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benefits of market segmentation

Unearth New Opportunities and Drive Profits with Customer Segmentation Analysis

With the proliferating marketing platforms today, customer segmentation analysis has become a pre-requisite for businesses to boost sales, reduce attrition, and improve prospect and customer experience. Also, around 70% of CMOs agree that customer segmentation analysis is extremely valuable in providing a great customer experience.

By segmenting customers into various groups that share similar needs, organizations can devise personalized marketing strategies for each group differently and focus on all customer needs at any given time, making marketing and customer care more organized and targeted.

Infiniti’s customer segmentation analysis solutions have helped several Fortune 500 companies devise customized approaches that satisfy the needs of different customer groups and drive customer loyalty and profitability.

Below, we have summarized some of Infiniti’s success stories that highlight how customer segmentation analysis has helped companies to gain a leading edge in today’s competitive marketplace.

Elevating Sales by 17% for a German Retailer with Customer Segmentation Analysis

With a multitude of choices available for customers in the retail industry, developing a robust marketing strategy to target specific customer segments is becoming important in the retail industry. Don’t you agree? This success story is an excellent example of this. A retail company was finding it difficult to segregate the customers in terms of need-based and value-based segments in the German market. Also, they faced issues in managing attrition rate and acquiring new customers. They were looking for a market research firm to help them in segmenting customers based on their value for the brand.

Infiniti’s market intelligence experts helped the client to devise a sound commercialization strategy to effectively engage customers and enhance customer retention. Also, our retail customer segmentation analysis engagement helped the client to elevate sales rate by 17% within a year.

A Leading Fashion Brand Curtailed Losses and Increased Revenues by 20% with Customer Segmentation Analysis

Worldwide e-commerce growth is on the rise, and it has placed immense pressure on fashion retailers to differentiate themselves and provide superior shopping experiences in-store. However, to devise personalized marketing approaches, businesses require a thorough understanding of their customers and their needs. This is where the real benefit of leveraging customer segmentation analysis comes into play.

Customer segmentation analysis can help in dealing with such issues efficiently. This is clearly evident in this success story where the client, a fashion retailer, was facing similar predicaments. The company also encountered a substantial reduction in the number of frequent and repeat buyers.

Infiniti’s customer segmentation analysis solutions helped them to develop a well-aligned business plan to deliver sustained growth and empowered them to break through the cluttered market space with a unique and convincing proposition. Moreover, they were able to improve their wallet share and increase their overall revenue by 20%.

Enhancing Customer Retention Rate by 20% with Customer Segmentation Analysis

In the increasingly fast-paced banking industry, companies need to constantly evaluate the market and expand their offerings. Also, there is immense pressure to improve profitability and customer experience while adapting to the disruption caused by rising FinTech companies.

Our client, a banking company based out of the United States was facing the same dilemma. As such, they were looking for a research firm that could do an independent analysis of potential investment opportunities and provide detailed insights into their customers. Additionally, they wanted to segregate their customers based on their geography, psychography, and behaviors into separate groups and devise customized marketing approaches to gain maximum traction.

Our experts adopted a comprehensive three-phased approach to help the client develop a new customer segmentation approach and predict the future value of customers for the brand. Also, Infiniti’s solution helped the client to analyze the key drivers of customer satisfaction and devise suitable strategies to counter the decline in sales. In addition, they were able to enhance customer retention rate by 20%.

Retaining the Most Lucrative Customer Segments with Customer Segmentation Analysis Approach

Identify and implementing appropriate customer segmentation strategy models to profile and retain valuable customers seems to be challenging for businesses. This is where a custom market research service provider like Infiniti Research can make your work easier, as it did for a transportation services provider. The company wanted to devise a value-based approach to define their best prospects in the market. Moreover, they wanted to profile and target lucrative customer segments and avoid bottlenecks pertaining to the delivery of products.

With Infiniti’s customer segmentation analysis solution, they were able to profile customers into various segments and tailor marketing efforts for them. Furthermore, our customer segmentation analysis approach helped the client to devise a value-based approach to retain the most profitable customers.

