May 17, 2019

Segmentation Marketing

Segmentation marketing is the most effective and cost-efficient strategy to educate, influence and engage your key target audiences.

Step one is the STP process which stands for Segment, Target, and Position. STP identifies audiences and creates target personas based on their needs, wants, tastes and four unique criteria.

  • Geographical… referring to country, region, city, town, zip codes
  • Psychographic… identifying behavior, personality and lifestyle traits
  • Demographic … relating to age, gender, socio-economic class and education
  • And Behavioral… that uncovers brand loyalties and usage rates

Step two is the target marketing process and conducting a DAMP analysis, that stands for Discernible, Accessible, Measurable and Profitable.

  • Discernible, is finding the USP, unique selling proposition or the differentiator.
  • Accessible, identifies your audiences most effective touchpoints and media outlets.
  • Measurable, is the monitoring metric models used for tracking a campaigns performance
  • And Profitable, which stands for the ROI, Return on Investment and the CAC, customer acquisition costs.

And Step 3 for effective targeting is understanding the level of differentiation in a market segment. We use three modes of differentiation

  1. Undifferentiated, is when a company produces similar products for all segments.
  2. Differentiated relates to products with slight modifications within a segment.
  3. And Niche, when a company produces a product to satisfy a specific segment.

Segmentation marketing eliminates waste, maximize efficiencies and optimizes marketing budgets.

Our next video provides the simple steps to implementing a successful segmentation marketing strategy.

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