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Marketing segmentation

Contrary to Recent Events, Segmentation Is Not Dead

The marketing world is constantly in flux, and the latest trends can change quicker than the weather, so knowing how to stay on top of the game can feel like an impossible task. Only last week, we were told that segmentation is largely a pointless exercise!

While you might have heard of segmentation, and you might just think it's another buzzword marketers use to bamboozle you, that couldn't be any further from the truth. It's an approach that helps break down the wider market into smaller, more digestible chunks, making it easier for you to understand their needs, wants, and buying triggers, so you can tailor your digital marketing and drive better results.

How Segmentation Can Help Businesses Thrive

As you may have gathered, we're big fans of segmentation here at Royal Flush Marketing. Not only does it make it easier for us to understand who we're targeting, but it also opens doors that might not have otherwise been considered, giving us more opportunities to improve performance.

Here are just a handful of examples of how segmentation can help your business drive sustainable success.

Tailored Messaging: Hitting the Right Chords

By segmenting your audiences, you can craft bespoke messaging to appeal to their shared characteristics or behaviours. This type of messaging will appeal to their hearts as well as their minds, resonating with them on a more personal level.

This more personalised approach increases the likelihood of them converting by helping them relate to the product or service you're offering, rather than seeing a vague advert online with a loose but broad appeal. Customers like feeling special and listened to.

Competitive Advantage: Staying Ahead of the Curve

In a market where competitors are just a click away, segmentation offers a competitive edge. By catering to the specific needs of different segments, businesses can carve a niche, making it difficult for competitors to catch up, while having the flexibility to stay on top of emerging trends.

This tailored approach is what sets market leaders apart from the rest. By listening to customers, including those who buy from your competitors, you can make sure that your service offering can adapt in real-time, helping ensure you're always one step ahead of your competitors. Social listening tools are great for gauging social sentiments towards specific topics – Brandwatch, Pulsar, and Hootsuite are all worth looking into. 

Efficient Resource Allocation: More Bang for Your Buck

If budget is an issue, or you just want to operate as efficiently as possible, segmentation can help you get your costs under control. Rather than throwing a broad message out there and waiting to see where it lands, you can do your research and craft something that has a better chance of driving engagement.

We've found over the years that this is absolutely the case. Mass marketing can work for the very biggest brands that are already household names, but small and medium-sized businesses don't have this luxury. Every penny matters, and segmentation can help you reduce inefficiencies.

Improved Product Development: Meeting Customer Needs

Segmentation requires that you listen to your target audience and understand them not just from a consumer perspective, but also on a personal level. By doing this, you can adjust your offering to align with what your prospective audience expects, increasing the chance of them converting in the future.

If you can discover where you are falling short, or where your largest competitor might be pulling ahead, you can pivot and make meaningful changes. This agility will help keep customers happy, improving satisfaction and increasing your market share – as long as the price and value proposition are correct, you should see your revenue shoot up!

Increased Customer Retention: Building Lasting Bonds

The journey doesn’t end with acquiring customers; it’s about keeping them. A new customer may represent a smaller upfront benefit, but their continued purchasing will help provide you with stability and the ability to forecast well into the future, assuming their buying behaviour stays the same.

Segmentation fosters lasting relationships by ensuring that products and communications align with the evolving needs of different segments. Happy customers are loyal customers, bringing in more customers through positive word-of-mouth referrals, all while staying with you through thick and thin because of brand loyalty.

Is Segmentation Still Important?

The marketing world's perception of segmentation can change over time, and Mark Ritson is a key example of this, with his recent comments contrasting hugely with what he had to say on the topic back in 2016.

In 2016, Ritson defended segmentation and targeting as vital components of a successful marketing strategy. He advocated for a data-driven approach to identify and target specific market segments while also criticising the idea of "sophisticated mass marketing," which advocates for targeting everyone without considering distinct market segments. He voiced concerns about neglecting demographic indicators like age and gender in segmentation, arguing that these factors play a significant role in consumer behaviour and preferences​.

However, in 2023, Ritson argued that segmentation often becomes pointless due to the uniformity we can see happening. He criticised marketers for feeling obliged to include a segmentation section in every plan. He discussed the shift in the industry towards a more mass-market approach to targeting, driven by cost-effectiveness and broad reach for brand building. Nonetheless, he acknowledged the complexities involved in practising both broad reach for brand building and targeted activation for specific segments within the total market population​.

The shift in Ritson's perspective over the years reflects a broader segmentation discussion within the marketing industry. It suggests an ongoing evolution in marketing, influenced by the realities experienced by marketers, technological advancements, and costs associated with precise segmentation.

Help is Available

We're here to help you easily segment your audiences without outlaying considerable manpower or resources. While we'd always recommend working with a marketing agency to help make sure that your segmentation is accurate, we appreciate that not all businesses can afford this expense, which is why we create this content.

To book a free one-hour consultation, submit an online form or give us a call on 01492 463209.

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