Many of the mistakes and failures associated with the launching, repositioning, or any other commercialization formula for products and/or services have their origin in a poor Segmentation Strategy. The majority of the critical decisions General Directors and Sales and Marketing Departments face daily derive from the segmentation of the customer portfolio or the potential market. That is why it is vital to segment intelligently and profitably.
Segmenting is dividing customers in categories or similar groups in order to distinguish what will be done with them. It is necessary for companies to differentiate between two basic types of segmentation: Strategic Segmentations aim to organize the company according to the principal customer segments and act on them (for example: business or residential in the case of telecommunications), while Tactical Segmentations, based on much more operative customer profiling, have more specific goals “in the field”: obtainment, retention, loyalization, cross-selling or up-selling, to name a few examples.
The criteria on which Segmentation Strategies have traditionally been based are still valid, but new variables have been added to them which are equally essential. New key criteria are being added to the conventional psychographic criteria (“brand name” customers, “similar to promotions”, etc), demographical (youth, housewives, immigrants, etc) and behavioral (“savers” vs. “in-debt”, “leisure lovers” vs. “homebodies”, “traditional families” vs. “professional couples without children”, etc.) In particular, we must always keep the “customer value” element in mind, in order to optimize which resources are dedicated to each customer group, according to what the customers bring to the company, as well as the life phase the real or potential customer is in. In other words, segmentation by “purchase occasions” (“fathers of newborns”, “students that become independent”, etc).
Managing different focuses and variables, the ultimate end is to design strategies that define as exactly as possible which segments must be reached, establishing a made-to-order Customer Plan for each one of them. These Segmented Customer Plans will allow us to go beyond the mere identification of segments in order to become a true “segment management”, establishing with a high level of accuracy what investment to be made in each segment, which sales resources to assign to each one, what prices, what Sales and Marketing actions to implement, which sales channels, etc…
It is time to put to an end the policy of “coffee for everyone”, which has presided for too long over the relationship with the customer. The “Coffee for everyone” method punishes good customers and rewards bad ones. Only a correct Segmentation Strategy places each one in the place they belong.