Segmentation 2015

© 2015 Wendy W. Roan, All Rights Reserved

Are Demographics Dead? Segmentation Trends

1

© 2015 Wendy W. Roan, All Rights Reserved 2

ROAN GROUP | Washington, DC


Segmentation Choice

• Segmentation Research

• Segmenting in Execution

• Example

3


Marketing is a silver bullet-driven field.


“The best Chief Marketing Officers have both left brain and right brain proficiency. They must have both the analytical ability needed to focus on return for their spend, but also the creativity needed to position their

brands in ways that are truly distinctive.” John Quelch, WPP Group

Charles Edward Wilson Professor of Business Administration, Harvard Business School

5

What is needed:

...Analytical ability needed to focus on return for their

spend

...Creativity needed to position their brands in ways

that are truly distinctive.



Are demographics dead? 2 Camps

8

Demographics OnlyGeo-Demographics AND Lifestyle

comScore Adweek, Trendwatching

Nielsen TV and radio ratings Nielsen PRIZM

Experian Experian Mosiac

Segmentation Research

CreativityInsightsResearch & Observations


Your target audience?

10


“Today's fragmented landscape is best evaluated by looking at the ‘life stages’ as opposed to their demographic profiles.”

Are Demographics Dead? AdWeek, by Steve McClellan

11


Define THE most important business goal. Rank the rest.

• Customer retention & increased loyalty

• Lead generation

• Increase wallet share

12


Your Marketplace

Your Customers

Your Company


No one-size-fits-all even within industries. What are your:

‣ Unique strengths

‣ Core competencies

‣ Brand strategy

‣ Customer focus

14


Customer Segmentation Questions

15

• Who are my customers?

• How profitable are my customers?

• What do my best customers look like?

• Who are the least profitable customers?


Internal Data Sources

• Strategic Plan inputs and identified needs

• Qualitative & Quantitative Research

• Acquisition and Churn Analysis: current vs. updated segmentation model

16


Internal Data

17

+

Web

Email Response+

In Store+

Purchased Data


Buying Behavior Analyses

• Revenue Amount: Large vs. small

• High Value vs. Low Value

• Frequency

• Multi-year measures

18


Analyze buying behavior by segment

19

FY10 FY11 FY12 FY13 FY14

Lost -$1,824,064 -$5,431,968 -$2,632,784 -$18,437,026

Retained $595,377 $1,059,004 $2,243,962 $3,827,261

New $2,419,441 5,895,595 3,639,696 18,771,081 9,277,599

Re-Acquired $268,285 $308,545 $384,085

Active Accounts $2,419,441 $6,490,972 $4,876,746 $22,264,287 $13,873,657

Running Churn -$1,824,064 -$7,256,032 -$9,888,816 -$28,325,842


Tough choices, even for our most lovable customer friends.

20

Are favorite customers draining resources?


External Data Sources

• Market (competitive and complementary) research

• Industry collaboratives (i.e. associations)

• Signal brands

21


‣ 51% of US

‣ Make 85% of HH buying decisions.

‣ Senior women control 75% of US wealth.

‣ 56% social media users

22

49%51%

Female Male

Pew Internet & American Life Project, project of Pew Charitable Trusts. She-Economy.com. Mass Mutual Financial Group. US Census

Females: Focus on their lifestage!


B2B or B2C?

23


B2B Segments

24

B2B Consumers

Industry

Revenue Size or Buying

Behavior

Geography

Product line

Purchase location


Consumers

Marketing campaign segments

25

Demographic

Customer vs

Prospect

Loyalty Program

Geography

Decision Makers

Product line

Purchase Location

Industry


Geography & Lifestyles

26


Map consumer locale. Segment geographically.

27


Geo-Demographic + Lifestyle Market Segmentation

• Nielsen PRIZM

• Experian Mosaic® USA

• Environics Analytics Group (Canada)

28


Geo-Demo Segments Lifestage Groups

• Zip+ four location

• Demographics

• Lifestyle

• Where to find more (traditional media)

• Where to advertise

29


Lifestyle: Nielsen PRIZM

30



Market & Trade Area

Segmenting in Execution


Is this your nightmare?

34


Creative signals segments

‣ Communication channel

‣ Photography

‣ Key messages and ad copy

‣ Content

‣ Websites

35


Example

36



Business Goals

1. Increase income by:

• Increasing quality and # of (prospective) residents.

• Decreasing resident move-out rate.

2. Create a consistent, more modern Colony Management Corporation and 10 property brands to strengthen brand recognition and appeal to the next generation.

38


Marketing Segmentation Strategy

• Lifestyle: long-term home, peaceful/quiet, seek community

• Demographics: income, age,

• Life stage: mother/child, retirees,

39


Target Audiences

40

(Young) families

Young professionals

Long-term Renters

Service & Blue Collar Industries


Secondary Target: Seniors (50-65)

41


Diverse resident needs.

42

I enjoy the peace, privacy, & quiet. I

keep to myself other than say hello. I haven’t

met my neighbors.

We are like family and look out for

one another.


Lifestyle Life stage Demographic

Segmentation Strategy


Segmentation Strategy

44

Lifestyle Life stage Demographic


Colony mobile strategy was important because African Americans & Hispanics embrace mobile.

45Pew Research Center

Perc

en

t

0

14

28

42

56

70

Texts per day

31%

49%

70%

Black Hispanic Whites


Mobile ad: Simple & Short

‣ Drive awareness

‣ Quick purchases

‣ Reinforce other channels

46


Marketing Channel Segmentation

47


Segment Marketing by Channel

• Where do customers research my products? Engage? (search, email, social, face-to-face)

• What are the greatest ROI engagement sales drivers by segment?

• Which signal brands do I use for retargeting ads? Develop strategic partner relationships?

48


Don’t forget the CEO channel.

49


Segmented Email Campaigns

• Opens: 15% higher vs. non-segmented campaigns.

• Unique Opens: 11% higher vs. non-segmented.

• Clicks: 55% higher vs. non-segmented campaigns.

50

May 2015 MailChimp Study


Increased Email Response

‣ Segment email campaign

‣ After cart abandonment through multiple channels

‣ Retarget

51

eMarketer, Email Marketing Benchmarks 2015: Are Performance Metrics Revealing Signs of Consumer Fatigue


Segment by customer buying & engagement type

52

Communications Channel

Email Behavior

Web Behavior

Mobile Behavior

Inbound

Sales Team


Repeat communications increase believability

53

Informed publics age 25-64

2%3%

6%

8%

26%

33%

22%

Twice (2)Three (3)Four to Five (4-5)Six - Nine (6-9)Ten or moreOnce (1)Don’t know

Edelman Trust Barometer


Segment Options Summary

• Business goals/strategy

• Demographic

• Geography

• Industry

• Purchase location

• Products

• Revenue/Profitability

54

• B2B or B2C

• Consumer needs

• Engagement channel

• Growth industries

• Lifestyle

• Purchaser

• Buying behavior (Loyalty program)

Internal Customer


Connect with me Wendy Roan

[email protected]

202.549.7954 LinkedIn: http://linkd.in/olPirZ

55

Documents

Segmentation 2015