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Current Issues in Marketing
SocioSphere= inter-relationships among social institutions, associations, reference & affinity groups
PsychoSphere= Identity, personal- perspective <<<Weltanshaung >>>
IDENTITY Derived/Defined by:
ERA
Generation
People, Places, Things, Organizations & ideas that we “identify” with…
Origins of our identity
Our individuality = result of Nature & Nurture
Our commonality = results from our shared culture & experience
War; civil unrest; social movements
Political persons & events; economic swings
Scientific/Technological discoveries & advances
Tragedies: Natural & Man-made
Entertainment: Movies, TV, Music; artists, celebrities
Clothing styles; Lifestyle trends, Fads
Come of age- Imprint on “Your-World”
Each generation molded by world events that occur during its formative years.
… distinct historical experiences create characteristics that stay w/ people thruout rest of their lives
Each generation molded by world events that occur during its formative years.
… distinct historical experiences create characteristics that stay w/ people thruout rest of their lives
Generational Marketing: Reaching the Hearts and Minds of ConsumersAnn A. Fishman, Circulation Management, Jul 1, 1998 http://circman.com/ar/marketing_generational_marketing_reaching/
Generational Marketing: Reaching the Hearts and Minds of ConsumersAnn A. Fishman, Circulation Management, Jul 1, 1998 http://circman.com/ar/marketing_generational_marketing_reaching/
Generational Life ExperiencesCalled “Markers”
Values are shaped by:
EventsCulturePoliticsEconomyTechnologyPersonalities
EventsCulturePoliticsEconomyTechnologyPersonalities
Generations Variously Named & Dated:
1. Matures – < 1946 2. Baby Boomer – 1946-1953 3. Generation Jones – 1954-1964 4. Generation Rerun – 1965-1975 5. Generation Xceptional – 1976-1986 6. Generation M – 1987-1995 7. Millennials – 1996 and beyond
1. Matures – < 1946 2. Baby Boomer – 1946-1953 3. Generation Jones – 1954-1964 4. Generation Rerun – 1965-1975 5. Generation Xceptional – 1976-1986 6. Generation M – 1987-1995 7. Millennials – 1996 and beyond
Depression cohort (1912 to 1921) WWII cohort (1922 to 1927) Post-war cohort (1928 to 1945) Baby Boomer cohort #1 (1946 to 1954) Baby Boomer cohort #2 1955 to 1965) Generation X cohort (1965 to 1976) N Generation cohort (1977 to date)
Depression cohort (1912 to 1921) WWII cohort (1922 to 1927) Post-war cohort (1928 to 1945) Baby Boomer cohort #1 (1946 to 1954) Baby Boomer cohort #2 1955 to 1965) Generation X cohort (1965 to 1976) N Generation cohort (1977 to date)
THE GI GENERATION: 1901-1924 THE SILENT GENERATION: 1925-1942 BABY BOOMERS: 1943-1960 GENERATION X: 1961-1981 GENERATION Y: 1982-PRESENT
THE GI GENERATION: 1901-1924 THE SILENT GENERATION: 1925-1942 BABY BOOMERS: 1943-1960 GENERATION X: 1961-1981 GENERATION Y: 1982-PRESENT
2
3
4
5
1927 1946 1965 1980
Millions
Senior/Silent
Baby Boom
Gen.X
Gen.Y
Source: U.S. Bureau of the Census
U.S. Generations:
Gen.Z
1995
Interval between Generations Decreasing &
amplitude/magnitude of change between Generations
Increasing
PEOPLE, PLACES & THINGS… MORALS, PRINCIPLES, HEROS
Disposable… Mobile…Transitory… Ambiguous… Androgynous… Fragmenting…Society
UP-Rooted by increased Choice & Conflict &
Challenge
IDENTITY ANCHORS
The New Psycho-Sphere
“It is though a bomb went off in our communal Psycho-Sphere.
We are, in fact, experiencing not merely the breakup of the Techno, Info & Socio-Sphere but the crackup of the Psycho-Sphere as well.”
page 365
A state of “shattering stress & disorientation
resulting from too muchchange in too short a
period of time”
FUTURE SHOCK
The
Law of Accelerating
Returns
progressing in
exponential fashion
Presidents Commission on Mental Health
Reports - fully ¼ of US citizens suffer from
some form of severe stress
National Institute of Mental Health
researcher..
declares “psychological turbulence” is rampant in
American society--is divided & anxious
about the future..