Customer segmentation analysis

Customer Segmentation Analysis Increases Sales Conversion and Reduces Customer Churn for a Retailer – Infiniti Research’s Latest Success Story

Retail Customer Segmentation Analysis

The retail industry has changed dramatically over the past few years. This rapid pace of change has put immense pressure on retail companies to keep up with ever-changing customer expectations. Retail companies have also been forced to identify lucrative customer segments and devise value maximization strategies to boost profitability. This is where customer segmentation analysis comes into play. Customer segmentation analysis helps retail companies to gather comprehensive insights to deepen customer loyalty and pinpoint their marketing strategies.

Customer segmentation analysis can help you precisely define your customers’ needs and create better value for them. Request a FREE brochure to gain detailed insights into our services portfolio and to learn how our customer segmentation analysis will help you assess changes in customer behaviour and measure the effectiveness of a marketing campaign.

Business Challenge

The client is a retail company based out of North America. As the client was new to the US retail market, they were facing difficulties in understanding their customers’ buying preferences, likes and dislikes, and shopping patterns. However, before investing huge capital into the business, the client wanted to gather deeper insights around their target customers to tailor personalized strategies. They also wanted to customize their marketing activities based on their customer behaviour. To do so, the client approached the experts at Infiniti Research to leverage their expertise in customer segmentation analysis.

By leveraging Infiniti’s customer segmentation analysis, the client wanted to:

Improve product and service offerings – By leveraging Infiniti’s customer segmentation analysis, the client wanted to gather relevant data on their customers’ needs to differentiate their product and service offerings. By doing so, the client wanted to enhance customer experience and outpace their competitors.

Enhance revenue – The client realized that putting efforts into the wrong segment can prove to be costly for the company. This can even increase the churn rate and lower upsell potential. The client, therefore, wanted to identify the profitable customer segments and promote their products and services.

Increase sales – With Infiniti’s customer segmentation analysis, the client wanted to specifically target their profitable customers and establish a perfect strategy to drive sales.

Focus on marketing activities – By efficiently segmenting customers into different sub-groups, the client wanted to create customized and focused marketing messages to capture customers’ attention.

Our Approach

To help the client segment the customer base, the experts at Infiniti Research performed customer segmentation analysis. Customer segmentation analysis approach involved segregation of the client’s customer groups into three categories namely – geographic, demographic, and psychographic segments. Also, the experts grouped customers into different segments using insights gathered from the research. The factors such as customer spend, frequency of purchases, channel usage, categories in which customers purchase, discount vs full price shoppers, and margin per customer was taken into consideration while grouping customers into various segments.

Results and Key Offerings

By segmenting customers into different sub-categories, the client was able to gain detailed insights into their customer segments. This helped them to differentiate their products according to customers’ needs. By leveraging Infiniti’s customer segmentation analysis, the client was also able to create targeted advertising and marketing campaigns for different subsets of customers. Furthermore, with customer segmentation analysis, the client increased sales conversion and reduced churn rate by 23%.

KEY FINDINGS AND OUTCOMESInfiniti’s customer segmentation analysis also helped the client to:

Increase competitiveness – By categorizing customers into various sub-categories based on their needs and requirements, the client was able to efficiently cater to their requirements and capture their attention by providing personalized offerings. This helped them to gain a leading edge in the market compared to their competitors.

Increase customer retention – Customer segmentation analysis helped the client to better serve their customer base. This helped the company to increase customer loyalty. Furthermore, this increased customer retention rate and reduced customer churn.

Optimize product price – By gathering detailed insights into the target customer segments, the client was able to efficiently price their products. By optimizing the product price, the client was able to ensure that customers get the most value for their dollars. Also, the client was able to enhance sales and revenues.

Customer segmentation analysis can help you precisely define your customers’ needs and create better value for them. Request a FREE brochure to gain detailed insights into our services portfolio and to learn how our customer segmentation analysis will help you assess changes in customer behaviour and measure the effectiveness of a marketing campaign.

What is customer segmentation analysis?

Customer segmentation analysis is defined as the process of categorizing a company’s customer into various sub-groups based on their characters and requirements. By grouping customers with similar characteristics, companies can easily devise value maximization strategies and create personalized marketing campaigns. Customer segmentation solutions have helped several companies to make strategic business decisions and thereby boost their revenue.

