BRANDiosity's small business segmentation learnings...
We recently completed a nine month project with one of the largest transportation services companies in the world that focused on segmenting the small business opportunity in the US. We used a 5-step process that began with a comprehensive situation assessment and culminated with detailed strategic implications & brand architectures for the priority segments. Along the way we learned a great deal about what to do and what not to do when it comes to segmenting small business:
§
One Size Does Not Fill All: When it comes to segmenting this large and diverse universe there are countless ways to skin the proverbial cat...the segmentation methodology has to take many factors into account: from the competitive context to the organization's practical limitations in terms of how to activate the segmentation. As part of the process we interviewed a number of best in class companies about their approach to segmenting small business and found that their approaches varied from being intentionally simplistic to complex hybrids. What was consistent among all of these best in class companies was their recognition that the small business universe behaved differently, merited a targeted effort, and developed a segmentation scheme that became the cornerstone of their overall small business strategy.
§Don't Rush To Judgment: We pride ourselves on conducting extensive due diligence prior to fielding any research, but particularly when it comes to a segmentation study. Many times the practical needs of the business and internal pressures dictate moving into the research phase quickly and sometimes too quickly. Once again we found that the time spent up frond developing and refining hypotheses that would later shape the segmentation research design was invaluable. Survey instruments are intentionally limited in length and investing to better understand the context up front helps us maximize how we use this valuable real estate.
§Make Your Segmentation Enterprise Centric Not Marketing Centric: An effective segmentation and corresponding strategy can literally die within an organization due to the 'not created here' syndrome or simply because it does not meet the needs of different functional areas beyond marketing (typically sales). We found that the involvement of a senior cross-functional team throughout the project ensured that other functional areas felt represented, engaged, and more importantly, that their needs were being met. Most importantly, the process must take into consideration the existing or legacy segmentation models that the organization might be tied to. These simply cannot be ignored...intersections must be identified and explained.
§Prepare For Socialization: Many firms are guilty of believing that the work ends once the target population has been segmented and profiled. Yet others believe that it ends once you have developed a strategy to address the segmentation which has been revealed. Few companies realize that there is still one critically important step in the process: socializing the segmentation study results and strategy effectively across the organization. This is particularly important when the work reveals findings that challenge longstanding paradigms. The socialization effort needs to be planned ahead of time and executed methodically versus an ad hoc manner.
Download:
BRANDiosity_Small_Business_Segmentation_Learnings_7.23.09.pdf