Here Yesterday-Gone TomorrowHere Yesterday-Gone Tomorrow
“In industrial era: Americans had layers of belonging- Nuclear & extended family;
union, associations; church, charity & community service; the job…
-- much of this is in decline… So much of what we cherish,
what Americans like to call "the good life" has been
stripped away at the end of the industrial age”
• 46 % of Millennials see religion as the "key to the nation's success”
• as opposed to 64 % of Generation X• 69% of Boomers• 78 % of the Srs (ages 66-83)
The Loss of IdentityThe Loss of Identity
In 2nd wave society- Identity very much tied
to job-title. “Company marques &
hierarchy pegs tell us who we
are & where we belong”
In 2nd wave society- Identity very much tied
to job-title. “Company marques &
hierarchy pegs tell us who we
are & where we belong”
2nd W
ave
“With increased mobility & job turnover there is:
A loss of “Place” –losing ties to family & community…
A fear of losing the sense of self, the tie to job and work”
A loss of “Place” –losing ties to family & community…
A fear of losing the sense of self, the tie to job and work”
Where is identity in an American job that was torn up … by multinationals… seeking efficiency
Where is identity in an American job that was torn up … by multinationals… seeking efficiency
instead of the town square… all life gravitates to a consumer temple-city we call the shopping mall?
instead of the town square… all life gravitates to a consumer temple-city we call the shopping mall?
For Senior Generations Fully developed 2nd wave Psyche
before 3rd Wave
The 2nd Wave Psyche
A Nuclear Family
Work- 9-5
Well Defined Roles Clear lines
of Status
Clear lines of Authority
• Sense of Community
• Structure• Meaning to/of
Life
Values & Lifestyle
The 2nd Wave Psycho BreakdownThe 2nd Wave Psycho Breakdown
1. “The sudden shift of social ground rules
2. The smudging of roles, status distinctions & lines of authority
3. The immersion in blip culture4. Above all the break-up of
indust-reality
Have shattered the world image most of us carry around in our skulls”
Toffler, 3rd Wave, p.374
“w/ so many of our habits, values, routines &
responses called into question,
it’s hardly surprising - we feel like people of the past---relics of 2nd
wave Civilization
2nd wave world = 1 thing at a time
1925 1955 20001965 19751935 198519601945
GI
Boomer
SilentGen X
Grew up & rode the Last Wave
Caught Between Waves
Millennial
Grows Up w/ New Wave
Riding the wave
Some Defining Events-Senior GenerationsSome Defining Events-Senior Generations
Depression cohort (born from 1912 to 1921) Lived thru- The Great Depression, high levels
unemployment, poverty, lack of creature comforts, financial uncertainty
WWII cohort/ GI Gen. (born from 1922 to 1927) Lived thru- : men leaving to war - many not
returning, -- women working in factories, focus on defeating a common enemy
Post-war cohort/ Silent Gen. (born from 1928 to 1945) Lived thru- : sustained economic growth, social
tranquility, The Cold War, McCarthyism
Born: <1945
Values
Born: 1945 ~196478 million
“The Ed Sullivan Show”, Fallout Shelters, Poodle Skirts and Pop Beads, Slinkies, TV Dinners, Hula Hoops,The Peace Sign, “Laugh In”, Clinton, Midler, Leno, Streisand, Gates
“The Ed Sullivan Show”, Fallout Shelters, Poodle Skirts and Pop Beads, Slinkies, TV Dinners, Hula Hoops,The Peace Sign, “Laugh In”, Clinton, Midler, Leno, Streisand, Gates
Cultural Icons & Memorabilia
Cultural Icons & Memorabilia
Baby Boomer cohort #1 (born 1946 to 1954)
Lived thru- : assassination of JFK, RFK, and MLK, political unrest, walk on moon, Vietnam War, anti-war protests, sexual freedom, civil rights – environmental- hippie & women’s movement, protests and riots, experimentation w/ drugs
Baby Boomer cohort #2 (born 1955 to 1964) Lived thru- : Watergate, defeat in Vietnam, the oil embargo, raging inflation, gasoline shortages
IDEALIST – Prophet: Inner-driven, moralistic generation - comes of age during a period of spiritual awakening
IDEALIST – Prophet: Inner-driven, moralistic generation - comes of age during a period of spiritual awakening
Values
“The Brady Bunch”, Pet Rocks, Platform Shoes, “The Simpsons”, “Dynasty”, ET, Cabbage Patch Dolls, Brad Pitt, Cameron Diaz, Carrot Top, TV-Friends, Brady Bunch, Ninja turtles
“The Brady Bunch”, Pet Rocks, Platform Shoes, “The Simpsons”, “Dynasty”, ET, Cabbage Patch Dolls, Brad Pitt, Cameron Diaz, Carrot Top, TV-Friends, Brady Bunch, Ninja turtles
Born: 1965~198048 millionGen X
Initial Impact Events: • Challenger explosion
• Iran-Contra• social malaise• Reaganomics• AIDs• fall of Berlin Wall• Predom. of single parent families
Cultural MemorabiliaCultural Memorabilia
ADAPTIVE- Nomad: A hypocritical generation- coasts along on accomplishments of civics, lay the groundwork for new idealist era.
ADAPTIVE- Nomad: A hypocritical generation- coasts along on accomplishments of civics, lay the groundwork for new idealist era.
