Segmentation and the power of focus

The more companies I talk to, the more convinced I become that thinking clearly about the segments you serve is the key to effective marketing.

The value of segmentation is really that it causes you to be objective about the kinds of people who will find your products and services interesting. Objectivity includes understanding the positive and negative aspects of each segment’s needs, frame of reference, and belief system.

I find that belief-based segmentation is the most powerful: if you can accurately characterize the beliefs of your various segments, you can build value propositions that speak to those beliefs. People’s behavior is driven to a large degree by their belief systems. Here are some of the beliefs you might find in your customer base that might indicate how easy it will be to sell to them:

• Cost is king
• It’s all about quality
• We are a conservative company
• We’re leading edge
• Buy locally made
• We want partnership, not transactions
• Our focus is innovation
• We emphasize safety and predictability

There are many more, and they have to do with company brands, company mission statements, and the perhaps unwritten cultural elements of your customers. It’s probably obvious to you why these things matter: it’s harder to sell an avant garde product to someone who believes conservatism is an important aspect of their brand.

So the goal is firstly to identify the most important beliefs that characterize your potential market, and then to craft messages and strategies ...