Customer Segmentation to Learn What Works Well for Whom
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1 Customer Segmentation to Learn What Works Well for Whom Paul Bakker Social Impact Squared Steve Ayer Common Good Strategies Beverly Powell-Vinden Heart & Stroke Foundation CES Conference
2 Agenda Share what I have learned from marketers Show the benefits of segmentation in practice 2
3 WHY LEARN FROM MARKETERS 3
4 Marketing Shares Many Similarities to Evaluation Marketers are program designers and evaluators As with marketing, social programs can vary both the messages they deliver and the medium of delivery. For most social programs to be successful clients need to buy into the program and it s theory of change. 4
5 History of Segmentation in Marketing One of the essential principals in modern marketing If you re not thinking segments, you re not thinking marketing - Theodore Levitt, the Marketing Imagination (1983) 5
6 MARKET SEGMENTATION: QUICK REVIEW 3
7 What is market segmentation Marketing is generally based off the idea of segmenting the market, targeting a subgroup in the market, and positioning your offering in a way that will change the behaviour of that subgroup 7
8 Basic Market Segmentation Strategies Geographic Demographic Product Usage Life cycle Stage of decision making 8
9 Segmentation Steps 1. Often start with informal theory. 2. Informal theory should help inform the demographics that are recorded 3. Formal segmentation using data mining to associate demographics with observed purchasing behaviour and customer value. Marketers often use randomization to figure out which segments respond better to option A or B. 4. More sophisticated methods include merging survey and customer data and creating segments based on factor analysis, cluster analysis, tree maps, etc. 9
10 Example of Market Segmentation Use Market Segment C. Non-target market (about 70%) B. Moderate prospects (about 22%) A. Strong prospects (about 8%) Marketing Tactic Used No specific outbound marketing activity s and direct mail Promoted webinars and group product tours Personal phone calls Promoted individual one-on-one product tours
11 Market Segments Should Be Internally consistent Substantially different from other segments Predict behaviour in some way Measureable Reachable Cost effective Useful 11
12 EXAMPLE OF SEGMENTATION IN EVALUATION Heart and Stroke Foundation s review of the Mission Content Team s role and future direction 12
13 Project Background The Mission Content Team is a team of science specialists that facilitate knowledge transfer and exchange between and among Heart and Stroke Foundation stakeholders Overall Project Purpose: Determine potential for formal knowledge broker role at HSF and whether this role could be filled by MCT. Components: literature review environmental scan stakeholder interviews needs assessment survey (segmentation of results) 13
14 Segments Used We broke results down by office location and job title, as those variables drove unique information need and use patterns. Segments: Marketing & Communications (all are in the Provincial Office) Provincial Office Fundraisers Provincial Office Research, Advocacy, and Health Promotion staff Regional/Local Office Fundraisers Regional/Local Office Research, Advocacy, and Health Promotion staff 14
15 Overall Results Sources of Mission / Science Information N=85 15
16 Segmented Results Using MCT for Mission / Science Information 100.0% 90.0% 80.0% 70.0% 60.0% 50.0% 40.0% 30.0% 20.0% 10.0%.0% Mission Content Team Marketing & Communications (Provincial) (N=14) Fundraising (Provincial) (N=24) Research, Advocacy or Health Promotion (Provincial) (N=18) Fundraising (Regional/Local) (N=13) Research, Advocacy or Health Promotion (Regional/Local) (N=8) Question: In general, where do you search for mission - / science- information? 16
17 Segmented Results Using Internet Searches for Mission/Science Information 90.0% 80.0% 70.0% 60.0% 50.0% 40.0% 30.0% 20.0% 10.0%.0% Internet search engines Marketing & Communications (Provincial) (N=14) Fundraising (Provincial) (N=24) Research, Advocacy or Health Promotion (Provincial) (N=18) Fundraising (Regional/Local) (N=13) Research, Advocacy or Health Promotion (Regional/Local) (N=8) Question: In general, where do you search for mission - / science- information? 17
18 Average Rank Overall Results Awareness of Services Extremely aware Moderately aware Somewhat aware Slightly aware Not at all aware In-person consultations Requests via Researcher Speaker program Mission Round program Mission Soundbite Factsheets N=77 18
19 Average Rank Segmented Results Awareness of Services Extremely aware Moderately aware Somewhat aware Slightly aware Not at all aware In-person consultations Marketing & Communications (Provincial) (N=13) Fundraising (Provincial) (N=23) Research, Advocacy or Health Promotion (Provincial) (N=17) Fundraising (Regional/Local) (N=12) Research, Advocacy or Health Promotion (Regional/Local) (N=8) Question: The Mission Content Team provides a variety of services and resources. Please rate your level of AWARENESS of each of the following: 19
20 Overall Results Using Segmentation Highlighted to customize approach to working with the different segments. Plans to customize: type of information mode of delivery format of information Will host focus group with regional fundraisers to: increase awareness Learn how to better assist them 20
21 Main Take-Aways Only looking at overall results and offering one-size fits all solutions reduces effectiveness. Evaluators looking to explain what works well for whom, can learn from marketing s practice of customer segmentation. Ask direct questions to test the program options that are on the table. 21
22 Thank You! Paul Bakker Steve Ayer Beverly Powell-Vinden Questions? 22
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