There are primarily three types of segmentation that are used in market research: Attitudinal, Behavioral, and Demographic. Which one you should use should be based on the objectives of your research. Let’s unpack each type of customer segmentation:
Demographic Segmentation
Demographic segmentation has been used as long as there has been research to define and profile groups based on various demographic traits, be it gender, age, race, region, or any other unique identifying factor. Nearly all research, with enough sample, can include demographic or firmographic segmentation. Such examples might include breaking out plumbers by residential or commercial work, looking at the insulation home builders prefer by region, or trying to find product preferences of Do-it-yourself versus Do-it-for-me homeowners.
Here is a simple example of segmenting plumbers by their primary type of work.
Behavioral Segmentation
Behavioral segmentation method groups people into how they interact with your business, website or product. Behavioral segmentation may answer questions such as How many other stores did they consider before shopping yours? Or What tools (coupons, websites, store visits) were used most often to determine which product to purchase?
Behavioral segmentation can help to find the most engaged customers and allow for better targeting and better use of marketing resources. You can focus on the customers most likely to purchase your product or shop your store.
In the hardware and home improvement industry this type of research often focuses on purchase and usage behavior such as what resources are being used to research a product, what types of information are they looking for when researching, and what are the primary questions being asked about the product.
When you group your data based on the information customers seek, you can refine those factors influencing their purchases, uncovering the product features or service aspects they most often use and are influenced by.
Often times when doing behavioral segmentation, we can figure out what customers want and why, but oftentimes doesn’t dig into why other products/features/methods don’t work for them and how those can be improved. In many cases qualitative research in conjunction with quant can help to better answer those questions.
Attitudinal Segmentation
Where behavioral segmentation can sometimes be limited to understanding what a respondent says or does, attitudinal segmentation can add more understanding on the why of their decision making. Attitudinal segmentation is based more on beliefs and opinions and less about behaviors. This methodology and the results it provides can help better market a product for an increased likelihood of purchase.
Attitudinal segmentation is often based on asking very targeted questions, often ‘agree/disagree’ statements. Using cluster analysis you can find respondents with similar attitudes and opinions about a certain product, shopping method, or just general feelings. Once the clusters, or groups, are determined then further analysis can be done to understand the demographics or other traits of the group. For example, you may find that a group of homeowners who prefer a certain color of a product are more likely to be of a certain age, gender or region.
So, which type should you use? As with most analytical techniques, it depends on what problem you are trying to solve. Demographic segmentation is a powerful tool to better understand who your target audience is and optimize marketing efforts and strategies. Behavioral segmentation can help to find the most engaged customers and allow for better targeting and better use of marketing resources. You can focus on the customers most likely to purchase your product or shop your store. Attitudinal segmentation provides beyond surface-level demographics to understand the psychological drivers of consumer behavior and can help craft more focused, compelling marketing campaigns.
Whatever your needs, our experienced market research team at The Farnsworth Group can provide you with the right tools to conduct effective segmentation research and collect valuable insights to help you successfully forecast the market and strategize your go to market tactics accordingly.
Written by Grant Gries
Grant G. is the glue that holds our research team together. He joined the firm in 2002 and serves as the VP of Operations. Prior to joining The Farnsworth Group, Grant G. was a Retail Associate at Lowe’s, specifically in the plumbing and HVAC departments and is now glad to work more directly with hundreds of manufacturers and retailers in the home improvement space to improve the products that are stocked on shelves. Grant G. brings with him decades of experience in proper survey design, methodologies for recruiting real Pros and DIYers successfully, and deployment of rigorous analytical tools to provide solid answers to our client’s toughest questions. Based in Indianapolis, Grant G. is husband to Sarah and father of two girls who (thankfully!) all love sports. For better or worse, Grant is a Purdue Boilermaker and follow their basketball and football teams. Boiler up!