Segmentation strategy is the concept of dissembling your clients and choosing to base your marketing efforts on a specific target group. In some cases you may target your efforts on more than one group, but the basic goal is to directly target each group on an individual basis so that you can maximize your sales profits. There are many different ways that you can cluster your clients, but most businesses either choose to dissect their client base either by purchasing groups based on factors such as income, region, or socio-economic factors or cluster their target audience by their typical buying and spending habits.
Segmentation strategy relies extensively on consumer research and behavioral analysis alongside extensive data collection techniques. Due to the fact that it encompasses many areas of a business clientèle often it is a group effort on the part of the company and may require that a company rework its management and marketing team and strategies. The payoff is that when a marketing project is launched it is a proactive project aimed to reach those who are most likely to buy instead of focusing on a general market with an offer or deal that they may or may not be interested in.
An excellent example of segmentation strategy is international car industries such as Toyota, Honda, or Audi. In order to meet the needs of their regionalized clients these companies often produce different versions of successful cars that meet the needs of their residents. For example, certain countries such as Britain and Japan are focused heavily on the small compact electric vehicles that are on the market currently. Therefore, Toyota will market a small streamlined engine and compact vehicle here. However, in America where large and stylish is still the desired norm the same vehicle will in effect be built up to attract sales.
The effectiveness of segmentation strategy largely depends on the efforts that a company puts into it. In the online world designing different websites and emails for segmented clients is an excellent approach to reap the benefits of the market targeting strategy. Consultants are often a great place to start when initializing segmentation strategy as they already hold a large degree of the knowledge needed to make segmentation strategy work to its fullest degree. Supplementing a consultant’s knowledge with company data is an excellent way to cluster your clients and start to reap the benefits in profits of a carefully managed target audience.