segmentation for american marketing association central va

© 2015 Wendy W. Roan, All Rights Reserved

Are Demographics Dead? Segmentation Trends for today

August 18, 2015

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© 2015 Wendy W. Roan, All Rights Reserved 3

ROAN GROUP | Washington, DC


Population Growth

4

0

30,000

60,000

90,000

120,000

1960 1970 1980 1990 2000 2010 2014

Virginia

Albemarle County

US

US Census


Charlottesville

• Top 5 cities for retirees

• America’s 5 New Foodie Cities

• Most exciting place in Virginia

• America’s favorite mountain town (#9)

• Best college town in U.S.

• America's Healthiest Small Cities (#6)

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City of Charlottesville Albemarle County, VA

We are in a silver bullet-driven field.


“The best Chief Marketing Officers have both left brain and right brain proficiency. They must have both the analytical

ability needed to focus on return for their spend, but also the creativity needed to position their brands in ways that are

truly distinctive. The first outweighs the second.” John Quelch, WPP Group

Charles Edward Wilson Professor of Business Administration, Harvard Business School

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What is needed:

...Analytical ability needed to focus on return for their

spend

...Creativity needed to position their brands in ways

that are truly distinctive.

Are Demographics Dead?


Demographics dead? 2 Camps

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Demographics OnlyGeo-Demographics AND Lifestyle

comScore Adweek, Trendwatching

Nielsen TV and radio ratings Nielsen PRIZM

Experian Experian Mosiac


“Media behavior in today's fragmented landscape is best evaluated by looking at the

‘life stages’ that people experience as opposed to their demographic profiles.”

Are Demographics Dead? AdWeek, by Steve McClellan

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Does Analytics feel overwhelming?

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Is this your nightmare?

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What are the most important business goals? Rank them.

• Customer retention & increased loyalty

• Lead generation

• Increase wallet share

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Your Marketplace

Your Customers

Your Company


No one-size-fits-all even within industries

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Questions to segment?

• Who are my customers?

• How profitable are my customers?

• What do my best customers look like?

• Who are my least profitable customers?

• Why are my customers leaving?

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Surface segments

‣ Market & consumer analysis

‣ Valued OR differentiated products

‣ Brand strategy

‣ Channel selection

‣ Success evaluation

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B2B or B2C?

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B2B Segments

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B2B Consumers

Industry

Revenue Size or Buying

Behavior

Geography

Product line

Purchase location


Analysis: Buying Behavior

• Revenue Amount: Large

• High Value vs. Low Value

• Frequency

• Multi-year measures

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High value vs. Low value

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Tough choices, even for our most lovable customer friends.

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B2C Segments

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Consumers

Demographic

Customer vs

Prospect

Loyalty Program

Geography

Decision Makers

Product line

Purchase Location

Industry


Geo-Demographic + Lifestyle Market Segmentation

• Nielsen PRIZM

• Experian Mosaic® USA

• Environics Analytics Group(Canada)

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Geo-Demo Segments Lifestage Groups

• Zip+ four location

• Demographics

• Lifestyle

• Where to find more (traditional media)

• Where to advertise

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Lifestyle: Nielsen PRIZM

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Market & Trade Area

Segmenting in Execution


Creative signals segments‣ Communication channel

‣ Photography

‣ Key messages and ad copy

‣ Content

‣ Websites

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B2C Property Management Company Business Goals

• Increase income by:

• Increasing quality and # of (prospective) residents.

• Decreasing resident move-out rate.

• Create a consistent, more modern company and community brands to strengthen brand recognition and appeal to the next generation.

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Marketing Segmentation Strategy

• Lifestyle: long-term rental home, peaceful/quiet, seek community with neighbors

• Demographics: income, age

• Life stage: mother/child, retirees

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Lifestyle & demographic segments

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(Young) families

Young professionals

Long-term Renters

Service & Blue Collar Industries

work smartAll images and content © Copyright 2014, The Roan Group

Lifestyle & demographic segments

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Single Parents

Income range

work smartAll images and content © Copyright 2014, The Roan Group

2nd Target: Seniors (50-65) who want community

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B2B Branded Communications Manufacturing Company Business Goals

• Increase sales and revenue.

• Increase customer numbers.

• Diversify into new industries.

• Clarify, position and strengthen the brand, full range of products, and its case for value.

