Traditional market segmentation seeks to divide the market into homogenous groups based on characteristics such as gender, race, geographic location, income, and psychographic profile. It is assumed that these groups will naturally have common needs, demand the same product and service qualities, and respond similarly to market interventions. It is also assumed that these segments will exhibit similar purchasing behavior because of these shared attributes. The glaring issue with segmentation based on demographic, geographic, and psychographic characteristics is that these qualities are not necessarily linked to behavior. It does not recognize the contextual filters that affect
perceptions or decisions, nor does it account for learned habits controlled by the unconscious mind.
How Should I Expect from Behavior-Based Segmentation?
Habit-based behavioral segmentation is a human-centered approach that segments the marketplace based on what consumers actually do. Our behavioral segmentation projects begin with a two-sided habit analysis of how your customer base purchases and uses your products or services. This analysis uses company data, observation, and deep interview techniques to separate the market into behavioral segments by answering these questions:
What is the Customer's Behavior?
First and foremost to a behavioral segmentation study is the actual behavior of current and potential customers. Understanding the essential elements and complexity of your customers's behavior creates the foundation for the behavioral segmentation process.
How Habitual is the Customer in This Behavior?
Once we have mapped the customers' behaviors, the next step is to determine how habitually these customers perform those behaviors. The level of your customers' conscious engagement will have a profound impact on how to communicate with them.
In What Context(s) Does the Behavior Occur?
Habits occur within contexts both broad and specific. Your customers may only use your product or service in one context, or their behavior may range across multiple contexts. Sublime maps the contexts for your customers' purchase and usage behavior so that messages can be tailored to create contexts and establish cues.
What Reinforces or Punishes the Customer?
Conscious reinforcement gets customers to say they like or prefer a brand; unconscious reinforcement gets customers to repurchase the brand every time they shop. Understanding how feedback can reinforce behavior and using that knowledge to create (and disrupt) habits is critical. By mapping feedback loops, Sublime provides powerful insights into how different segments perceive products and services and how the company should frame product benefits.
The results of behavioral segmentation can range from a simple two-by-two grid to a three-dimensional matrix, depending on the variety and specificity of your customers' behaviors. Once the behavioral segments have been identified, Sublime works with you to develop products, messaging, and marketing tactics that target each customer based on their behavioral characteristics.
What If I Already Have Segmentation?
You may have recently spent money on a segmentation project and have no intention of throwing away the results. Or you may even have high-level behavioral segmentation that divides customers beyond demographics into usage occasions, benefits sought, or experience with the product or service. Though most companies have already segmented their customers, there is typically a lack of strategic integration based on current approaches.
Our behavioral segmentation projects begin with a thorough review of existing segmentation research. These reviews identify gaps that exist between segmentation and the dedication of corporate resources toward those markets that have the greatest potential. Whenever possible, we utilize your traditional segmentation research, unless the results do not impact marketing outcomes. In most cases, traditional segmentation adds depth to the behavior-based approach.
Why Should I Implement Behavior-Based Segmentation?
Segmentation serves two critical goals: focusing corporate resources on markets that have the best opportunity, and helping companies avoid margin-eroding competition. Sublime uniquely segments consumer behavior by its conscious and unconscious underpinnings, a critical differentiation for marketing strategy. This approach enables companies to gain a substantial and sustainable competitive advantage by targeting segments by level of consciousness.
The brain is proficient at disregarding irrelevant stimuli. As such, hundreds, if not thousands, of marketing messages are filtered out each day without ever reaching the conscious perception of potential customers. The messages that do make it through are often ineffective, either because they are immaterial to the consumer's current goals, or because they do not induce any action on the part of the consumer.
Segmenting and targeting based on behavior helps messaging reach consumers in two ways: first, by understanding when and where consumers are consciously engaged with their environment and actively seeking information; and second, by aligning messaging with how consumers unconsciously organize their lives. With Sublime, your messaging has a far greater chance of impacting behavior by communicating at both the conscious and unconscious level.