Research Solutions
Market Segmentation
Customer segmentation is the practice of dividing a customer base into groups of individuals that are similar in specific ways relevant to marketing, such as age, gender, interests, spending habits, and so on. Using segmentation allows companies to target groups effectively, and to allocate marketing resources to best effect.

Customer segmentation is carried out by means of a cluster analysis on the basis of collected data and by questionnaires with key segmentation questions.

An ideal market segment meets all of the following criteria:

  • Social and demographic segmentation: gender, age, social status, income, family status, etc.,
  • Psychometrical segmentation: similar life styles (hobbies, leisure) and values, as well as consumption psycho-types (based on personality clusters ranging from inventors/early adopters vs. laggards classification up to a more profound classification of an individual’s needs - from physiological and safety needs required for survival and up to self-esteem and self-actualization needs to express and demonstrate one’s inner abilities, etc.),
  • Behavioural segmentation towards the studied product (loyal, forced to be loyal, “switcher”, dissatisfied brand user, etc., or hard-core loyal – aware of the product, somewhat aware of the product, unaware of the product; or the frequency of use, etc.).

In a similar fashion, industrial markets could also be segmented on the basis of a number of attributes.

Feasibility is the corner stone for Business Analytica consumer segmentation analysis. If a qualitative study has rendered a number of hypotheses they will all have separate clusters of questions within a follow-up quantitative study. Once the fieldwork has been finalized the Agency analysts will examine the data to identify which attributes constitute the most stable and meaningful clusters for the marketing segmentation. By meaningful we mean the subsequent possibility for the customer to work with these key segments, develop dedicated marketing campaigns to attract and retain consumer loyalty. The attribute which renders the most meaningful segments is described as feasible. If other studied attributes render less precise segmentation clusters or deliver over 8 clusters in total, such attributes are of little value to the marketer and they are described as infeasible.