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Marketing Segmentation Strategy

• Product diversification: photography, website, and channel diversification

• Social media diversification

• Word-of-mouth sales campaign to diverse industries

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Widen Industry Segment to creative projects

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Commercial Real Estate

Property Management

Residential Real Estate


New Industry Segments

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New Clients with creative products

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Your target audience?

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Geographic Segment

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Your target audience?

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Business size segments: Albemarle County’s largest

• $2.8B

• $349M

• $252M

• $4.6M

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Growth Opportunities: Albemarle County Economic Development focus

• Biotech & Medical Devices: 20% of Virginia’s biotech industry

• Business & Financial Services: State Farm, Stellar One Corporation, and Coventry Health Care Insurance

• IT and Defense: Northrup Grumman

• Agribusiness and Food Processing

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Buying behavior segmentation

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FY09 FY10 FY11 FY12 FY13

Lost -$1,824,064 -$5,431,968 -$2,632,784 -$18,437,026

Retained $595,377 $1,059,004 $2,243,962 $3,827,261

New $2,419,441 5,895,595 3,639,696 18,771,081 9,277,599

Re-Acquired $268,285 $308,545 $384,085

Active Accounts $2,419,441 $6,490,972 $4,876,746 $22,264,287 $13,873,657

Running Churn -$1,824,064 -$7,256,032 -$9,888,816 -$28,325,842


Segment marketing by engagement type

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Communications Channel

Email Behavior

Web Behavior

Mobile Behavior

Inbound

Sales Team


Increased Email Response‣ Segment email campaign

‣ After cart abandonment through multiple channels

‣ Retarget

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eMarketer, Email Marketing Benchmarks 2015: Are Performance Metrics Revealing Signs of Consumer Fatigue


Segmented Email Campaigns

• Opens: 15% higher than non-segmented campaigns.

• Unique Opens: 11% higher than non-segmented campaigns.

• Clicks: 55% higher than non-segmented campaigns.

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May 2015 MailChimp Study


Spend more on mobile?

58Beloved Brands


Mobile ad: Simple & Short

‣ Drive awareness

‣ Quick purchases

‣ Reinforce other channels

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‣ 56% social media users

‣ Make 85% of HH buying decisions.

‣ Hold 51% of jobs

‣ Purchase 58% online retail

‣ Senior women control $19T & 3/4 of US wealth.

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48%52%

Female Male

Pew Internet & American Life Project, project of Pew Charitable Trusts She-Economy.com, Mass Mutual Financial Group US Census

Female segment: 52% of Albemarle County is female

http://She-Economy.com


Design for women

‣ Design whole experience; ads, packaging, retail environment, and service.

‣ Emphasize benefits over features.

‣ No hyper-feminine stereotype.

‣ Focus on life stage, 25 or 65? Mom or CEO?

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African Americans and Hispanics embrace mobile

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Pew Research Center

Pe

rcen

t

0

14

28

42

56

70

Texts per day

31%

49%

70%

Black Hispanic Whites


Lifestyle: Moms

• Motherhood is the #1 trigger for social media usage.

• Pregnancy and birth triggered 94% of moms to seek out information and share opinions with others online.

• The 80/20 rule never fails. 18% of social moms wield 78% of the overall influence.

• Mom bloggers are effective but just the tip of the iceberg.

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Don’t forget the CEO channel.

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Repeat communications increase believability

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Informed publics age 25-64

2%3%

6%

8%

26%

33%

22%

Twice (2)Three (3)Four to Five (4-5)Six - Nine (6-9)Ten or moreOnce (1)Don’t know

Edelman Trust Barometer

Summary


Segment Choice Summary

• Customer/Prospect

• Demographic

• Geography

• Industry

• Purchase location

• Products

• Revenue/Profitability

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• B2B or B2C

• Buying behavior

• Consumer needs

• Engagement channel

• Growth industries

• Lifestyle

• Pain point

• Purchaser

Internal Customer

Where do I get more consumer knowledge?


CreativityInsightsResearch & Observations


Compile your data

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+

Web

Email Response+

In Store+

Purchased Data


Internal Data Sources

• Strategic Plan inputs and identified needs

• Customers: Qualitative & Quantitative Research

• Acquisition and Churn Analysis: current vs. updated segmentation model

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External Data Sources

• Non-competitive industry collaborative (outside your market)

• Signal brands

• Market (competitive and complementary) research

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Connect with me Wendy Roan

[email protected] 202.549.7954

LinkedIn: http://linkd.in/olPirZ

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mailto:[email protected]

http://linkd.in/olPirZ