Segment Analysis
Market segmentation can be defined as the process of dividing a market into groups or subgroups based on distinct needs, characteristics, or behaviour which might require separate products or marketing mixes. The aim is to match groups of potential customers who have the same set of needs and buyer behaviour. Segmentation encourages businesses to use resources effectively, creates value for the target market, creates focus and effective positioning. However, one of the limitations of marketing segmentation is that targeting multiple segments increases marketing costs.
Requirements for effective segmentation:
Measurable and identifiable: it must be possible to determine the key variables.
Accessible: the segments can be reached and served.
Substantial: the segments should be sufficiently large to be served and profitable.
Actionable: programs can be developed effectively.
Unique needs: the segment must respond differently to the market.
Using Segment Analysis on Planium Pro Lite
To complete this section, on the left-hand side menu bar, click the + to expand the ‘Marketing’ menu and select ‘Segment Analysis’
Step 1: Segmentation
The segmentation process begins by identifying all potential segments that the market can be broken into. This is followed by diving further into creating sub-segments if applicable. Lastly, each segment will have different elements that have to be identified and described.
This process will provide a step-by-step guide to segment the market. Add one segment at a time. All the segments identified will be listed below.
Click ‘Next’ to start the segmentation process.
Step 2: Add a new Segment
Choose a common variable for your market segmentation:
- Demographics – age, gender, family status, income, occupation.
- Behaviour – Purchasing behaviour, product usage, preferences, decision making.
- Psychographics – lifestyle, activities, interests, opinions.
- Firmographics (organisation-based)- number of employees, revenue, industry location.
Type the common variable which segments the proposed market in the box below and click ‘Add’. Add as many segments the business may have.
Click ‘Next’ to move to the next step in the segmentation process.
Step 3: Segment Structure
- Segment: If there is sub-segment, then leave this field empty and click ‘Add’
- Sub Segment: only create a sub-segment if the relating segment has sub-segment that have significant difference from one another.
Click ‘Next’ to move to the next step in the segmentation process.
Step 4: Segmentation Details
This final stage produces a summary table where you can identify the type of pricing positioning, marketing strategy and distribution channels should be used in each segment.
Click ‘Save’ to save changes.
Click ‘Chart Preview’ to view the analysis results.
Analysing Segment Analysis Results on Planium Pro Lite
Under ‘Segment Analysis Introduction’, you have an option to leave a pre-written text and use the suggested template or press ‘Switch between Free Text/Template’ to input any introductory information that may benefit your client or investor.
‘Analysis Results’ is the section to write-up the analysis on the graph and describe any key themes that are present in the data. Press ‘Switch between Free Text/Template’ to use the template.
Click ‘Save’ to save changes.
Click ‘Report Preview’ to view the write-up in report format.
