ENT4122 Customer Segments PDF

ENT4122: Go to Market Strategies Customer & Buyer Personas Customer Segments Customer segmentation is critical to providing the right benefits to the right customer. - Unfortunately, many entrepreneurs define their customer segments too broadly and then wonder why they are only c...

ENT4122: Go to Market Strategies Customer & Buyer Personas Customer Segments Customer segmentation is critical to providing the right benefits to the right customer. - Unfortunately, many entrepreneurs define their customer segments too broadly and then wonder why they are only capturing a small portion of the segment. Why Customer Segments Matter? Tailored Value Proposition - By identifying and understanding the specific needs, desires, and pain points of each customer segment, you can tailor your Value Proposition to meet their expectations. Market Fit - Your product or service satisfies the needs of a specific group of customers. - Identifying your Customer Segments helps you narrow down your target audience and focus your resources on delivering what that segment truly wants. Examples of Customer Segments Digital Marketing Company - Customer Segments might include small businesses, mid-sized enterprises, and large corporations. - Each segment has distinct needs and budgets. E-commerce Store - Segments could consist of individual consumers, resellers, and corporate buyers. - The shopping behavior and expectations of these groups differ significantly. Healthcare Clinic: - Customer Segments could be defined as pediatric patients, adult patients, and senior patients. - Each group requires specialized medical care and services. Demographic Segmentation Divides markets based on such characteristics as: - Age - Gender - Income - Education - Marital status - Family size Age and gender are the most commonly used demographic variables Geographic Segmentation Divides markets into groups such as nations, regions, states and neighborhoods. Marketers pay special attention to local variations in the types of goods and services offered in different geographic regions. Allows marketers to capitalize on convenience to the customer Behavioral Segmentation Categorizes customers based on what they actually do or how they act toward products. Behavioral segmentation variables include usage rate, loyalty, and occasions (e.g., a wedding or business trip) - 80/20 rule – suggests that 20 percent of very loyal customers account for 80 percent of their total demand. When done well, behavioral segmentation helps explain the benefits sought by different consumer segments - Most difficult to assess since the marketing research required to track and understand how consumers is very expensive and time-consuming Psychographic Segmentation Relies on the science of psychology and demographics to: - divide markets and understand what influences purchasing behaviors and - segment consumers. Psychographic characteristics help us to understand what influences those segments’ purchasing behaviors - For example, certain psychological or personality traits When marketers segment based on psychographics, they divide the market into groups according to the reason consumers purchase products - Lifestyle Segmentation - A variable of psychographic segmentation that divides people into groups based on their opinions and the interest and activities they pursue. Customer Persona Out of the primary research will come a complete profile of the customer in great detail; that is, a description of the primary customer, be it a consumer or a business. The profile is critically important to the eventual marketing strategy, because it provides information vital to everything from product/service design to distribution channels and the strategy to attract the customer.  Customer Persona The customer you are empathizing with should be a real person with a - Name - Age - Status - As many demographic details as possible source: Fine Homebuilding Customer Persona Exercise Get in groups of 3-4 Complete a customer persona for the person you are given - Name, age, job, education, location - Lifestyle Details: Are they married? Kids? - What are their needs and wants? - What are their problems (frustrations and obstacles)? - What product or service could we offer to help solve their problem? 1 2 3 4 54 64 ?? ? In-Class Assignment Canvas Module 6 -> In Class Activity: Buyer Persona Worksheet Conclusion Professor Roberts Email: [email protected] Office: 144 RSB 1 2 3 4 5 6 Customer Segment Markets Existing Markets - Historical - High competition - Consumers are relentlessly pursued - Established Brand (recognition) Re-Segmented Markets - Created by gaps left by mass marketing - Think electric vehicle market segment - Niche market - Example: Broad: music >> Re-segmented: pop Customer Segment Markets New Market (Disruptors) - No customers yet - Forecasted but not yet validated - Little or no competition...yet - Early adopters >>Help to gain traction Clone Market - Concept that works elsewhere - Will it transplant? - Example: European neighborhood coffee shops >> Starbucks Upcoming Dates In-Class Activities In-Class Activity – Friday, 9/20 Quiz #2 (Chapters 3 & 4) – Friday, 9/20 Conclusion Professor Roberts Email: [email protected] Office: 144 RSB 5 4