Values
Cultural Icons?• Xena Warrior Princess• Buffy The Vampire Slayer• cell phones laptops/ ipods
Cultural Icons?• Xena Warrior Princess• Buffy The Vampire Slayer• cell phones laptops/ ipods
Born: 1980 ~1995
first wired gen…Initial Impact Events::
• Rise of the Internet
• 9-11 • Cultural diversity
• 2 wars in Iraq CIVIC– Hero: Outer-driven, morally complacent generation -institutionalizes ideals of previous generations. .
CIVIC– Hero: Outer-driven, morally complacent generation -institutionalizes ideals of previous generations. .
Values
Generation- ZFeral
Born: 1995+Predicted to be-REACTIVE –
Alienated, cynical generation-challenges the ideals of parents & develops into pragmatic, risk-taking adults..
Generational Marketing
Considerations
Common ExperiencesCommon
Experiences
Common AIO’s, values, tastes,
style...
Common AIO’s, values, tastes,
style...
Common responses to
marketing mix
variables
Common responses to
marketing mix
variables
• Generational mindsets … are major factors in
determining what & how consumers
buy…
The notion a group of people bound together by sharing experience of common historical events 1st introduced by Karl Mannheim - early 1920s
Gen. Marketing Strategy
Not a key behavior driver for all product categories- but is particularly appropriate for:
FoodMusicApparelAutomotiveFinancial & Insurance as well as entertainment
products.
Key Problem for Gen. marketing practitioners --Communicating between generations
Generational Value Differences:GI Silent Boomer X Y
Helpers Sacrifice “For the children”
Right vs. Wrong Resentful “I’ve earned it” Do the right thing
Me, me, me Forever young Choicesprivileges “It’s all about me”
Suspicious Dis- enfranchised Non-confrontational Waste not Facts - family -fundamentals
Optimistic StrongEmpowered Care for others Care for environment Realism
Seniors
Characteristics of Generations
Boomers
X
Y
No news isgood news
Once a year withdocumentation
Interrupts & asks how they’re doing
Wants feedback at touch of a button
Buying Style
Quality first,buy American
Prestige firstforeign is better
Cheap: value added
Get it anyway/anywhere u want
View ofFeedback
On Homes
Buy a decent house
Buy the mosthouse you can
Reclaim the inner city
Livin’ withthe parents- as long as necessary
Comparative Work Ethic Across Generations:
Comparative Work Ethic Across Generations:
Seniors: Boomers: Gen X’ers:Work Style: Team Player Self-absorbed EntrepreneurRewards: You’ve earned it You deserve it You need itWork is: An obligation An Adventure A challengeLeisure: Reward The point to life Relief/funLife: Sacrifice Prosperity Risks
Seniors: Boomers: Gen X’ers:Work Style: Team Player Self-absorbed EntrepreneurRewards: You’ve earned it You deserve it You need itWork is: An obligation An Adventure A challengeLeisure: Reward The point to life Relief/funLife: Sacrifice Prosperity Risks
What can I do for good of organization?
How will this make me feel?
What’s in it for me?
Major Question:
7 work lessons from Gen YAsiaOne Business Tue, Mar 01, 2011
How often have you discussed your younger colleagues with friends and work peers? For many of us with Gen Y staff, the talk isn't always positive:
• They insist on getting their way all the time • If they're the slightest bit bored or unhappy, they quit • They job-hop like nobody's business • After just a few months of working, they expect to be
promoted - like they're entitled to it • I can't stand their 'what's-in-it-for-me' attitude“
New Generation Gaps .. Not only values… but
Defined by tech aptitude & media use
Defined by tech aptitude & media use
Generational Differences
if ask somebody 50+, they think it's probably a bad thing…
15-year-olds think it's awesome to always be connected… getting text & instant messages & cell calls…
.. ask somebody 35-50, they're ambivalent.
Howard Rheingold The Next Revolution: Smart Mobs
Can’t play on stereotypes: “1/3 of consumers over 55 deliberately did
not buy a product because of the outdated images of mature consumers.”
Don’t call ‘em GeezersDon’t call ‘em Geezers
Years Spent in Retirement
2000+ ----- 20 TO 251990 ------- 19.4 YEARS1940 ------- 13.6 YEARS1900 ------- 1.2 YEARS
Emerging Gray $ PowerEmerging Gray $ Power
Represent 50% of purchasing power (discretionary income)
They are wealthier and healthier (mentally & physically)
Major market for-
Exercise facilities Cruises and tourism Cosmetic surgery, and skin
treatments, Education gifts for family members
(especially grandchildren)
Represent 50% of purchasing power (discretionary income)
They are wealthier and healthier (mentally & physically)
Major market for-
Exercise facilities Cruises and tourism Cosmetic surgery, and skin
treatments, Education gifts for family members
(especially grandchildren)
G.I.’s & Silents – How to market to them Emphasize experience and
wisdom Base decision making on
established institutions and authority figures
Key messages should focus on values such as frugality, responsibility and caution
Like to spend money on grandchildren
Key Trends Relating to The "Graying" of the
Baby Boom
Key Trends Relating to The "Graying" of the
Baby Boom
Down-Aging
Being Alive
Down-AgingDown-Aging
The tendency for older people to act and feel younger than their age.
