Market Segmentation

Research for Boosted Sales, Profitability & Competitive Advantage

In today’s competitive environment and saturated marketplaces, companies need strong relationships with customers.

Instead of raising the amount of resources dedicated to these efforts, companies need to invest in “smart” strategies. Market Segmentation can help companies identify the customers that they can effectively service.

Benefits of Market Segmentation Research:

  • Companies can extract the most value from their most profitable customers because of their willingness to spend.  According to the Pareto Principle, companies can benefit from targeting the 20% of customers that compose 80% of their revenues.
  • Increased loyalty can lower new customer acquisition costs over the long term and focus scarce resources better.
  • Marketing costs may become cheaper, as customers increase their frequency of purchase.
  • Companies can better specialize their servicing of profitable niche markets.

Uncovering Profitable Market Segments

SIS Market Segmentation Market Research answers who are the untapped profitable markets and how to reach them. We deliver actionable insights on pricing, demand, messaging and customer expectations.

As part of our unique “Hybrid” Research approach of Market Research and Strategy methods, we analyze the wider impact of targeting certain segments on our client’s supply channels and competitive position. These market segmentation services allow companies to develop a clear market positioning that can be tested.

Consumer Market Segmentation Services

SIS International Market Research works with clients to develop segmentation plans that are accurate, reliable and useful. Segmentation variables vary depending on how customers interact with our clients:

  • Psychographics / Lifestyle
  • Profitability / Lifetime Customer Value
  • Behavior
  • Benefit / Attribute
  • Use or Application
  • Product Class
  • Price / Quality Demands

In developing segmentation plans, researchers must understand segmentation nuances. Many industries can have “Multiple Influencers” or non-buyers that heavily influence the purchase of products. An example is of a young child (non-buyer) influencing his parent (buyer) to purchase cereal. Also, many industries have different relationships with novices and expert product users. With novices, companies often focus on product benefits and provide multiple exposures to information. With experts, companies often conduct marketing by focusing on attributes and less exposure of the message. SIS works with clients to develop a customized solution fitting their needs.

Business-to-Business Market Segmentation Services

Business-to-Business market segmentation rarely receives the attention that customer segmentation receives.  SIS helps companies develop useful, accurate and actionable segmentation plans. Segmentation variables may include:

  • Decision Makers
  • Firmographics (e.g. revenue size, employee size, industry type)
  • Behavior
  • Profitability / Lifetime Customer Value
  • Benefit / Attribute
  • Organization Type
  • Business Culture
  • Use or Application
  • Product Class
  • Price / Quality Demands
  • Customer Needs
  • Competitors

Considerations for Market Segmentation

Many segmentations are focused on value, rather than functionality and company size. In these plans, companies focus on perceived benefits which underlie the target segment’s purchasing considerations.

In low-involvement product offerings, companies often consider researching usage behavior, buyer behavior, price elasticity / sensitivity and brand loyalty, among others.  For high and medium involvement products, businesses often consider researching their customers’ comprehensive needs, buyer types, business’ buying behavior and core values, among many others.  Lifetime Customer Value as a metric provides a measurement of the customer’s total worth which can help companies concentrate on improving profitability. Indeed, the variables for segmentation will vary by objective, company and industry.

Contact us for your next Market Segmentation Research project.