The Power of Segmentation

Inadequate segmentation can waste precious resources and overlook valuable market niches for revenue opportunities. It can drive market messaging to the wrong place, leading to:

High costs with low returns: Spending significant amounts on marketing campaigns that do not yield the expected results.
Difficulty measuring impact: Tracking and understanding which marketing efforts are effective can be challenging, leading to wasted resources.
Generic messaging: Broad, unfocused marketing messages that fail to connect with specific audience segments, reducing the overall campaign effectiveness and ROI.

Our Advice

Critical Insight

Effective market segmentation is essential. It provides a clear path forward by identifying lucrative market segments for targeting efforts. Proper research should highlight segments with significant profit potential readily identifiable within the population or industry. The goal is to enhance market share and profitability through strategically marketing to precisely defined segments.

Impact and Result

Detailed market analysis
Robust segmentation framework
Financial and data-driven decisions

The Power of Segmentation Research & Tools

1. The Power of Segmentation – A step-by-step document for Product and Product Marketing professionals that walks you through understanding how to segment your products for the right audiences based on marketing best practices.

Learn why effective market segmentation research is essential.

Find a clear path forward by identifying market segments for targeted efforts.

Properly segment using readily identifiable segments for B2B and B2C products.

Learn to refine your approach by assembling a skilled team with well-defined objectives and goals to enhance market share and profitability through strategic marketing to precisely define and measure your segments.

2. The Power of Segmentation Executive Presentation – A presentation template to summarize your market segmentation map.

A visually engaging and data-rich segmentation map, categorizing each segment with in-depth profiles for management approval of the project.

The Power of Segmentation

A step-by-step guide to creating segmentation for targeting and positioning for market success.

Analyst Perspective

The power of segmentation

Inadequate segmentation can waste precious resources and overlook valuable market niches for revenue opportunities. It can drive market messaging to the wrong place, leading to potential losses and missed opportunities. Thus, you are wasting time and losing potential market advantages and investments. This underscores the need for a thorough and well-understood market and customer segmentation process.

Effective segmentation empowers businesses to precisely target specific customer needs and preferences, leading to more efficient resource use and improved customer satisfaction. It mitigates the risk of relying on gut feelings and ensures that fact-based, data-driven options are available for these strategic product marketing decisions. By embracing a structured segmentation framework, companies can achieve stakeholder consensus, enhance their market understanding, and can adapt to dynamic conditions.

Remember, the opportunities you miss are readily available to your competitors if they do their planning. Why would you not leverage the power of segmentation to its fullest potential to strengthen your market position and unlock growth opportunities that might otherwise remain hidden from your decision-making?

Joanne Morin Correia, Principal Director, Marketing

Joanne Morin Correia
Principal Director, Marketing
Info-Tech Research Group

Gain the power of segmentation

Pain Points	Obstacles	Info-Tech's Approach
High costs with low returns: Spending significant amounts on marketing campaigns that do not yield the expected results. Difficulty in measuring impact: Tracking and understanding which marketing efforts are effective, leading to wasted resources. Generic messaging: Broad, unfocused marketing messages that fail to connect with specific audience segments, reducing overall campaign effectiveness and ROI.	Inefficient marketing spend: wasted resources on broad marketing campaigns that need to effectively reach or resonate with their target audience, leading to poor return on investment (ROI). Customer retention: Generic product offerings and messaging make retaining customers and building loyalty harder. Reduced competitive advantage: Lack of the insights needed to tailor their offerings and marketing strategies to distinct customer segments.	Adopting a comprehensive market segmentation plan offers a range of benefits that can significantly enhance a company's marketing effectiveness and overall business performance. Following a structured process will allow for a data-driven approach to segmentation to test, adapt, and improve chances for success continually. Detailed segmentation analysis. Robust segmentation framework. Financial and data-driven decisions.

Info-Tech Insight: Effective market segmentation is essential. It provides a clear path forward by identifying lucrative market segments for targeting efforts. Proper research should highlight segments with significant profit potential readily identifiable within the population or industry. The goal is to enhance market share and profitability through strategic marketing to precisely defined segments.

Maximize market share and profitability through effective segmentation

Effective market segmentation research is essential, providing a clear path forward by identifying lucrative market segments for targeted efforts.