Examples More youthful looking
clothes Hair coloring / hair implants Adult camps and adventure
vacations
Down-Aging - ExamplesDown-Aging - Examples
· TV shows starring cartoon characters: "The Simpsons," "King of the Hill," "South Park," "Daria," "Dr. Katz," "The PJ’s," "Futurama," and "The Family Guy."
· Disney & Warner Brothers stores; 80% of their sales are to adults-for adults.
· eBay, posts 1000’s of hits for Pez
· The median age Harley customer 42; ten years ago was 34.
Being AliveBeing Alive
The desire to lead longer and more enjoyable lives
Examples Vegetarianism holistic medicine (herbs,
naturals, etc.) Meditation
Focus on themselves- early ideals, present predicament & future well-being
Many won’t retireWill begin 2ndcareers Retirement as work style, not
lifestyleWon’t have enough money to
retire (saving rates are low)Looking for meaning - fulfillment
Boomers: Marketing Considerations
“The generation that dropped acid to escape reality… is generation that drops antacid to cope w/ it”“The generation that dropped acid to escape reality… is generation that drops antacid to cope w/ it”
Marketing to Boomers
For the X &Y generations: Increasingly weaned in & imprinted on post-industrial society
For the X &Y generations: Increasingly weaned in & imprinted on post-industrial society
months = new technologydays = new product / serviceminutes = new blog & web-site
Change experience in 1 year…
Grandparents experienced in 1 lifetime.
For X+ generations… it’s all about the rate of changeFor X+ generations… it’s all about the rate of change
Jobs in Lifetime
2nd Wavers: 1 job & 1 Gold WatchMillennials: How many jobs do you think
you will hold in your lifetime?
1-3 35.7% 4-6 41.5% 7-10 16.5% 10+ 6.2%
X+ Weaned w/in– increased
diversity, mobility & innovation…
Pre-Boomers
Boomers
Who are You
3rd Wave individuals much more likely to ID themselves according to their avocation
… as opposed to 2nd wavers – whose ID was derived primarily by their vocation
Generation XHow to market to them
Live flexible lives Don’t buy a house and live in it forever Don’t graduate and get a job and work there until
retirement
Resourceful…Confident…Ambitious Depend on themselves and their own capabilities to
get things done Low to no - confidence in public
institutions –
Generation XGeneration X
Address tough & unsettled economic & personal circumstances….
They've grown up in a world in which sex can kill you & government entitlement programs for older generations will make their taxes go sky-high.
Generation X How to market to them
Abandon hard sell Get to the point and stick to the point Don’t drown message in warm and fuzzy or
unrealistic promises
Get some attitude Attitude, not brand, makes the sale
Have some fun Xers are young people, full of energy and ready for fun Keep life in perspective Crusading is for Boomers, Sacrificing is for G.I.’s and Silents
Divorce - one-parent & step families
working parent- latch-key lives
violence in the streets
break down of traditional values & sources of comfort
Nicknamed -- "The Street-Savvy Generation" because endured:
Generation Y… the cohort variously called :
Gen- Y Echo Boom
Net GenerationMillennials
Millennials live & Learn:
With technology
With each other
Online
Doing things that matter
Source: Achievement and the 21st Century LearnerSource: Achievement and the 21st Century Learner
Y’s R Multicultural Diversity prevails: -
wide range of global viewpoints
Tolerant of cohabitation, single parenting & extended families; different sexual orientations
• Attitudes reflect interest in & acceptance of diversity in all areas of life in private & public arena
• 50% believed would be a black president & 58 % thought there would be a female president- in next 20 years
( 2001 Lifestyle and Media Monitor)
• Attitudes reflect interest in & acceptance of diversity in all areas of life in private & public arena
• 50% believed would be a black president & 58 % thought there would be a female president- in next 20 years
( 2001 Lifestyle and Media Monitor)
Y’s R AmbitiousY’s R Ambitious
Most popular college majors: • Medicine
• Education/teaching
• Business & marketing
Most sought after qualities in careers:
• Responsibility
• Independence
• Creativity
• Idealistic & committed co-workers
Most common job trends :
• Change Careers
• Seek security & benefits
• Stay with company that offers a challenge
• Engineering• Law & politics• Computer science
POP QUIZ
GI Silent Boomer X MillennialHelpersSacrifice“For the children”
Right vs. WrongResentful“I’ve earned it”Do the right thing
Me, me, meForever youngChoicesprivileges “It’s all about me”
SuspiciousDis- enfranchised Non-confrontationalWaste not Facts - family -fundamentals
OptimisticStrongEmpowered Care for others Care for environmentRealism
Match the Message
• Save $$$• Provide for your children & grandchildren • Responsibility• Don’t be a burden to anyone• Wise use of money• Plan for your financial survival
• Save $$$• Provide for your children & grandchildren • Responsibility• Don’t be a burden to anyone• Wise use of money• Plan for your financial survival
• Your family would be proud!• The right choice• A good investment• A good value• A responsible decision• Plan now for your future comfort• Ensure your future independence
• Your family would be proud!• The right choice• A good investment• A good value• A responsible decision• Plan now for your future comfort• Ensure your future independence
• “just go on-line", interactive • Build your own plan/policy • Tailored to your need• Take care of others • Responsible decision • Plan for the future
• “just go on-line", interactive • Build your own plan/policy • Tailored to your need• Take care of others • Responsible decision • Plan for the future
• You protected your family• A great value• make claims without problems• You were not wasteful – you used your• resources wisely• You left things better than u found them
• You protected your family• A great value• make claims without problems• You were not wasteful – you used your• resources wisely• You left things better than u found them
• Tailored for you• No waiting/convenience • Expensive, but you are worth it • Better investment than the stock market • Forever young – maintain your youth • Lifestyle enhancement (freedom) • Protecting what you have• Your legacy / immortality
• Tailored for you• No waiting/convenience • Expensive, but you are worth it • Better investment than the stock market • Forever young – maintain your youth • Lifestyle enhancement (freedom) • Protecting what you have• Your legacy / immortality
Boomers
Millennials
Xers
GISilent
Beyond Generational Segmentation
1960s computers kicked mass marketing into high gear with zip-code segmentation.