BENEFITS OF CUSTOMER SEGMENTATION ANALYSISWhy customer segmentation is the key to marketing?

In today’s customer-oriented world, the right customer segmentation can help businesses determine the most valuable customers and build marketing campaigns that suit them. In the long run, this will improve your brand loyalty and increase customer engagement. This success story from Infiniti Research describes how a leading transportation services provider was able to achieve these goals with our customer segmentation strategy.

Customer segmentation analysis can help you precisely define your customers’ needs and create better value for them. Request a FREE brochure to gain detailed insights into our services portfolio and to learn how our customer segmentation analysis will help you assess changes in customer behaviour and measure the effectiveness of a marketing campaign.

Market Assessment

A Leading Fashion Retail Brand Curtailed Losses and Increased Revenues by 20% – A Customer Segmentation Case Study

Business challenge

Over the last decade, the retail industry has undergone incredible disruption, largely impacting how customers shop and what they expect and demand from retailers. Fashion retail is one of the most dynamic segments in retail, wherein companies have to keep a constant watch on the changing trends. A failure to do so would result in a considerable decline in their market share. Although fashion retail is a highly united industry, the owners of fashion brands may find it difficult to thrive in the fiercely competitive industry due to its ambiguous nature. As the pace of change in the fashion retail industry accelerates, the need to have an innovative and sustainable customer segmentation models have become imperative.

Recently, a fashion retailer based out of Central Europe faced a decline in their overall sales rate. They also noted a substantial reduction in the number of frequent and repeat buyers. The company, therefore, approached Infiniti Research to undertake a detailed analysis to better understand the European fashion retail industry. The client wanted to leverage our customer segmentation solution to examine customer behavior, identify segments with a high potential for losses, and devise a mechanism to better understand the changing customer needs.

Building a customer segmentation strategy is no easy task, but within the retail sector, it is quickly becoming a necessity. Request a FREE brochure to know how our solutions can help you build an ideal customer segmentation strategy.

Solutions offered and value delivered

Infiniti’s customer segmentation analysis included a study based on a combination of factors such as customer needs, purchase patterns, attitudes, and behaviors. The customer segmentation solution offered to the client helped them uncover lucrative, under-served customer segments. Furthermore, gleaning insights into the potential customer segments helped the fashion retailer to determine the profit potential of each segment by analyzing its revenue and cost impact. The unique customer segmentation strategy also empowered the client to differentiate their brand from the global competition. This, in turn, helped them break through the cluttered market space with a unique and convincing proposition.

Targeted and focused strategies are the key to survival in today’s competitive world. Learn how we can help you devise an ideal go-to-market strategy. Request a free proposal.

In a span of eight weeks, the client was able to transform their operating model into a more segmented, customer-relationship based structure. This helped them to improve their wallet share and increased their overall revenue by 20%.  Moreover, with the help of Infiniti’s customer segmentation solution and recommendations, the client was able to increase their customer retention rate by 2X.

Importance of customer segmentation

customer segmentation

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Market segmentation

Market Segmentation: A Key to Success for Pharmaceutical Companies

The idea of dividing a market up into homogeneous segments and targeting each of them with a distinct product or message is now at the heart of marketing theory.

Rising costs and demands for affordable health care continue to challenge the traditional business assumptions and economics of the pharmaceutical industry. Also, this is raising internal development risks, costs, and time requirements for clinical trials. To add to the complexity, pharma markets have become fragmented as providers, patients, physicians, and payers look for focused solutions that have optimal safety and efficacy profits for a narrower population of patients. Additionally, the role of greater transparency, reference pricing, and changes in decision-making are essentially shifting decision-making authority away from individual physicians to healthcare administrators and payers. These dynamics result in the complexity of product decision-making and continue to challenge the effectiveness of traditional commercial models in the pharmaceutical industry. This is where the role of market segmentation comes into play. Market segmentation process enables pharmaceutical companies to move beyond product features and benefits or brand position to see specific needs through the eyes of specific market segments and this is an essential component of success for pharmaceutical companies.

Copy of Copy of banner IR (1)What is Market Segmentation?