Proper research should highlight segments with significant profit potential that are readily identifiable within the population.

In contrast, inadequate segmentation wastes resources and misses opportunities to define and reach valuable niches unknown to competitors.

Refining your approach involves assembling a skilled team with well-defined objectives. The goal is to enhance market share and profitability through strategic marketing to precisely defined segments.

Effective segmentation requires principles

Segmentation is…

Actionable: Segments must be practical and feasible to target with specific marketing strategies.
Measurable: The size and purchasing power of the segments must be quantifiable.
Substantial: Segments should be large and profitable enough to warrant targeted marketing efforts.

Segmentation is not…

Vague or general: Segmentation that is too broad, such as "all males" or "all young people," is not effective.
Based on assumptions: Segmentation should be data-driven rather than based on assumptions or stereotypes.
Difficult to reach: If a segment is not accessible through your marketing channels, it is not practical to target.

Info-Tech Insight:

By focusing on actionable, measurable, substantial, accessible, differentiable, and stable segments, businesses can better tailor their marketing efforts, improve customer satisfaction, and increase profitability.

Avoiding or ignoring market segmentation will significantly impact a business.

Inefficient Marketing Efforts	Decreased Competitive Edge	Missed Growth Opportunities	Poor Customer Understanding and Satisfaction
Without segmentation, marketing campaigns are likely to be generic and less effective, leading to lower ROI. The lack of targeted communication means missed opportunities to connect meaningfully with specific customer groups.	In today's market, where competitors might be leveraging segmentation to refine their strategies, not doing so can lead to losing competitive advantage. This could result in losing market share to competitors who better understand and cater to the specific needs of their customers.	Market segmentation helps identify lucrative niches and unmet customer needs. This insight is necessary for opportunities for growth and expansion to be noticed.	A one-size-fits-all approach to marketing and product development often results in offerings that only partially meet the varied needs of different customer groups, which can lower customer satisfaction and loyalty.

Your segmentation process has an enormous impact on market success

80% of companies that use market segmentation report increased sales.¹

¹ Emergen Research, 2023.

High failure rate of new product launches
Significant loss of potential revenues
Lack of vetted information to drive your marketing strategies
Boost your email revenue rates
Enhanced targeting
Improved campaign performance

Info-Tech's methodology for the power of segmentation

	1. Market Segmentation	2. Target Market Selection
Phase Steps	1.1 Identify team responsibilities 1.2 Identify basis for current segmentation 1.3 Determine segmentation criteria	2.1 Profile segments 2.2 Evaluate segment attractiveness 2.3 Select target segments based on strategic fit and growth potential
Phase Outcomes	Current market segments identified: The current products are mapped to target markets. Creation of criteria for variables for market segments: This process results in the creation of distinct criteria for market segments after collecting and analyzing market data and identifying the basis for segmentation (e.g. age, income, buying behavior).	Identified target segments: Identify the most attractive and strategically aligned market segments to focus on. Segment allocation plan: A plan for effectively allocating company resources to serve the selected target segments based on their potential for growth.

The Power of Segmentation

Effective market segmentation is essential. It provides a clear path forward by identifying lucrative market segments for targeting efforts. Proper research should highlight segments with significant profit potential that are readily identifiable within the population or industry. The goal is to enhance market share and profitability through strategically marketing to precisely defined segments.

1. Market segmentation

1.1 Identify team responsibilities
1.2 Identify basis for current segmentation
1.3 Determine segmentation criteria

2. Target market selection

2.1 Profile segments
2.2 Evaluate segment attractiveness
2.3 Select target segments based on strategic fit and growth potential

Increased marketing effectiveness
Enhanced customer satisfaction
Improved product innovation
Better competitive positioning
Adaptability and market responsiveness

Example of segmentation chart

80% of companies that use market segmentation report increased sales.¹

¹ Emergen Research, 2023.

Are you feeling these pains?

High failure rate of new product launches
Significant loss of potential revenues
Lack of vetted information to drive marketing strategies

Would you like to…?

Boost your email revenue rates
Enhance targeting
Improve campaign performance

Blueprint deliverables

The Power of Segmentation Storyboard
This qualitative market segmentation analysis includes current and future states with a segmentation framework diagram and a TAM analysis to help with a market segment analysis.

Example of a power of segmenation flow chart