Apples & Oranges: Let’s Talk Segmentation

Some people like apples, some people like oranges. Some people like both. Some people don’t particularly like either, but they know they need their vitamins. Now, let’s say you own a fruit shop; are you going to focus only on marketing to apple lovers? Only sell oranges? Advertise how delicious your apples and oranges are to the haters?

Probably not, right? You’re going to try to find ways to target those apple addicts, then market your juicy oranges to the orange obsessed. And for the fruit afraid? Perhaps market those vitamin-rich candies that taste like…I don’t know…bubblegum?

What I’m alluding to here is the marketing concept known as market segmentation, which Kerin’s Marketing: The Core defines as:

aggregating prospective buyers into groups, or segments, that (1) have common needs and (2) will respond similarly to a marketing action.

Now, market segmentation can work a few different ways according to Kerin. We marketers can choose to market one product to multiple market segments, create multiple products to accommodate multiple market segments or offer individualized experiences with segments of one (mass customization).

Segmentation, especially the latter two types, gives brands the ability to create more choices for more people. But does more choice mean more profit for a company, or can it lend to customers feeling overwhelmed and confused?

The answer: It depends. Let’s explore why.

First off, successful marketing decisions aren’t made without extensive market research. So, going back to my silly apples and oranges example, if you automatically jumped on the idea of diversifying your product selection at your fruit shop to cater to a wider clientele base, you’re making a decision without the proper research behind it, and assuming that more products mean more customers and ultimately more profit. But is this always the case? Nope!

In reality, unless you can segment customer buying behaviors and needs into distinct geographic, demographic, psychographic, or/and behavioral segments, and can come up with unique needs based on these segments, market segmentation likely doesn’t make sense and can lead to wasting money on creating new products or unique marketing campaigns unnecessarily. There is certainly such thing as good and bad segmentation.

So while it’s important to consider segmentation in any marketing decision, sometimes it’s better to just keep it simple. After all, if it ain’t broke, don’t fix it!