Market segmentation is the process of segregating a market of potential customers into segments, or groups, based on various characteristics. The segments created consist of customers who will respond similarly to marketing strategies and who share traits such as similar needs, interests, or locations. The sole objective of the market segmentation process is to be able to design a marketing strategy, mix or program that matches, and is as impactful as possible, for each specific segment. It helps companies spend their marketing and advertising budgets much more wisely. Also, it enables companies to refine their product or service offerings for specific segments. Businesses are more likely to be able to meet the needs of a smaller, targeted segment, and therefore be much more successful.

What are the Different Types of Market Segmentation?

Demographic segmentation

Demographic segmentation is one of the widest and simplest types of market segmentation used. Most businesses use it to get the right set of people to use their products or services. Target market segmentation generally divides a population-based on variables. Demographic segmentation also has its own variables such as gender, age, income, family size, occupation, race, religion, and nationality. This type of market segmentation is most commonly used due to the fact that it has readily accessible information through existing customer relationships and can easily eliminate unnecessary data of the audience with just a few inclusions.

Behavioral segmentation

This is a type of target market segmentation that divides the population on the basis of their usage, behavior, and decision-making patterns. Behavioral segmentation divides your customers by their previous behavior in relation to your brand. It checks parameters including:

  • Previous purchases
  • Awareness of the business
  • Patterns of purchase
  • Usage level
  • Knowledge of the product
  • Rating of product or service

Psychographic segmentation

Psychographic segmentation is a type of market segmentation which uses activities of people, lifestyle, opinions, as well as interests to define a market segment. Psychographic segmentation is very similar to behavioral segmentation. But it also takes into account the psychological aspects of consumer buying behavior. These psychological aspects may be consumers social standing, his lifestyle as well as his activities, interests, and opinions.

Still, want to know more about market segmentation and how it can help companies build robust route-to-market strategies? We’d love to help! Contact us today.

Contact USWhat are the Benefits of Market Segmentation?

Benefit #1: Enhances the focus of the company

Target market segmentation is an effective method to enhance the focus of a firm on market segments. Better focus means better business. This helps in designing campaigns specifically for the target segments and aids in better returns and profitability.

Benefit #2: It boosts competitiveness

Naturally, if the focus increases, competitiveness in that market segment will also increase. This can also help in increasing market share and the chances of a new competitor entering might get low. Additionally, brand loyalty increases. Thus, market segmentation also boosts the competitiveness of a company from a holistic view.

Benefit #3: It helps in market expansion

Market segmentation can help in the immediate expansion of the market of any firm. If your market strategy is based on geography, then while catering to a particular territory, you can immediately expand to a nearby territory. Thus, the market share of business increases resulting in more revenue and profits.

Market Segmentation Strategies: Tick the Checklist

Measurable:

A good market segmentation strategy is one which is able to easily measure leads, sales figures, and engagement rates for any single market. If it’s not, then it probably overlaps too much with different segments and needs to be checked.

Clearly identifiable:

If any single segment overlaps too much with another, then probably it shouldn’t be a segment in its own right. A good market segmentation strategy requires every single segment to be substantially different and unique.

Accessible through promotional and communication channels:

If you are able to communicate with your target segments easily, then you can expect your market segmentation strategy to be effective. It does not matter whether this promotion or communication occurs via social media, advertising, telemarketing or e-marketing. As long as you can reach the consumers within it, you can expect to maximize your ROI.

Durable:

Market segmentation strategies can work effectively if market segments are not fluid but durable. How can you possibly expect to meet the demands, and communicate with, a segment that is consistently shifting and changing? It would be very difficult and would require infinite resources. Therefore, you need to ensure that your market segments are durable and stable in order to maximize your profits.

Responding differently:

For your target market segmentation process to yield maximum benefits you need to check if all of your market segments are responding in the same way to the marketing mix or differently. If the response is the same, then it is likely that they are actually not different segments.

For more information on our portfolio of market segmentation solutions, request for more information.Get More Info

How can Market Segmentation Help Pharmaceutical Companies?

In order to stay competitive in today’s transforming healthcare environment and engage better with physicians and patients, pharmaceutical companies need to shift from being product-focused to being customer-focused. They need to improve the effectiveness of communications and interactions with customers, including both physicians and patients, to meet objectives of marketing and help promote better health outcomes. Market segmentation can help them doing so in the following ways:

#1: Market segmentation in pharmaceutical marketing provides a better way to understand your target customers. This makes it easy for pharmaceutical companies to create marketing campaigns that really resonate with customers.

