Needs Based Customer Segmentation

Needs Based Customer Segmentation

​People are different. It’s a fact that helps marketers to segment their customers into groups which allows them to provide products, services and messages that are appropriate for them.

Most of the time a marketer will segment their customers or prospects on the basis of socio-economics, location, age, gender and if they know them already, behaviours.

If you stop and think about it though this doesn’t really match the definition of marketing which is all about servicing individuals (and those in companies if you are a B2B marketer) with product and service to satisfy needs at the same time as making a profit. And therein lies the missing word in the current focus of segmentation; needs.

Needs are that elusive thing that the prospect or customer often doesn’t realise they have and that the marketer is on a relentless pursuit to find. The need is often a more accurate definition of the requirement for a product or service than an assumption that a pre-defined group of people will share a common need which they wish to satisfy. As an example think of the way that Google provides Adwords. You don’t specify a target audience (as you can with Facebook advertising) but rather a set of Keywords which filter in those who are searching by way of the same need for service or information.

If we begin to focus our segmentation on the basis of collective needs rather than on how an individual looks and sounds, and where they are located, then perhaps we are starting to truly get to the heart of more accurate customer segmentation leading to a clear alignment of ourselves with our most valuable customers.