Pros and Cons of Segmentation Research
10 Aug 2020

Segmentation is a market research method that is a tried and true way to understand your target audience. A segment is a group that shares one or more characteristics (e.g., demographics and psychographics). It acts as a useful way to split up consumers into separate groups for marketing purposes. 

Whether you are a company that is launching a new brand or re-evaluating a different path forward, segmentation can give your brand insight to inform your marketing strategy. However, like any research method, segmentation has specific use-cases, and it isn’t always the proper thing to do. Continuing our blog series on the pros and cons of research methods, read on for the advantages and disadvantages of segmentation!

Segmentation Research Pros

Creating Personas

One of the most illuminating parts of segmentation is bringing them to life in personas. Segments are split based on their similar answers to questions, which includes demographic questions. A persona consists of similar traits, beliefs, behaviors, values, and attitudes. Visualizing this persona and giving them a descriptive name can make your marketing strategy simpler to understand and implement. This is one example of the power of segmentation. 

Ability to Prioritize Segment Groups

Once you are able to segment the population into separate groups and focus on a particular target audience, you can prioritize the list of segmented audiences. Prioritizing segments can be done in many ways; one way is to order the cohorts based on propensity to purchase your product. 

You can also project the size of each segment to determine if this audience warrants the investment. This can also help to prioritize segments and create a marketing map based on each group. Most importantly, this can indicate which segments to leave out and focus energy elsewhere. 

Augment Segmentation Research with Secondary

Segmentation is the type of research that pairs very well with outside sources and databases. Supplementary information can bring new information to your personas, such as media habits, geographic information, and more. The addition of external information to your survey data is robust and leads to great results. 

Segmentation Research Cons

Cost 

Segmentation research is typically more costly than other survey methodologies. Segmentation isn’t as easy as it looks. To segment the data, you will need a significant amount of sample- often having over a thousand participants completing the research. The advanced analytical process is not simple. Typically a segmentation study uses a factor analysis to uncover themes followed by a cluster analysis to create sizable cohorts. 

Other Issues

When you develop a segmentation, you need to make sure:

  • You do not exclude prospects simply because they are not your key targets.
  • You understand that consumers’ attitudes and beliefs may not be fixed. That being said, it’s vital to know how psychographics can change over time. As a result, you may need to refresh the segmentation after a certain number of years or have significant changes to your business. 
  • Finally, you have a way to target or reach the segment that you created. In other words, a bad segmentation is when you have a robust study but have no way to identify who is each group in your prospect and customer database. 

Read some of our blogs from this series here:

  1. June 17th, 2020: The Pros and Cons of Online Focus Groups
  2. February 6th, 2020: The Pros and Cons of In-Depth Interviews
  3. July 13th, 2020: The Pros and Cons of Online Survey Research
  4. June 28th, 2020: The Pros and Cons of Message Testing

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