Random Thoughts
May 8, 2023
Whether you are a small company or a large corporation, devising an effective product strategy (including product design, branding and marketing components) always starts with pinpointing and understanding who your target end-users/customers are. And to do that, a thorough end-user segmentation (identifying all the possible segments there are) will need to be its foundation.
This week, I want to focus on just that—end-user segmentation, or what I like to label as “end-user” segmentation.
But before we go into my philosophy on what proper end-user segmentation should be, let’s first look at how segmentation has evolved over the years as I come to know it. Before the advent of social science, end-user segmentation was often done based on basic demographic data, such as age, gender, marital status, income, and occupation amongst others. And of course, this can be ineffective as not all males 25 to 30 years old think and act the same way.
Then there comes social psychology, and we begin to see psychological data being added on top of demographic data to be more precise and detailed in end-user segmentation. And likewise, this can also be ineffective as it is still not precise enough—not all males 25 to 30 years old who have a happy-go-lucky type personality buy the same set of products.
So where do we go from here?
Clearly, we need to go deeper than just who the person is, we need to look all the way to the root cause of product purchase—the motivations behind it, the reasons why they buy the product in the first place. To me, this is the only differentiator that can identify segments that are distinct from one another, allowing pinpoint product strategy to be created.
It is important to note that rarely there is only one motivational factor behind each purchase by a single person, oftentimes, there are multiple factors—both functionally and emotionally. For instance, someone might buy a cold soda not only because he/she wants to thirst crunch, but also want to cool down from the summer heat at the same time, and emotionally, he/she chose this particular brand of soda because it is a trendy brand that makes him/her look cool drinking it. As can be seen, just from a simple impulse purchase, there can be as much as three different motivational factors.
In any case, once the universe of motivational factors--both functional and emotional--are identified, then you can look back into whom those people are that exhibit each of the different motivational factors, creating a profile for each motivational segment by looking into the surrounding factors such as product level data (e.g. usage occasion, product features seek, etc.), demographics, and as importantly, the life stage that they are in.
The reason why I particularly pointed out “life stage” here is that I felt this category for segmentation is often ignored, but it is one that fundamentally changes a person, and subsequently, changes his/her product choices, and therefore, should be included as part of the key segmentation data.
Early childhood: The childhood years where the person is highly dependent on their parents to make choices for them.
Teenage years: This group is still in school, whether in high school or university. They are now becoming their own person, forming their own opinions. Oftentimes, these are rebellious years against traditions and social norms.
Adulthood: They are in their early 20s and 30s, have very strong opinions of their own, and are not afraid to express them. These are the ego-centric years where their lives are all about themselves.
Early parenthood: The years when they first have children of their own. They are now forced to abandon their self-centric ways of early adulthood and shifted their focus entirely on their children. Their children are now the center of their universe.
Late parenthood: The years when their children are grown up and they no longer have to take care of them. They are now regaining their own self, and beginning to do things for themselves again.
Ultimately, imagine detailed segment profiles being created using motivation for purchase as the core, outlining every aspect of that person from basic demographics to life stage they are in, to their behavior, expectations, and needs around the product (dubbed product level behavior), an effective product strategy with pinpoint accuracy can be drawn out, significantly elevating the chance for success of your product.
Well, that’s all I have to share this week. As usual, I hope this helps you in some way. But feel free to comment and let me know your thoughts. As always, follow us on our LinkedIn page for more!
Comments