Geo Strategies undertakes demographic, attitudinal, behavioural, health and wealth segmentations of the Romanian population and elsewhere in CEE.
Discriminate customers to target them in a more relevant manner
Consumer classifications or segmentations provide a simple method of accessing the wealth of demographic, lifestyle and behavioural information by classifying consumers into a single, homogeneous code.
Useful segmentations strike a balance between those having a large number of categories and those with only a few categories. Too many result in “noise” i.e. data which fluctuates wildly; too few means that the stereotypes are too “averaged” and become meaningless.
There are two basic approaches to a segmentation – a priori and post-hoc.
A priori segmentations start from an assumption of meaningful categories (gender, age, ethnicity, life-stage, education, employment – or some combination) and then attach attributes to these categories from an analysis of the available data.
Post-hoc segmentations do exactly the opposite: they start with the data and use various data-mining techniques to establish the categories. Once this has been achieved, the categories (and data) are examined in depth to understand the underlying meaning – what is it about those categories that make them significantly different?
At Geo Strategies we specialise in post-hoc segmentations as we believe that these provide true insight into the market or group of people &/or behaviours of concern.
Every organisation has a number of customer-based problems to address. Whether the concern is for customer acquisition, customer retention, up-sell, cross-sell, churn or risk, a well thought-through approach to segmentation will yield benefits far beyond the investment involved.
The list below itemises some approaches:
Socio and geo-demographic segmentation
Where people live, their age, culture, household composition, behaviour, employment, finances and lifestyle extrapolations.
Current value, potential value, lifetime value, value deciles, contribution.
Transactional data collected on how customers use products and services, including credit risk.
Attitudinal & needs
Core values, needs and reasons customers use products and services, usually identified through market research.
The channels, privacy and relationship people prefer.
Customer state segmentation
Time-based segments, showing a customer’s position in an event, process or relationship cycle.
Segments in real-time to take advantage of fleeting opportunities.
Segmentations and market research
Many companies rush into segmentation by starting with market research. Customers and prospective customers are asked what they want, need and do, and the research project then builds segmentation models.
In our approach market research still has a key role to play; just a different one and at a later stage in the process. Use the initial analysis to define the customer segments to be researched and the reasons why. Then create a brief for market research and carry out the research based on the data-driven segments, ensuring at each stage that the outputs will be actionable.