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SegMENtational Analysis

August 13, 2010

Cristin Malone, looking to help a friend, this week discovered how market research can help find Mr. Right.

So the other night I was on the phone with a good friend of mine and of course the discussion topic was about men. Well, more specifically, it was about all her failed relationships with men. In agony, I listened for two hours as she re-visited every single relationship she had. She started from the very beginning of her romantic history and continued until she finished talking about the current guy she is dating (who is a very attractive, rude, and not very good for her, “bad” guy). For two hours I waited, itching to share my wisdom on love, patience, and being optimistic and just when the conversation was turning to my favor, she had to go. Why? Because her current “bad” guy was calling her on the other line; figures as such. Before switching over to the other line she asked me, “how come I always get stuck in bad relationships?”

As torturous as the conversation was, I felt terrible for my friend and wanted to help her. So for a few days, I pondered and thought deeply about her dilemma. Then the market researcher in me shined through. Eureka! The solution is segmentation analysis. Immediately, I called my friend and told her my bright idea, listed as follows:

 
Even though we considered our sample fairly representative in size, it is important to note how biased our data was. Well for one thing she was providing the information on these men, and even though I asked her to be as unbiased as possible, the information was still coming from her.

So after all our hard work and two large wine bottles later, we determined that the men she dated fell into four segments (which I think may be true for most women):

 
Now with our segments complete, we turned to creating the best questions my friend could ask on her next date to identify the type of guy she was meeting. With a few more looks over the data, we came up with these five questions:

 
In the chart above you will realize we did not mention the “ummmmmm what was his name again” guy. It’s not because we forgot about him, but mostly because we figured if she is on a date and isn’t even interested in asking these questions or if she is more interested in watching the ice cubes melt in her glass of water, that mostly likely he is an “ummmmmm what was his name again” guy.

Even in its simpler form, segmentation analysis is an amazing tool! In this case it was used to weed out the guys my friend was not interested in and to identify the type of guy she wanted: a good guy. However, in most cases, we as market researchers use this tool not to get rid of the bad relationships our clients have with their customers, but to help them improve or build stronger, quality relationships with their customers. Through segmentation analysis, we as market researchers can provide deep insights to our clients on the type of customers they have and who their customers are, including each customer segment’s behavior, needs, demands, and expectations. As a result of segmentation analysis, we help clients develop effective ways to communicate to their specific customer segments as well as better ways to serve their customer base. Helping our client better serve their customers leads to higher satisfaction and loyalty towards our client from their customer base.

While segmentation analysis works wonders for our clients, I have yet to determine whether my experimental, segmentation analysis has worked for my friend. We have completed steps 1-9, but still have to test our survey. Luckily, my friend has a date coming up this weekend. Stay tuned for my Next Thursday Night Insight for the results!

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