#2: Market segmentation provides detailed information on consumer personalities, emotions, values, interests, beliefs, and attitudes. This, in turn, can help pharmaceutical companies to identify their issues correctly and provide the required solutions.

#3: Market segmentation in pharmaceutical marketing is a very powerful tool as it looks more closely at the attitudes and motivations of consumers, providing pharmaceutical companies with important information on what customers want and why they want it.

#4: Psychographic type of market segmentation provides crucial information on the factors driving behavioral change among customers. Messaging based on customer attitudes and motivations are more likely to activate desired behaviors and strengthen the relationship between patient and brand.

#5: Target market segmentation helps pharmaceutical companies to analyze augmenting behavioral and demographic data with key insights on consumer personalities and motivations.

Market Entry Strategies

Customer Segmentation Strategy: 3 Key Challenges That Every Business Faces

A customer segmentation strategy is an invaluable tool for companies seeking to boost market share. However, most companies fail to implement an effective customer segmentation strategy. Modern companies know that they need to meet customer demands, but what they do not know is how to do this. Without precision, rich granularity, dynamism, and the context in the digital age, companies will be unable to meet the changing needs of their customers. Squeezed on one side by growing markets and on the other by merciless price-cutting, many companies are struggling to compete in today’s post-mass-market arena. The result can be undifferentiated offerings that yield no result and fail to please anyone. For businesses looking to improve the cash conversion cycle and bottom-line results, it is inevitable to do an effective customer segmentation analysis. In this article, we have discussed in detail about such challenges and many others that businesses face while devising their customer segmentation strategy and have suggested a few measures to deal with those challenges effectively.

Why IoT in Healthcare is the New Trend_ (4)Challenges in Customer Segmentation Strategy

Challenge #1: Understanding the scope of customer segmentation

For businesses, understanding the scope of segmentation is one of the most difficult challenges while formulating their customer segmentation strategy. If the scope is defined too broadly, it can lead to a very generic segmentation approach. On the other hand, segmentation of a very narrowly defined audience will result in very precise segments, but it would be of minimal relevance for other products or markets. This challenge requires businesses to think about several questions such as

  • What are the different degrees of scope at which currently segmentation is done?
  • How feasible are the variables of segmentation in customer segmentation analysis done for different business groups?
  • If standardizing segmentation across business groups is feasible or not?
  • What can be learnt from the competitors’ customer segmentation strategy?
  • What is their approach to customer segmentation analysis?

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Challenge #2: Comprehending inbound and outbound segmentation

Customer segmentation analysis reveals the fact that many businesses fail to understand the importance of inbound and outbound segmentation. They fail to decide how a customer segmentation strategy can be transitioned over the product life cycle so that there is a consistent view of segments and value propositions. This challenge requires companies to think about a few questions such as:

  • What are the uses of segmentation at the inbound stage?
  • What are the uses of segmentation at the outbound stage?
  • Can both the sets of variables be reconciled?
  • Can there be one “end-to-end” segmentation approach?

Challenge #3: Lack of Differentiation

A customer segmentation analysis asserts the fact that differentiation between the quality of products and their customers is very important for targeting the right customer for the right product. On a product level, without clarity in differentiation, businesses end up investing in products that are not aligned with profitability goals and current market trends. Differentiation facilitates businesses to make more strategic investments in products and customer service.

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Infiniti’s Solution

Infiniti Research, with its years of expertise in customer intelligence solution and customer segmentation analysis, is helping businesses to engage customers with confidence and gain unprecedented clarity on establishing individualized experiences in real-time. Infiniti helps businesses to measure the effectiveness of a marketing campaign in each of the customer segments, identify the most profitable segments of the customer, analyze changes in expectations of the customer, and also formulate value maximization strategies to improve their shares. Additionally, Infiniti helps companies to analyze their customers based on various variables at inbound and outbound stages like end-user behavior, usage scenarios, skill level, audience demography, price sensitivity, channel preference, and goals and outcomes.


Do you want to devise an effective customer segmentation strategy or want to gain more insights into our customer intelligence solutions? Contact us now!

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