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Lou Lasday: Strategic Segmentation: One Size Doesn't Fit All
"Segmentation" is the realization that markets are not monolithic! Instead, they consist of submarkets with basically similar dynamics that may respond to offerings from similar firms in a totally dissimilar manner. So how can this critical strategic marketing initiative dramatically benefit your Gulf Coast enterprise? First, let's un-complicate the seemingly complicated.
The classroom
Let's look at little kids in a grade school reading class. They all wear the same color polo shirt with the school name neatly embroidered on the pocket. The little people are all smiling, of the same age, fun-loving and with minds in various stages of the ready position. All are gathered together for the same purpose.
Regard this as a student market microcosm with basically similar dynamics. The eager teacher can certainly try to reach them all in the same manner. In fact, unfortunately, too often that's what happens.
Assume, however, as in a sub market, there are variables in play here. One-third of the class reads at a lower remedial level, one-third at an average grade level and one-third at an advanced placement level.
Here you can see both the basic similarities and perhaps the dissimilar responses. So, how does the teacher reach them all with the same message? Here's a hint: She can't! Further, she should not.
The board room
The first step in a segmentation study is to decide which basic variables to use. Admittedly, your senior management will never say, "Let's do a segmentation study" and yet, regardless of how it is phrased, your everyday discussion asks, "what can we do to gain a better understanding of our markets"?
Once you acknowledge that you do indeed have sub markets, the target segments selected must meet several criteria for the entrepreneur to use them successfully.
First, it must be of sufficient size to justify the experience for market efforts to serve it. Second, it must also be clearly distinguished from other segments in your population. Third, it must be accessible to the firm's normal promotion and distribution methods. And finally, they must be compatible with your resources and expertise.
The warehouse sale
Pick any Gulf Coast business classification. Assume for a moment you are a land developer or commercial Realtor with a million dollar warehouse building to market. Consider what would motivate a buyer.
You really don't care who buys the property; at least within reason. What message would motivate a newly formed stocking distributor requiring space with near term expansion possibilities? Now, how would your message be different for an established mature business? Or, how would you "talk" to a non-user investor?
These are sub markets and the messages to entice them may be entirely different. Do you use the same newspaper to reach all prospects? The same sections? And how do you use mailings?
Bank on us
Now, let's look at the community banker. Do you see the same segmentation opportunities?
Conceivably, the audience or segment for an auto loan, small certificate of deposit or passport account may be everyone. But how do you reach the Big Boys - those who need multiple banking services, large secured borrowings, major deposit programs, brokerage, wealth management and more? That's the challenge.
One idea is to find out where they live. Find them by income-level readership. Find them by zip code. Find them by targeted publications. Stay away from low-income readership of daily metro newspapers. Reach them by multiple messages.
Special interest groups
Regardless of your industry classification - law, financial, real estate, home building, hospitality, or other professional service organizations, you have diversified interest groups (sub markets) that comprise the whole of your market. Identify them. Categorize them. "Talk" to them in their terms. Specialize in them. Profit from them.
Unleash this dynamic in marketing communications. Recognize that like kids in school, we are really not all the same. We react at different levels to varying needs, hopes, dreams and frustrations, in trying to get a read on major products or services we want. Take the time to dig a little bit below the surface and you may just hit pay dirt!
Lou Lasday, an independent marketing advisr residing on Longboat Key, creates action-oriented strategic marketing initiatives for Gulf Coast emerging companies. A career direct response executive, he has been a general partner of a national marketing communications firm and regional president of the American Marketing Association. Lasday can be reached at [email protected]
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