Segmentation and Consumer Obsession

Segmentation is just the first step in consumer obsession. By properly segmenting people into groups with common characteristics, a company is better able to tailor its products or services and marketing efforts to meet the needs of that customer group.

I think that taking the stance that a company can meet the needs of every consumer is a death knell for that organization. Instead of focusing on doing the best for different segments by customizing offerings, the company is essentially not doing anything exceedingly well for anyone. This allows competitors to take market share and better serve customers with superior offerings.

I understand that the natural inclination is to market to the largest number of people in order capture as many customers as possible. But, if a company decides to focus on a smaller piece of the pie and serves that group really well, they might actually capture a larger volume of customers in the long run. The company will also be more likely to differentiate themselves from competitors. Customer loyalty and differentiation might also allow the company to charge higher prices for their products or services.

At work, I often come up against the segmentation question. With limited budget, help and resources we have to strategically choose which customer segments we pursue. Traditionally we have gone after mid-to-small size meeting planners, family travel and outdoor travel. We use further demographic factors to narrow down that scope further, (location, age, gender, etc). We also do some additional small niche marketing to groups like tour operators and sports event planners. Neither market costs an extreme amount to fully saturate from an advertising perspective.

It has been suggested numerous times by people in the community that we need to communicate that we have something for everyone in Colorado Springs. While this is true to some degree (we even have gambling within 45 minutes of downtown), this non-segmentation strategy would really hurt our tourism numbers. By saying we have something for everyone we are really saying we don't have a strong voice or anything that makes us unique. We wouldn't be playing to our strengths. While we do have gambling, we could never beat Las Vegas at that game. Without a strong, defined voice, other destinations would be able to easily capture some of our travelers with a stronger message that really resonates with the spirit of their destination.