1970s multivariate analytical applications , psychographic segmentation techniques
1980s population analytics & relational databases, values & life-STYLE segmentation
1985 Technographics
1990s The Internet & 1-to-1 marketing
2000-to Date collaborative filtering, life-STAGE segmentation, Social-Technographics
Evolution of market segmentation strategy
Key to Marketing always been & always will be identifying & knowing your customer
market segmentation=Statistical Procedure
clusters cases/consumers so as to maximize homogeneity-within & heterogeneity-between groups
on key variables/segmentation dimensions such as: demographic, geographic, socio-graphic, psychographic, technographic characteristics, lifestyle, generational &/or behavioral patterns
Sta
tus
Dependability
Market w/3 segments
Sta
tus
Dependability
Market w/6 segments
Segmented on 2 attributes
Key Segmentation Decisions:
1.Size & # segments u select to target
2.What dimensions u use to segment consumers
Sta
tus
Dependability
Market w/3 segments
Market w/6 segments
1) Size & # segments select to target
• Undifferentiated/ Mass Marketing
• Differentiated/ Segment Marketing
• Concentrated/ Niche marketing
• One-to-One/ Micro marketing
2nd Key decision: What dimensions you use:
Who / Where Geographic Segmentation Demographic Segmentation
– SocioGraphics
Consumes How Much Volume Segmentation
& Why Psychographic Segmentation
– Motives, Traits, AIO’s, Attitudes & Beliefs, Benefits
Behavioral
GeoDemographic
LifestyleGenerational
Demographics
• Age, sex, income, occupation, education, marital status, location, household characteristics, etc….
Socio-Graphic Indexes:• SES- Socio-economic Status
(income+ occupation+ education)
• FLC- Family Life Cycle (age+ martial status + age/# kids)
Middle Class
Working Class
Working Poor
The Under Class
Capitalists Class
Capitalists1%
Capitalists1%
Top 1% w/ income from assets earned or inherited
Most Shopping done by personal assistants
Upper Class
SES
Family Life Cycle
• Yuppies- young urban professionals
• Chuppies- chinese urban professionals
• Dinks- dual income no kids• Poops- persons on one
pension• Clumps – computer literate
urban metro-sexual professionals
• Twits- teens with info technologies
• Tweens- 11-12 year olds
TGA’s =target group acronyms (some mix of age/ location/ occupation/income/ or any other unique descriptor…)
GLAM - Greying, leisured, affluent, middle-aged
GUPPY- Green YUPPY
NILKY- No income, lots of kids
OINK- One income, no kids
PANSE- Politically active, not seeking employment
RAPPY- Retired, affluent professionals
SITCOM- Single income, two children, outrageous mortgage
SUPPY- Senior urban professionals
WOOPY- Well-off older people
YAPPY- Young affluent parents
ZUPPY- Zestful upscale person in their prime
Geo-Demographic Segmentation
A composite segmentation strategy: uses geographic variables (zip codes, neighborhoods) & demographic variables (e.g., income, occupation,
value of residence) to identify target markets.
Census Demographics
Census Demographics
NeighborhoodGeography
NeighborhoodGeography
Consumer Behavior
Data
Consumer Behavior
Data
Social rank HH composition Housing Ethnicity Urbanization Mobility
Census tracts Block groups Zip codes (9-digit) Carrier routes
Automobiles owned Magazine readership Direct marketing data Real estate Credit Expenditures
CLUSTER - ANALYSIS
Zip-Clusters
The Logic:Birds of a Feather….Flock
Together
People w/ similar cultures/values & $$$$ gravitate to one another - form relatively homogeneous communities
Once settled in, people emulate their neighbors, adopt similar tastes & expectations…
And most important of all, share similar patterns of consumer behavior re: product/brand preference & media ...
