Segmentation is used by many marketing and research companies to separate and divide customers into groups, based on their characteristics. Marketers love the challenge and process of categorising consumers into certain segments where they share similar traits. The hope is that the segmentation process will make targeting consumers easier and improve conversion rates. A recent article titled #BizTrends 2019: the year we rethink segmentation highlights how customers are ever-evolving – and should not be considered as a static segmentation result. Rather, customer behaviour patterns only act as a starting point to better understand the consumer.
It appears as though product life-cycles are diminishing. Here are three reasons why static segmentation research needs to be looked at more carefully:
1. Continual volatility
Static definitions of segments have difficulty addressing the severe levels of volatility that are currently found in consumer behaviour. Lets consider the high unemployment rate amongst the youth in South Africa. How does a youth-orientated brand account for such change, especially the impact it will leave on the segment’s behaviour? As a result, traditional segmentation models are utilised but with extreme complications. These thoughts are shared by the Managing Director of Instant Grass International, specialists in small data.
With 2019 in the full swing of things, we can all agree that the pace of change will not subside. Businesses need to understand how the dynamic environment is changing and then adapt and adjust to these changes. The quicker businesses can improvise these changes, the more they’ll be able to impact their customers positively and add more value.
2. Identifying the action or process
Due to consumers being susceptible to change, they often fit into more than one segment. By shifting their behaviour patterns, they give themselves the opportunity to influence which segment will best benefit them at a given time. Identity curation is when consumers position themselves in order to utilise their vast behaviour patterns, to best suit their needs.
3. Taking ownership and consumer selection
In this day and age, consumers want to make their own decisions and choices. As a result, consumers will choose their own segments that best grab their attention in a relatable way. It’s time marketers allow consumers to take more control and initiative, thereby allowing consumers to choose their own information, products and services that is most relevant to them.
Dynamic segmentation is a concept that will surface in 2019. As a result, fast adapting businesses are building tools that will allow the most recent research to live in real-time. In order to produce realistic outcomes, there are a number of measures that need to be implemented. Avoiding any uncertainties in the decision-making process is a major concern going forward. Therefore, in 2019 we will anticipate and expect a number dynamic segmentation methods.