phenomenon captures the an avalanche of consumer generated content that is building on the Web, adding tera-peta bytes of new text, images, audio and video on an ongoing basis. The two main drivers fuelling this trend?

(1) The creative urges each consumer undeniably possesses. We're all artists, but until now we neither had the guts nor the means to go all out.

(2) The manufacturers of content-creating tools, who relentlessly push us to unleash that creativity, using -- of course -- their ever cheaper, ever more powerful gadgets and gizmos. Instead of asking consumers to watch, to listen, to play, to passively consume, the race is on to get them to create, to produce, and to participate.

More than just age based segmentation, a behavioural segmentation like Generation C is sometimes useful. Also look to the Technographic profiling available on the Forrester research site to see how your audience might be using technology.

http://www.trendwatching.com/trends/GENERATION_C.htm



RESOURCES & REFERENCES

www.surveymonkey.com

www.mediasmart.com.au/go/

audience-targeting

www.whatismarketfind.com.au

www.abs.gov.au

05: RECOGNISING YOUR CUSTOMERS

WHY YOU NEED IT AND HOW TO USE ITOne of the biggest mistakes that businesses

make is trying to speak to too many people.

The tighter you define your customer

audience the more relevant you can be

to that audience, with both your selling

messages and your advertising spend working

together.

It means more efficient and effective

marketing; and getting higher value from each

customer.

COMMENTARYDon’t worry if this one audience does not

cover all your customers. Advertising 'spillage'

means if you target a tighter audience your

message will still ‘spill’ over to the other

people who might buy from you. However,

if you fail to recognise your best customers

and start off too broad you might miss

your best prospects completely.

If you define your audience too broadly, it

will not help you prioritise the things you

need to do to contact them. Conversely, if

you define them too narrowly there might

be too few people to allow you to achieve your

business goals.

OUR EXAMPLE:

DIMENSION PRIMARY

Naming them Ambitious Owner/Operators.

Describing themThey own their own business and have big plans for the future.

They need their marketing skills to match their ambition.

Demographics 70% male, 30% female 30 - 50 y/o.

What do they think?

Ambitious, hard working, looking to “make it”.

Take pride in their business. See the potential power

of marketing. Desire commercial gain. It’s time for a step

change!

What do they do?Investing in business growth. Spending (or willing to spend)

on marketing and communication each year.

What’s important to them

when buying?

They want confidence that there will be a return on their

investment. In the past some of them have been burned by

products or services that don’t leave them with clear actions.

They look for credibility, experience and practical advice.

Where to find them?

Chamber of Commerce meetings, CEO networks eg. The

Executive Connection. They know other business owners, so

referrals are important.

How few do you really

need to grow? How many

of them are there?

Given the recycle rate and business growth cycle, we need

about 30 new clients per year. This complements our existing

base of customers.

How often do they buy?

How much do they spend?

Maximum of once per year, but often once every couple of

years for Coached Marketing Workshops. Ongoing project

work (campaigns) 2-3 times per year.

12

DIMENSION DESCRIPTION PRIMARY SECONDARY

Naming themA handle that helps you identify and talk about them

eg. young aspirational females.

Describing themThink about their age, gender, wealth, education level

and where they live.

What do they think?

What are their attitudes and beliefs? This might be in

relation to your product, the category you’re in or just to life

in general.

What do they do?

What activities do they undertake? This might be their

typical job, their routines or hobbies and general

recreational activities.

What’s important to them when buying?

What sorts of things do they look for when purchasing?

How important is price and quality, and what other factors

do they look at?

Where to find them?

If you wanted to talk to them how would you find them?

Where and when might they be open to information about

your product, service or category?

How few do you really need to grow?

Given your growth objectives for the next year, how few

customers do you really need to talk to? It’s hard to

convince people to buy, so you want to focus on the

people you really need for growth and talk to them many

times. It’s generally a trade-off between numbers of people

contacted vs. number of times contacted per person.

What’s more important?

What's their customer life-time value?Are they heavy users? How often do they buy? How much

do they spend? How many years will they be shopping in

your category?

Other discriminators:

YOUR MISSION

WHERE TO STEP UP

COMPETITIVE ENVIRONMENT

CUSTOMER INTERROGATION

VALUE STATEMENTS01 02 03 04 06RECOGNISING

YOUR CUSTOMERS05

Segmentation-Coraggio

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