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Advanced Segmentation Strategies in Internet Marketing

Explore the world of segmentation in internet marketing, from traditional bases to personalization strategies. Understand the importance of segmenting markets, using various methods to target diverse consumer groups effectively.

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Advanced Segmentation Strategies in Internet Marketing

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  1. SEGMENTATION INTERNET MARKETING 15.823 PROF. GLEN L. URBAN SPRING 2001

  2. OUTLINE • REVIEW OF SEGMENTATION • BASES • METHODS • LEVELS OF SEGMENTATION • GLOBAL • LOCAL • ONE TO ONE --PERSONALIZATION • CONSUMER RELATIONSHIP MANAGEMENT

  3. WHY SEGMENT MARKETS

  4. WHY SEGMENT • Preference Heterogeneity • Balance Versus Costs • Variety versus Production • INTERNET -- Some Costs Down • communicate individually • Interface customization • Some Costs not Changed • Physical Production/Inventory • Software -- Service Design

  5. DECISION • Segment or Not? Low Cost or Custom • Basis of Segmentation -- Many Choices • Level of Segmentation -- Big Enough • Common versus Segment Attributes -- Product/Service or Communication

  6. On Line Trading • eTrade? • MLPFS • Bridge Trader

  7. TRADITIONAL BASES OF SEGMENTATION • Demographics • Attitudes -- Psychographics • Preferences • products - like similar things • attribute importances -- benefit segmentation • Uses -- Intensity (Heavy/Light)

  8. TOP FRONTVIEW LEFT SIDE RIGHT SIDE

  9. EXAMPLES • PRIZM • VALS

  10. PRIZM USA census 1000 measures -- 34 factors -- 5 domains education and affluence family life cycle mobility ethnicity housing stock & urban cluster ZIP areas 12 and 40 cluster link to other zip data consumption

  11. PRIZMTHE 1980 ZIP CLUSTER MODELTWELVE ZIP-CLUSTER GROUPS, IN DESCENDING ZQ RANK Group CodesGroup Titles S1 Educated, Affluent Executives & Professionals in Elite Metro Suburbs S2 Pre & Post-Child Families & Singles In Upscale, White-Collar Suburbs S3 Upper-Middle, Child-Raising Families In Outlying, Owner-Occupied Suburbs U1 Educated, White-Collar Singles & Ethnics in Upscale, Urban Areas T1 Educated, Young, Mobile Families In Exurban Satellites & Boom Towns S4 Middle-Class, Post-Child Families In Aging Suburbs & Retirement Areas T2 Mid-Class, Child-Raising, Blue-Collar Families In Remote Suburbs & Towns U2 Mid-Class Immigrants & Minorities In Dense, Urban Row & Hi-Rise Areas R1 Rural Towns & Villages Amidst Farms & Ranches Across Agrarian Mid-America T3 Mixed Gentry & Blue-Collar Labor In Lo-Mid Rustic, Mill & Factory Towns R2 Mixed Whites, Blacks, Spanish & Indians In Poor Rural Towns & Farms U3 Mixed Blacks, Spanish & Immigrants In Aging, Urban Row & Hi-Rise Areas

  12. 43 LIFE STYLE QUESTIONS • My idea of fun at a national park would be to stay at an expensive lodge and dress up for dinner • I could stand to skin a dead animal • 1 to 7 agree --disagree scales • cluster • describe average person in cluster

  13. VALS2 GROUPS • Actualizers • Fulfilleds • Believers • Achievers • Strivers • Experiencers • Makers • Strugglers

  14. Levels of segmentation • Global • Country • Local • Individual

  15. EXAMPLES • Surgua -- SE Bank • Wine.com -- California Wines • Lycos/Terra Case • Yahoo.Boston -- Local Audience • Personalization

  16. LOCAL AUDIENCE • Like Minded Individuals • Affinity • Targeted commerce • Segments • local residents • college student • new comers • Tourists • Business Travelers • Displaced/relocated natives

  17. Personalization • Screen Layout • Targeted Marketing • Permissive Marketing • ads • brochures/info • Recommendations • Advisors • Intelligent Agents • Mass Customization

  18. CUSTOMER RELATIONSHIP MANAGEMENT • Organize Data • Profiling -- algorithms • Rules Engine • Delivery -- Communication/promotion • Measurement • Learning

  19. TAKEAWAY • Segmentation Art • Basis • Level • Segmentation Science • Profiling • Rules Engines • CRM -- Case Prime Response

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