Services

Segmentation & Targeting

The ability to create and sustain a meaningful competitive advantage requires a deep knowledge of customer needs and a disciplined sales and marketing process to ensure that needs are effectively addressed. Market segmentation is a strategic process for achieving alignment between product offerings and customer need.

Marketers rely on segmentation to…

  • Optimize allocation of sales and marketing resources by targeting high-value customers
  • Guide product development and customize service offerings to accommodate needs of target segments
  • Increase promotional impact by positioning products and customizing messages to align with segment-specific orientations

Even so, successfully bridging the gap between segmentation principles and successful application continues to be a major challenge for the marketing community. It's one we have the technical capabilities and experience to help clients meet.

NA Worldwide was an acknowledged pioneer in market segmentation over 40 years ago, and we continue to advance the art by ensuring that the tools are sharp and the precepts thoughtfully applied.  Our flexible, customized approach to market segmentation research enables us to design creative yet pragmatic segmentation frameworks for a wide array of market applications and industries.

We help clients make sound and realistic decisions about segmentation by…

  • Supporting them in problem definition
  • Helping them decide whether segmentation research is appropriate and what return on their research and marketing investment they can expect
  • Making sense of the various conceptual approaches and methodological options available
  • Helping clients operationalize and reach success criteria
  • Guiding detailed implementation to ensure that the organization embraces and uses a segmentation framework

We are able to guide our clients toward success based on…

  • Facility with diverse market segmentation approaches to support specific strategic decisions.
  • Depth of experience with all relevant market segmentation techniques, including our Hypredictive® segmentation service to enhance access to target segments.
  • Pragmatic implementation support to help marketing managers formulate segment-based marketing strategies and prioritize tactical initiatives.

In addition, we provide market segmentation training and consultation for industry associations and individual clients, developing customized materials for specific companies and teams. Segmentation Marketing by former Company Chairman, John Berrigan, remains a definitive text on business market segmentation.

Market Segmentation Approaches

Choosing the right segmentation approach requires both a clear understanding of business objectives and intimate familiarity with the methodological options. A firm grasp of the segmentation mechanics, extensive implementation experience, and specialized industry focus are requirements for anticipating and addressing the specific challenges of each market when designing segmentation approaches.

Over a period of four decades, NA Worldwide has developed hundreds of market-sensitive segmentation frameworks, including blended, tiered (or hierarchical), and multi-faceted segmentations, by adapting and enhancing a wide range of statistical techniques. These segmentation frameworks have been designed to segment consumers or businesses, individuals or households, products within a portfolio, or usage/purchase occasions using the following types of building blocks, often in combination.

  • Demographic and "firmographic" or institutional characteristics,
  • Behaviors
  • Needs and motivations
  • Attitudes and ethos
  • Usage or purchase occasion characteristics

Market complexity or client objectives frequently argue for multi-dimensional segmentation schemes that draw on some combination of basis variables to properly reflect or illuminate market structure.  Examples of approaches used regularly at NA Worldwide include:

Blended or Hybrid Segmentations
Using multi-criteria clustering tools, hybrid segmentations create a marketing framework based on a combination of customer attributes that often include demographics (or firmographics), behaviors and needs or attitudes.  Decisions on variables to include and weights to assign take account of marketing objectives, market structure, anticipated applications, and segmentation clarity or usability.  Our Hypredictive® service allows us to select segmentation strategies that meet client objectives for ease and accuracy of customer assignment. These techniques have special value in B-to-B and Pharmaceutical marketing, where customer targeting must be achieved primarily on basis of secondary data. Using Hypredictive®, we can balance attitudes vs. behavior with "joystick" flexibility to select segmentation schemes that meet explicit criteria for ease of implementation and marketing utility.

Tiered Segmentations
When blended segmentations appear likely to create a diffuse perspective that constrains practical implementation, NA Worldwide often develops "hierarchical" segmentation models that incorporate multiple dimensions but treat each one distinctly.  An "overarching" segmentation dimension is chosen based on the nature of the marketplace and the client's specific marketing objectives, and then each resulting segment is further "subsegmented" based on secondary or tertiary considerations.  The result is a holistic market framework that simultaneously provides a comprehensive marketing and organizational "worldview," while still offering sufficient granularity of insight to inform distinctions and decisions relevant to unique market parameters.

Multi-Faceted and Dynamic Segmentations
Another variation is multi-faceted segmentation used to segment the market simultaneously along multiple dimensions.  This produces a cohesive framework with multiple facets, each tuned to inform specific strategic, marketing or sales issues.  The multi-faceted model allows users to focus on the segmentation dimension (or facet) of greatest relevance to specific marketing issues they are addressing – and switch views as required.  The result is a unified segmentation scheme that simultaneously satisfies the needs of different users within an organization.

