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Segmentation Studies

Market segmentation is used as a strategic marketing tool for defining markets and thereby allocating resources. Segmentation studies use statistical techniques called factor analysis and cluster analysis to combine attitudinal and demographic data to develop segments that are easier to target. In many situations, it is better to identify your target groups and aggressively market to smaller, more defined segments.

Market segmentation is concerned with individual or group differences in response to specific market variables (e.g. preferences, lifestyles, media habits, etc.). The strategic presumption is that if these response differences exist, can be identified, and are reasonably stable over time, and if the segments can be efficiently reached, the company may increase its market share beyond that obtained by assuming market homogeneity. 

Methodology

  • Conduct qualitative research to gain a general understanding of purchase and usage behaviour.
  • Conduct quantitative research to determine purchase and usage patterns by segment.
  • Conduct cluster analysis to segment the market.

Queries that are solved:

  • What is the purchase process for the product market, by user segment?
  • How do users work with these products, by user segment?
  • What can be done to increase the likelihood of purchase, by market segment?
  • Specific product features/attributes
  • Pricing
  • New distribution channels
  • How can usage be increased within segments?
  • What are the types of things they would like to be able to do with these products?
  • What is the likelihood of the purchase of our product and competitive products by non-customers, by market segment?
  • How are competitors' customers using competitive products, by user segment?
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