The best marketing begins with a focus on segmentation. That is, recognising that different groups of customers have different needs and therefore need to be targeted with a specific marketing plan. Therefore, segmentation is a vital component of any successful marketing strategy.
Segmentation can be approached in three main ways: firmographic, behavioural and needs-based.
Firmographic segmentation is by far the simplest, grouping customers by aspects such as age, gender, company size, industry vertical, income and location.
Behavioural segmentation takes things up a notch, identifying how customers act and grouping them this way. How often a company switches supplier, for example.
Thirdly, a needs-based approach is the best and most effective way of segmenting customers. It’s also the most difficult, however. This approach aims to identify specific customer needs, allowing products and services, and also marketing communications, to be tailored and targeted specifically at each segment.
Whichever approach is chosen, it needs to be done correctly. For a more in-depth look at the 3 different approaches, take a look at our article on the subject.