A successful segmentation deployment is the cornerstone of a customer-centric business. It involves three clear interventions from the outset: setting a clear ambition; adopting hybrid principles; building a plan for deployment.
In our recent hybrid segmentation blog series, we talked about hybrid being the gold standard survey segmentation that can be tagged onto customer databases. Here at Bonamy Finch, we strongly believe that hybrid principles are important for all clients, in all sectors, for all segmentations, irrespective of whether you have a database or not.
Today, we’ll focus on the second intervention – taking you through the hybrid principles, and how data connections help clients with and without a customer database.
Principles of hybrid
In short, there are three hybrid principles to maximise all segmentation ambitions and activation possibilities:
- Integrate data connections.
- Create the right segments from a mixture of drivers.
- Connect back to as many sources as possible.
1. Integrating data connections
This is about obtaining the right samples and data connections up-front to inform design and maximise activation possibilities.
From a client activation perspective, today’s digital landscape is putting extra pressure to extract tangible commercial value from available data, and unless you are connecting your segments to other data sources, you are limiting your use cases and activation possibilities.
We often look to a hybrid of samples to help with this. A market sample for opportunity sizing – to aid brand positioning, innovation and media buying to help attract prospects. A customer sample to test positioning against existing customers AND to connect survey responses to valuable internal data assets – helping make the segmentation operational for CRM communications.
But if you don’t have a rich customer database, we can still take advantage of customer samples. For example, we’re working with a charity where we’re using customer samples as learning datasets for meta and google look-a-like modelling, to be able to target eventual segments digitally, with the right message, at the right time.
It’s also not just about your data assets, for example, building in TGI statements into your survey design, to allow yourself the possibility of connecting segments to media profiling.
2. Creating the right segments
This is about driving the segmentation on the right types of data to meet all ambitions, to provide targets where activations trigger a response.
Whilst demographic, attitudinal, needs, behaviours, each have their own merits in creating a segmentation, each have pitfalls when used to drive a segmentation in isolation. In contrast, a hybrid of different inputs driving a segmentation helps to provide not just richer segments, but help to meet multiple ambitions, with each driver having its own purpose.
For example, for a broadband company, we identified that there was a strong link between specific household demographics and motivations that resulted in differing product choices and usage. Quantifying which inputs were more related to actual behaviours meant we could focus the segmentation on a combination of what matters, making the segments easy to target and more likely to trigger a response. In the first two quarters after incorporating the segmentation, our client was able to acquire 7% more of their target segment from the market.
But it’s not just about identifying the right drivers, it’s about defining the purpose of your segmentation against ambitions up-front. For example, we created two segmentations for a travel company. 1) A traveller segmentation, covering the enduring relationship with researching and booking holidays. 2) Trip-based segmentation to reflect that a person’s needs changes from their cultural city break with their partner versus their fly and flop holiday by the beach or pool with their kids.
The trip segmentation was setup for white space and innovation (creating new holiday offers), whilst the traveller segments were used for brand positioning, service, and communicating the trip types in different copy and tone. Defining this up-front meant we could really focus each segmentation to specific use cases and deployment.
3. Connecting back to other sources
This is about deploying to the right places to keep the segmentation alive, allowing multiple business functions to deliver ROI and work to the same goals.
Hybrid segments (built from multiple inputs) are naturally more relevant to a wider internal audience:
A) Different departments typically hang-on to different parts of the segmentation description, but importantly, each will have the same overview and core targets to attract and keep.
B) Integration with common internal or external data sources provides segmentation lens on data used day-in-day out, which leads to higher adoption of the segmentation.
Algorithms are an important step in keeping segments alive:
- Golden questions allow you to add questions into future surveys and tag respondents with a segment code – which continues to allow further interrogation of segments on different topics. Adding into both ad-hoc surveys, as well as continuous research like brand trackers, customer satisfaction programmes or applying to a selection of customers at various touchpoints to track behaviours of segments over time.
- More and more companies are also in the fortunate position of receiving database attribution algorithms – machine learning algorithms to assign segments to the rest of the customer database without the need for research questions. This opens up a plethora of personalisation possibilities which we’ve talked a lot about in previous blogs.
If you’re not lucky enough to have a rich customer database, you can still connect the segments to traditional media and digital media targeting. If you have a basic customer database, you can connect through to digital look-a-like modelling. Even if you don’t have a customer database, you can still use the segmentation to inform your digital targeting approach – hybrid segmentations are built on different inputs to make targeting easier, whilst further research on hobbies, interests and media usage further focusses targeting and communications.
Clients are under more pressure to maximise return on segmentations. I think it’s fair to say, that once you’ve seen the power of hybrid, it’s hard to go back to creating a segmentation from just one input. You’ll also regret ignoring possible data connections to increase activation potential.
A successful segmentation deployment is the cornerstone of a customer centric business. To create a truly transformational segmentation, you must set a clear ambition, adopt hybrid principles, and build a deployment plan.