Segmenting A Market

Here's a standard procedure for performing a segmentation analysis to develop a marketing strategy:

* Clearly define the marketing objective.

* Develop an initial segmentation using the marketing objective to guide the selection of the primary segmentation variable.

Example: If sales growth is the objective, sales should be used as the first cut at producing a segmentation.

* Develop sub-segmentations, i.e., segment the segments. And then profile each segment:

--Who are they?

--Where do they live?

--How can they be reached?

--What do they buy?

--What are they worth?

* Identifying important subsegments in terms of the profile variables.

* Repeat the process until no more meaningful groups are found.

 

* Create an appropriate marketing strategy.

* Develop customized programs for each subsegment based on their profile characteristics.

* Test and track results.

* Refine as necessary.

(Source: Smart Business Supersite)