…15,000+ companies in the United States & Canada alone used zip-clusters as part of their marketing
information mix last year…
Geodemographics: PRIZM, Claritas, and Clusters Geodemographic ... www.andreas.com/faq-geodemo3.html
Geo-Demographic Segmentation’s Continued
Popularity
Elvis Lives!
http://www.claritas.com/target-marketing/market-research-services/marketing-data/marketing-segmentation/segmentation-systems.jsp
1960s computers kicked mass marketing into high gear with zip-code segmentation.
1970s multivariate analytical applications , psychographic segmentation techniques
1980s population analytics & relational databases, values & life-STYLE segmentation
1985 Technographics
1990s The Internet & 1-to-1 marketing
2000-2010 collaborative filtering, life-STAGE segmentation, Social-Technograhics
Evolution of market segmentation strategy
PsychographicsMeasures used to determine
what’s going on in the consumer’s head:
1. Motivations2. Personality Traits & Self-
concept3. Activities, Interests &
Opinions4. Attitudes & Beliefs5. Benefits sought from
product…
Measures used to determine what’s going on in the consumer’s head:
1. Motivations2. Personality Traits & Self-
concept3. Activities, Interests &
Opinions4. Attitudes & Beliefs5. Benefits sought from
product…
Some Key Consumer Traits
Brand-LoyaltyStyle-consciousnessPrice-consciousnessRisk-Taking InnovativenessLiberal / conservative Introvert / extrovert Inner / outer directed
SensorySegment
SociableSegment
WorrierSegment
IndependentSegment
Flavor & product appearance
Principal benefitsought
Brightest of teeth PriceDecay prevention
ChildrenDemographicstrengths
Teens, young people
MenLarge Families
Users of spearmint-flavored toothpaste
Special behavioralcharacteristics
Smokers Heavy usersHeavy users
SOURCE: Adapted from Russell I. Haley, “Benefit Segmentation: A Decision-Oriented Research Tool, “Journal of Marketing, July 1968, pp. 30-35.
(continued)
Figure 5-3
ColgateBrandsfavored
Macleans, Ultra Brite
Cheapest brand
Crest
HedonistLifestylecharacteristic Active Value-
orientedConservative
The Master of Benefit Segmentation
Procter & Gamble:
Tide: for family marketCheer for clothes -conscious
w/ color guard Bold: for value-conscious –
w/ fabric softenerGain: for scent-conscious –
w/ aromaticsEra: for dirt-conscious –
w/ stain removers
Dash: for price-conscious
Dreft: for new mothers
Ariel: for eco-conscious
Tide: for family marketCheer for clothes -conscious
w/ color guard Bold: for value-conscious –
w/ fabric softenerGain: for scent-conscious –
w/ aromaticsEra: for dirt-conscious –
w/ stain removers
Dash: for price-conscious
Dreft: for new mothers
Ariel: for eco-conscious
Lifestyle-SegmentationLifestyle-Segmentation
Classifies the way one lives
… & constellation of products & services
used to support that
existence
Model based upon Riesman's Social Values & Maslow’s hierarchy of
needs
Societally Conscious
External vs. Internal Locus of Values/Rewards
Esteem
Self Actualization
Safety
Belonging
Physiological
VALS Logic: Personality traits + key
demographics determine an individual's lifestyle
1. A person's tendency to consume goods & services extends beyond age, income, education & geolocation
2. Energy, self-confidence, intellectualism, novelty seeking, innovativeness, impulsiveness, leadership, & vanity….play critical role
3. Different levels of resources enhance or constrain a person's expression of their primary motivation… Ideals vs. Achievement vs. Self-Expression
http://www.sric-bi.com/VALS/
STRUGGLERS
FULFILLEDS
BELIEVERS
ACHIEVERS EXPERIENCERS
STRIVERS MAKERS
Low Resources
High Resources
Action OrientedStatus OrientedPrinciple Oriented
ACTUALIZERS
Actualizer Fulfilled Believer Achiever Striver Experiencer Maker Struggler Total
VALS Segments -Demographic Profiles
Total Actualizer Fulfilled Believer Achiever Striver Experiencer Maker Struggler
Val’s & Dr. Pepper’s
advertising strategy
Val’s & Dr. Pepper’s
advertising strategy
Outer-Directed: Strivers & Believers
Inner-Directed:Experiencers & Makers
Go Find Your Self
http://www.strategicbusinessinsights.com/vals/presurvey.shtml
Take the VALs Survey- and find what segment you belong to…
1960s computers kicked mass marketing into high gear with zip-code segmentation.
