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Segmentation has long been a fundamental strategy for businesses seeking to understand their customers better. It forms the bedrock of positioning, targeting, innovation and communication strategy. However, as the business landscape evolves, traditional segmentation methods are revealing their limitations, making room for a more advanced and comprehensive approach – hybrid segmentation.

In this blog post, we’ll explore the shortcomings of traditional segmentation and why embracing hybrid segmentation is the key to unlocking a deeper understanding of your customers and achieving meaningful engagement.

The foundation of marketing: Segmentation

Segmentation is the process of dividing a customer base into groups, or segments, based on shared characteristics, behaviours, or preferences. These segments serve as the building blocks for crafting tailored marketing campaigns and delivering personalised experiences. Historically, two primary approaches have dominated traditional segmentation: survey-based segmentation and database customer segmentation.

Traditional segmentation approaches: Challenges

Survey-based segmentation:

Survey-based market segmentation helps you understand what makes your current and prospective customers tick. It looks at higher level and category-specific attitudes and motivations, helping you tailor your brand, products, pricing and communication to appeal to specific groups.
However, survey segmentations aren’t tagged onto your customer database, meaning propositions can’t be targeted effectively to the right customers with the right message. This also makes marketing initiatives harder to prioritise and measure success.

Database customer segmentation:

Database customer segmentation relies on transactional and engagement data from your existing customer database, lending itself more towards tactical eCRM targeting.

However, without a deep understanding of ‘why’ customers behave as they do, personalization efforts become challenging. Customers may receive generic messages that don’t resonate with their specific needs and preferences. You’re also limiting yourself to current customers, and will fail to address the needs of potential customers rejecting your current propositions. Often, database segmentations become a tool to drive promotions rather than building long-term engagement with the brand.

Separate, parallel survey and database segmentation:

Having separate survey and database segmentation processes can lead to misalignment within your organization. Different teams may have conflicting views of customer segments, hindering cohesive marketing strategies.

Hybrid segmentation: The comprehensive solution

Hybrid segmentation tackles these problems head-on, combining the strengths of both survey-based and database customer segmentation while mitigating their limitations. 

Here’s how it works:

360-degree customer view:

In our last blog series, we talked a lot about unlocking the commercial value of your data. Hybrid segmentation integrates customer data, survey data, and third-party marketing data to create a holistic view of your customers. It answers both the ‘what’ and the ‘why’ behind customer behaviours, providing a more complete understanding.

Machine-learning algorithms:

Machine-learning algorithms attribute segments to your database, enabling personalized marketing and engagement at scale. This means you can deliver tailored experiences to individual customers more efficiently.

Unified teams:

With hybrid segmentation, all teams within your organization have access to the same information, fostering alignment and ensuring that everyone shares a common focus. This leads to more successful activations and cohesive strategies.

Many have experienced the frustrations with having separate, parallel survey and database segmentations. Embracing hybrid segmentation offers several compelling advantages.

Stay tuned for our upcoming blog posts, where we’ll delve into each of the benefits of hybrid segmentation in more detail, showcasing real-world success stories that demonstrate its impact.


An introduction to hybrid segmentation

Download our ebook to learn more about how this advanced approach to segmentation will elevate every customer interaction you have, fuelling business growth.