The market segmentation strategy seeks that businesses know the characteristics of customers well when consuming a certain product or service. So this allows them to offer them what they really need.
It seeks to get companies to focus on a few target markets instead of trying to sell to everyone. Thus achieving a competitive advantage in a certain and specific segment.
This is a strategy often used by small businesses or start-ups, as they often don’t have the resources to engage the entire audience.
Sometimes the competition is so great that large companies also specialize in one market segment. Companies that use this method often focus on customer needs and how products or services could improve their daily lives. Remember this when planning your content calendar for the month.
Types of market segmentation:
Creating the aforementioned strategy presents different types of segmentation. Therefore, among the types of market segmentation, the following should be highlighted:
Product segmentation: Product segmentation takes into account the specifications of the product. Trying, depending on how specific your segmentation is, to reach the target customer through said segmentation.
Segmentation by use of the product is the segmentation of the market by means of the product, being one of the most common. It may consist, in some cases, of offering similar or completely different products through different brands called “second brands”. Product usage targeting is extremely popular and effective. Its indices are usage rate, awareness status, and degree of loyalty.
Segmentation by industry: This type of segmentation helps us to better understand the sector in which we focus. Depending on the sector we focus on, the competition will be greater or less. For this, it is important to know what our competition is and what their products are. In this way, being able to know which products penetrate better and which penetrate worse.
In the industrial market, unlike the consumer market, marketing strategies must be focused on a particular group of organizations that in turn provide services and products to other companies or people; The variables by which an industrial market is segmented must consider the comprehensive knowledge of its customers, but also the knowledge of its customers’ customers, who are actually the ultimate goal of industrial processes.
Geographic segmentation: Geographic segmentation is a very important type of segmentation. Well, the geographical location in which the objective profile is located is taken into account, as well as the physical space in which he develops his life. And this is very important, depending on the type of business you have.
Geographic segmentation refers to the division of the market taking into account the geographical differences between one place and another, when distributing products or services. This type of segmentation helps to collect and analyze information according to the physical location of people. For example: It will affect a local restaurant with delivery much more than a virtual store that ships worldwide.
During this segmentation phase, it is important to know the environment to which our product or service is directed so as not to carry out work in vain.
Demographic segmentation: This type of segmentation is one of the most important when it comes to focusing our sales strategy. During this segmentation phase, statistics can be made with variables such as age, marital status, profession, sex, educational level of the potential client and other more specific aspects.
All these variables have a fundamental value to carry out the strategy successfully, as well as to focus our product or service well.
Behavioral segmentation: The concept of behavioral segmentation refers to the division of the market based on consumer behavior. Customers’ attitudes, knowledge, reactions, and uses of a product define behavioral segmentation.
Many of us marketers believe that the best starting point for segmenting a market is behavioral segmentation. It is used by companies to build loyalty to brands or products and encourage their purchase.
Behavioral segmentation is the segmentation process in which variables that have to do with the behavior of users are analyzed.
Therefore, we refer to variables that, such as consumption patterns or the sensitivity of a certain audience to the price level, have great value for the company that seeks to introduce its product in a certain market.
Psychographic segmentation: Psychographic segmentation takes into account key psychological characteristics when segmenting users or buyers for our service or product.
It seems strange, we know, but in this way, the variables that are analyzed are variables such as personality, values, interests, preferences or lifestyle. And these variables allow us to adapt our service or product to certain expectations that the client has.
Psychographic market segmentation is carried out primarily on the basis of “how” people think and “what” they want their life to be. Any organization trying to understand the thought process of its consumers can divide its target market according to this segmentation method.
Socioeconomic segmentation: Socioeconomic segmentation takes into account variables such as disposable income, purchasing power, standard of living, wages, as well as another series of variables that allow us to know how high the purchasing power of our clients is.
Certain types of products will only be consumed by certain social classes. The upper classes seek to distinguish themselves from the middle classes; So offer them exclusivity. Create a narrative that places your product at the pinnacle of distinction. And do it in a subtle way, with an advertisement aimed at the upper class that is visible to the entire population, it will reduce the distinctive power of the product, and it will lose charm for upper class individuals. Search for events and places of interest for your target audience.
This segmentation is very useful for the company, since it allows knowing to what level the company can increase prices so that the final price is bearable by the target customers.