Successful segmentation outcomes require matching an approach to a set of strategic marketing objectives and a specific marketing environment.  We can help you select the right approach and apply it in market-sensitive, pragmatic ways.

Additional segmentation topics:

  • Market applications
  • Segmentation techniques
  • Implementation support

Market Applications

NA Worldwide designs successful market segmentation systems for a wide variety of markets, working closely with client teams to craft approaches suited to their specific business objectives and the nuances of their particular markets.

Consumer Market Segmentation
NA Worldwide has developed segmentations for a very broad spectrum of consumer applications based on purchase or usage occasions, purchase needs and motivations, demographic or behavioral variables and customer worldviews to ensure that products and services are designed for, and delivered to, the market segments that value them most. Our consumer market segmentations include assignments to guide DTC and DTP initiatives in the pharmaceutical industry where patient empowerment is changing the terms of dialogue between marketers, healthcare professionals and patients.

Deciding which segmentation principles are likely to offer greatest insight and successfully drive marketing strategy requires a continuously updated knowledge of category trends, as well as proficiency with the tools for understanding market dynamics and drivers of consumer choice.  Our Consumer Marketing teams are directed by recognized industry leaders, with decades of market-tested segmentation experience.

Business Market Segmentation
Effective segmentation of business markets is required to formulate winning strategies for different types of customers, and create an organized framework for strategy implementation.  A particular challenge posed in business market segmentation is the complex decision process that tends to drive selection of suppliers and products.  Many individuals may be often involved in the decision process, each with different orientations, needs, and motivations.  Creating segmentations that properly reflect and differentiate between business customers while simultaneously recognizing the heterogeneity of decision drivers that may exist within each organization requires an ability to identify complex decision processes and map the interrelationships that exist within customer organizations.

We have decades of experience working with leading business marketers in the IT, Energy, Industrial, Financial, and Business service arenas, to create powerful, actionable segmentations for B-to-B environments – with a track record of success that has earned us a reputation as "best-in-class" with clients throughout the world.

Healthcare Market Segmentation
The process of applying market segmentation strategies to the Pharmaceutical industry creates meaningful opportunities as well as special challenges.  The opportunities come from extraordinarily rich and reliable customer-level databases (i.e., Rx audits) that can increase the predictive power and marketing utility of a segmentation framework.  The challenges owe to the industry's high standards for "actionability" and field-level implementation.  Even with the trend toward sales force contraction, no industry rivals Pharmaceuticals for its level of individual customer attention.

Additional challenges can arise when we attempt to overlay various attitudinal segmentations on the framework of physician specialty.  Physician specialty is a dimension that has proven consistently more relevant than almost any other as a basis for shaping dialogue between pharmaceutical marketers and their customers.  In fact, physician specialty – and medical education per se – is a homogenizing process that can limit the practicality of certain types of segmentations.  Physicians are trained to think and behave more uniformly than many other types of customers.

It is all the more important, then, that practitioners of market segmentation in the healthcare arena set clear, concrete and realistic objectives for segmentation so that they can select appropriate tools and set reasonable standards for success.  An attitudinal or needs-based segmentation may be inspirational but may not meet an organization's standards for marketing actionability and return on research investment if it cannot be applied at the sales detail level.  Patient segmentations play by more traditional CPG rules but there, too, it is crucially important to set realistic expectations that take account of available promotional resources and the ability to cost-effectively reach relevant segments with appropriate messages that will activate them effectively.

NA Worldwide brings together a unique set of tools and perspectives that maximize the likelihood clients will extract full value from their segmentation initiatives – whether directed at patients, healthcare professionals, healthcare institutions, or any other type of healthcare decision-maker.

  • Depth of segmentation experience drawn from multiple industries to produce a truly rich inventory of "best practices"
  • Specialized healthcare experience unmatched for its historical perspective, clinical sophistication, and breadth
  • A staff of senior consultants who combine both skill sets so that methodological and marketing perspectives are fully integrated 
  • Leading edge techniques (like our Hypredictive® service) that optimize the contribution of attitudes and behaviors in order to balance marketing insight and targeting success
  • A commitment to helping clients set research agendas that take full account of what they need to accomplish, and an unshrinking candor in helping them to decide when and how segmentation will help them reach their goals

Segmentation Techniques

Segmentation is a time-tested approach for enhancing marketing success, allowing marketers to focus their attention and resources on the most compelling market opportunities. A wide range of techniques are employed to create useful market segmentation frameworks, highlighting segments that present unique opportunities based on distinctive behaviors, needs, demographics, or attitudes/mindset.