1970s multivariate analytical applications , psychographic segmentation techniques
1980s population analytics & relational databases, values & life-STYLE segmentation
1985 Technographics
1990s The Internet & 1-to-1 marketing
2000-2010 collaborative filtering, life-STAGE segmentation, Social-Technographics
Evolution of market segmentation strategy
Technographic Segmentation Scheme
Define & Segment consumers according to:
OwnershipUse PatternsMotivations (purchase & use)Attitudes toward TechnologyAttitudes toward Media
Define & Segment consumers according to:
OwnershipUse PatternsMotivations (purchase & use)Attitudes toward TechnologyAttitudes toward Media
The concept and technique was first introduced in 1985 by Dr. Edward Forrest[1] in a study of VCR users and later elaborated upon in the article, "Segmenting VCR Owners" published in the Journal of Advertising Research. In the article it was suggested that the profiling of technology consumers "should be based on an amalgam of variables which might best be referred to as "technographic"... which "focuses on the motivations, usage patterns, attitudes about technology... as well as measures of a person's fundamental values and lifestyle perspective."
Technographics® Segmentation Model
Primary motivationAttitude Income
$ ¢
$ ¢
Techno-strivers
Techno-strivers
DigitalHopefuls
DigitalHopefuls
GadgetGrabbers
GadgetGrabbers
HandshakersHandshakers TraditionalistsTraditionalists MediaJunkies
MediaJunkies
Sidelined CitizensSidelined Citizens
FastForwards
FastForwards
New AgeNurturers
New AgeNurturers
MousePotatoes
MousePotatoes
Fast Forwards• Males, married, children
at home
• Higher education, income
• Career motivated
• Highest adoption PC & W3,Leading user bus. Software
• 1st market cell phones
• Prime target W3 Travel sites; Hi speed connection
Segmentation profiles:
Techno-strivers
DigitalHopefuls
GadgetGrabbers
Handshakers TraditionalistsMedia
Junkies
Sidelined Citizens
FastForwards
New AgeNurturers
MousePotatoes
Sidelined Citizens
• Females, no children at home
• Low income
• No typical motivation
• Low use of tech products
• Little online activities
Nurturers• Males & females
• Family motivated
• Lead all seg’s adoption Educational software
• Prime target digital photography
Segmentation profiles:
Techno-strivers
DigitalHopefuls
GadgetGrabbers
Handshakers TraditionalistsMedia
Junkies
Sidelined Citizens
FastForwards
New AgeNurturers
MousePotatoes
Media Junkie
• TV lovin’ couch-potato
• Not pc savvy
• Little patience for complex technology
• Spend disposable income on cable TV & CD’s
Mouse- potato
• 2nd only to FF’s in PC & W3
• Top segment satellite TV, interactive gameboys, PC games
• Prime target premium cable, pay-per-view & webTV
• Initial target DVD
Segments in Europe
Primary motivationAttitude Income
$ ¢
$ ¢
Techno-strivers
DigitalHopefuls
GadgetGrabbers
Handshakers TraditionalistsMedia
Junkies
Sidelined Citizens
FastForwards
New AgeNurturers
MousePotatoes
11% 6%8%
10% 11%8%
5% 4%6%
31%
Red % = Europe
12% 9%8%
7% 9%7%
7% 5%8%
28%
Blue % = USA
… and the US
Advertising Strategy
© 2010 Forrester Research, Inc. Reproduction Prohibited135
--classifies people
according to how they use
social technologies.
Social Technographics
Groups include people participating in at least one of the activities monthly except Conversationalists who participate in at least one of the included activities at least weekly.
© 2010 Forrester Research, Inc. Reproduction Prohibited136
Creators make the social content consumed by others. They write blogs or upload video, music, or text.
The Social Technographics Ladder
© 2010 Forrester Research, Inc. Reproduction Prohibited137
Conversationalists voice their opinions to other consumers and businesses using vehicles like SNS and Twitter.
The Social Technographics Ladder
© 2010 Forrester Research, Inc. Reproduction Prohibited138
Critics respond to content from others. They post reviews, comment on blogs, participate in forums, and edit wiki articles.
The Social Technographics Ladder
© 2010 Forrester Research, Inc. Reproduction Prohibited139
Collectors organize content for themselves or others using RSS feeds, tags, and voting sites like Digg.com
The Social Technographics Ladder
© 2010 Forrester Research, Inc. Reproduction Prohibited140
Joiners connect in social networks like MySpace & Facebook
The Social Technographics Ladder
© 2010 Forrester Research, Inc. Reproduction Prohibited141
Spectators consumer social content including blogs, user-generated video, podcasts, forums, or reviews
The Social Technographics Ladder
© 2010 Forrester Research, Inc. Reproduction Prohibited142
The Social Technographics Ladder
Inactives neither create nor consumer social content of any kind
© 2010 Forrester Research, Inc. Reproduction Prohibited143 Forrester Social Technographic Tool -http://www.forrester.com/Groundswell/profile_tool.html
Overall Population
Distribution
Social Technographics- Profiling Tool:
1960s computers kicked mass marketing into high gear with zip-code segmentation.
