Are You Effectively Using Market Segmentation?

All of your customers get to you by different paths.

Maybe I like a new television show because I dig the action, the subject matter or the rapid-fire dialogue. Perhaps you like it, as well, but you’re drawn to the comedic relief between action scenes and to the emotional resonance between characters. Or maybe you just like to look at the pretty actors who populate the cast.

It doesn’t matter. We both like the same thing, but for different reasons.

As your business grows, you might notice that a similar pattern emerges. For example, let’s say you run a home security company. Some of your customers might buy security systems because they live alone and travel frequently. Others could choose your service because they have small children to worry about, or because they live in a crime-ridden neighborhood.

In this situation, market segmentation is key, as different marketing messages resonate with different target markets.

Create Distinct Marketing Targets

When entrepreneurs ask me about marketing segmentation, I advise them to create detailed buyer personas. You can name them whatever you want — Frugal Fred, Risk-Averse Renè, Comparison-Shopper Carl — and get to know them as intimately as you know your best friends. What does each person want and need?

Consider these question to develop personas for B2B Customers

  • What drives their decision making?
  • What are their business challenges?
  • Do they have any obstacles to doing business with your company?
  • What is their budget cycle?
  • What are their careabouts?
  • Is there an entrenched incumbent?
  • What would it mean to them if they solve their business challenge?
  • Where does this person get information? (social media, podcasts, industry publications, newspapers)
  • How will using your service/product make a difference to them?

Consider these questions to develop personas for B2C customers

  • What is this person’s family life like? (single, married, kids etc.)
  • How do they interact with the businesses they patronize?
  • What is their biggest need?
  • What are the obstacles to solving their problem?
  • Do they work outside the home?
  • What is the household income?
  • How much education do they have?
  • What motivates them? (Time, freedom, fame, money, control)
  • Where does this person spend time online?
  • What are the keywords and hashtags they use?

Once you’ve created buyer personas, decide how you’ll market to each one. Set up distinct marketing messages for each buyer persona so you can hit specific pain points and speak to that consumer’s unique drivers, habits and circumstances.

Want an Easy Way to Test Your Buyer Personas? (Of Course, You Do)

Create landing pages on your website to appeal to each buyer persona, then offer a free download for everyone who lands on that page and signs up for your email list.

Use social media and online advertising such as Facebook ads to drive traffic to your landing pages. Just make sure that the freebie appeals specifically to the buyer persona. For instance, Frugal Fred doesn’t want to read a white paper about buying top-of-the-line security technology for his home.

If you tie each signup page to the persona you’ve created, you will have create a targeted marketing list. When you send out emails and other communications, you will not use the same message to pitch or engage each target audience instead you will focus on the specific persona to craft your marketing message.

Segmentation can take many forms:

  • Geographic: Some products and services appeal only to people in specific parts of the country.
  • Socio-Economic: Some customers are luxury buyers and can afford higher-quality/higher priced products and services.
  • Early Adopters: Regardless of financial circumstances, early adopters often spend more money on great products because of basic desire to be the first one to have the latest tech gadget.
  • Family Structure: Singles and couples without children have different buying habits and disposable income from young families and couples with college kids.
  • Values: Your customers’ beliefs and values can influence their shopping habits. If they are more concerned about the environment and antibiotics in the food supply, you might only shop organic or buy non-toxic cleaning supplies.

Sketch out engagement scenarios for the persona

Once you have your personas you want to develop a pitch to engage them. Your first outreach will most like be with some type of content, live presentation or product sample. Come up with at least three different ways to approach your target personas to start building the relationship.

Market Each Product or Service Differently

As your business grows, you’ll likely add new products and services to meet the growing demand. You always need to go back to your personas as you drill down on the granular details for each new product or service to make sure there is alignment. Do you have a persona that you new offer could appeal too? How can you market it effectively with that knowledge in mind?

Only you can decide how you want to segment your target customer. After all, you know your customers best.

I’d like to learn how you apply this small business advice to your own company. Do you plan to segment your audience in the future? Let me know by friending me on Facebook and joining my ongoing conversation about entrepreneurial tips and strategies.

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