Segmentation approaches range can range from simple categorization analyses (including CART and CHAID analyses) to more sophisticated clustering techniques (K-means or Latent class).  Complex multi-tiered or multi-faceted segmentations may require application of a combination of these methodologies.  As a technical innovation leader in the segmentation arena, NA Worldwide has developed state-of-the-art segmentation methodologies that draw on, and enhance, each of these foundational techniques, providing the flexibility to create highly customized solutions for our clients.  What makes this customization possible is an in-house methods and analytics function directed by industry leaders who are able to innovate rather than simply apply off-the-shelf techniques.

Our Methods Department is supported by significant annual investments to create the intellectual capital on which leadership depends.  The team closely monitors and contributes to ongoing industry dialogue and debate on different segmentation techniques based on a concerted R&D effort that systematically compares outcomes using alternative approaches.  Ultimately, however, segmentation success is propelled more by mature and creative marketing application than statistical underpinnings.  We take pride in segmentations that see active and effective use because they are tailored to each client's objectives with a clear vision about the rationale for segmentation and the ROI it must deliver.

Hypredictive®

One of the novel segmentation services that we offer is Hypredictive®. It is an example of the sort of innovation that has helped to bridge the gap between theory and marketing application.  Applying multi-criteria clustering techniques, Hypredictive® enables us to adjust input weights with "joystick" flexibility in order to devise segmentation schemes that deliver marketing insight while also meeting stated requirements for classification accuracy and efficiency when assigning customers to the relevant segments.

All of our segmentation methodologies are suitable for a wide range of market applications and yield results that can be readily integrated into our suite of segmentation implementation support applications.

Implementation Support

Effective implementation begins with a workshop approach to delivering segmentation outcomes that help teams internalize segment profiles and develop a strategy for targeting while those insights are fresh.   NA Worldwide has developed a broad suite of customized interactive tools to help clients implement segmentation marketing programs.

Market Response Simulators
NA Worldwide offers a portfolio of user-friendly interactive simulators designed to predict purchase decisions and identify profit opportunities for both individual customer segments as well as aggregate market populations.  These powerful resources help clients prioritize investment decisions by providing accurate estimates of the sales implications of alternate pricing, promotion, and product/service configuration scenarios among target market segments.  Applications are designed to support either enterprise-wide assessments or forecasts within target geographical areas.

Sales Support Applications
NA-Sales support applications provide customized desktop or laptop software tools designed to help sales representatives improve sales revenue and cost-per-sale performance.  Using segmentation insights, customer information, and/or secondary data in conjunction with sophisticated models, these customized applications classify and prioritize prospects, and provide sales representatives with tailored offers and messages designed to resonate with their specific needs.  These applications can be easily integrated into all mainstream CRM contact management systems.

Customer and Prospect Targeting Systems
Our targeting systems harness the power of our proprietary NA-Link®, and NA-QuikLink® modeling suites to provide clients with real-time decision support that enables call centers, websites, direct marketers, and sales representatives to identify key market segments, and to tailor and target offers to maximize marketing ROI. Boasting superior targeting accuracy derived from our state-of-the-art Hypredictive® segmentation techniques, these systems can either be used in stand-alone applications or integrated into ongoing customer information warehouses through the application of database scoring algorithms that we develop. In addition to providing support for broad-based targeting initiatives, these systems and algorithms can be customized to support interactive marketing applications wherein a short battery of questions can be asked to determine an individual customer's (or prospect's) segment membership, identify the best product or service for them, and successfully "customize" and position your offer.

Segmentation Marketing: New Methods for Capturing Business Markets

Segmentation Marketing: New Methods for Capturing Business Markets, is a Fortune 50 authoritative text co-authored by John Berrigan and Carl Finkbeiner both formerly of NA Worldwide.  Still the definitive work on this topic, the book shows how companies can utilize segmentation principle to achieve success in B-to-B market environments despite decision-making complexity of large customer organization.  The authors offer solutions for identifying needs and provide a framework for developing and implementing strategic and tactical applications that have helped companies reconceive their marketing strategies by engaging with customers in new ways.

  • A definition of segmentation and discussion of its benefits.
  • A definition of "needs" and guidelines for operationalizing those concepts.
  • A framework for augmenting business markets.
  • Guidelines for conducting the market research necessary for identifying needs.
  • The strategic applications of needs-based segmentation.
  • A working description of tactical applications relating to the marketing mix.
  • The design and implementation of a market information system.
  • A framework and guidelines for implementing this approach.
  • A hypothetical case study showing how sustainable advantage is created by needs-based segmentation.

For more information on segmentation, click here.

For more information on NA Worldwide, please e-mail us or call (215) 496-6800.