1970s multivariate analytical applications , psychographic segmentation techniques
1980s population analytics & relational databases, values & life-STYLE segmentation
1985 Technographics
1990s The Internet & 1-to-1 marketing
2000-2010 collaborative filtering, life-STAGE segmentation, Social-Technographics
Evolution of market segmentation strategy
--- it’s now possible to…Know who your customers are & who
your best customers areKnow when & how they buyLearn customers’ preferences & shape
offers accordinglyFormulate strategies to make your
customers loyal & to keep them for many years
Define characteristics that make up a great/profitable customer
Select channels that best address a customers’ needs
Predict what they may/will buy in the future
1960s computers kicked mass marketing into high gear with zip-code segmentation.
1970s multivariate analytical applications , psychographic segmentation techniques
1980s population analytics & relational databases, values & life-STYLE segmentation
1985 Technographics
1990s The Internet & 1-to-1 marketing
2000-2010 collaborative filtering, life-STAGE segmentation, Social-Technographics
Evolution of market segmentation strategy
Collaborative Filtering:Twinsumption & Twinsumers
-making automatic predictions about the interests of a user by collecting taste information from many users….
http://www.trendwatching.com/trends/TWINSUMER.htm
Life Stage Segmentation
We have shared life stage experiences as we “grow-up”.
Leaving Home
Getting Divorced
Having Jobs
Technology
Getting Married
Approaching Retirement
Political Events
Buying a Home
Gaining Wealth
Fully Retired Launching Kids
Having Careers
Cultural Events
Leaving School
Having Kids
Personicx places each of 112MM+ U.S. households in
its InfoBase into one of 70 segments based
on its specific life stage consumer behaviors & demographic characteristics.
This enables marketers to see the dramatic difference between consumer behaviors of HHs in same geo-cluster--
Three Next-Door Neighbors – Three Different Life Stages
Same ZIP + 4®, Block Group, Tract and ZIP®
Different households with different Personicx Life Stage Clusters
A household-level segmentation system
Taking Hold: Cluster 18 Beginnings: Cluster 39
Aging Upscale: Cluster 23
• Provides picture of consumers through Multi-Sourcing – integrating data from 35 contributing sources. Providers include:
• Product registration / Questionnaires/ Warranty & Credit Cards
• Catalogers and Publishers
• Special Retailers / Packaged Goods Manufactures
• Public Information: US Phone Directories, Birth Records, Real Estate Property Records, etc.
Track Changes over Time
• Every year in the U.S…– 1.5 million new addresses are
created– 1 in 6 people move (40 million)– 1 in 5 movers (8 million) leave no
new address– 1 in 100 people get married (4.7
million)– 1 in 200 people are divorced (1.9
million)– 1 in 115 people die
PERSONICX GEO Cluster Key
Applications -
1. Pre-emptive Marketing with Personicx LifeChanges List targeting
2. Timed Repeat Shopper Analysis Using Lifestage Trend Data
3. Lifestage targeted Creative / Offer Versioning
4. Projecting Store-site Performance
5. New Product Research – Focus Groups
6. Campaign Response Analysis
7. Projected Competitive SWOT Analysis
8. Timed Sales Channel Targeting
9. Lifestage Trajectory Merchandise Mix Matching
10.Projected Customer Profitability Analysis
Simmons Profile - Shopped at Sears Lst 4 Wks Competitive Landscape ChartComparison profile: SHOPPING - Shopped at Kohl's (4Wk)
* Bubble sizes indicate segment's market size
58
16
30
66
23
42
69
12
19
46
7
1115
47
17
9
6
1351
22
28
52
43
2
4
14
18
4065
2736
2656
25
5510
4945
33
4838
608
63372031
15
21
3
5459
50
4153
6762
34
24
7039
68
3235
6129
64
44
57
-50
0
50
100
150
200
250
300
0 50 100 150 200 250 300
Simmons Shopped at Sears Lst 4 Wks
SH
OP
PIN
G -
Sh
op
ped
at
Ko
hl's
(4W
k)
O S
W T
Analytical and Planning Applications Competitive SWOT Analysis
Sears vs. Kohl’s Clusters Under
Greatest Competitive Pressure
Threat – Head-to-Head Strategy - More likely to shop at both Strength for Sears - Loyalty Strategy - More likely to shop at Sears and less likely to shop at Kohl’s Weakness for Sears – Snatch and Grab Strategy - More likely to shop at Kohl’s and less likely to shop at Sears Opportunity – New Market Evaluation Strategy - Less likely to shop at either Sears or Kohl’s
Link to Simmons Overview Slide Back to Top 10 List
Persuaders Excerpt
Overview of Acxiom Corporation
AI/ Semantic Analysis Targeting
GraphEffect –measures purchase intent via semantic analysis
Thru AI algorithms: can target: ie Men aged 35-44 with two kids who live in the
Buffalo, New York, area, …read car-enthusiast web sites ….are in-market to buy a car, and love the
Audi brand –- but could be tempted to buy a Lexus in the next 2 months
