Customer Analysis: Strategic Market Segmentation

CUSTOMER ANALYSIS
STRATEGIC MARKET
SEGMENTATION
WHY MUST WE ANALYZE OUR
CUSTOMERS?
Continue….
 So that we can understand their behavior.

 We can identify their needs and wants.
 We can identify their purchasing motives and what
their value most in their purchase.
 We can scan and indentify their unmet needs and
wants.
 From all of the above we can identify and execute
market driven strategy which lead to customer
satisfaction which later on lead to our firm’s
performance.
Continue...(The Framework)
Our offering/
Market driven
strategy
Firm’s
performance
Customer
Behavior, Customer
Needs satisfaction
&
Wants
CUSTOMER SATISFACTION MODEL/FRAMEWORK
Customer Repeat
Expectation: Purchase
Quality
Performance
Zero Defect
Durability = Our = Customer
Warranty Offering Satisfaction
Value
Taste
Cleanliness
Good Service Tell
Friendly Others
Etc.
Continue….
 Thus, we have to perform customer analysis

in order to be able to match our offerings or
strategies or our capabilities with the
customer requirements/value/needs and
wants.
HOW DO WE PERFORM CUSTOMER
ANALYSIS?
 Craven & Piercy (2009) suggest 6 steps

approach.
Continue…
Segment
The market
Value
opportunity
New market space
Matching value
Opportunities and
capabilities
Market targeting
Strategic
Positioning
strategy
Continue…
 Aaker (2003) suggests three (3) steps to do

customer analysis:
1) Do market segmentation.
2) Find the motivation (factors that affect the
segment’s purchase).
3) Analyze the unmet needs.
SEGMENTING THE MARKET
 Segmenting the market is where we break up

larger market or customers to smaller groups
which share same characteristics.
 This smaller group is known as market
segment.
WHY MUST WE SEGMENT THE
MARKET?
 Easy to understand each segment, because

each segment will behave in the same
manner and respond differently to different
strategies.
 For example kids needs toys and more
attracted to bright colors. Meantime older
people prefer peaceful environments and buy
vitamins and supplements to maintain their
health.
HOW DO WE SEGMENT THE
MARKET?
SEGMENTASI PASARAN
Asas segmentasi bagi pengguna individu:
Umur
Pendapatan
Tahap pendidikan
Jantina
Status perkahwinan
Faedah yang dicari
(economic, taste, performance, dll)
Occasions
(Business, leisure)
Kadar penggunaan
SEGMENTASI PASARAN
Asas segmentasi bagi pengguna organisasi:
Jenis perniagaan
Saiz syarikat
Lokasi
(geografi)
Size of order
(major or small)
Kriteria pembelian
(quality, service, price)
WHAT TOOLS CAN WE USED TO
PERFORM MARKET SEGMENTAION?
 We can use our own experience to segment

our current customers.
 We also can use computer database
program to data mining our current
customers.
 For potential customers we can look at
published data/information such as industrial
report.
CUSTOMER MOTIVATION OR
VALUE OPPORTUNITY
 After we segment our market then we can actually

identify many opportunities such as:
- Shopping motives or benefits of purchase.
- Types of product that they buy.
- Their purchase behavior or decision.
- Who influence them in the purchase.
- What are unmet needs that are still not fulfilled.
- Etc.
MARKET TARGETING
 When we break up the market into segments

we know that we have several segments to
serve.
 Once we evaluate the value opportunities
and our capabilities we should be able to
decide how many segments we can serve.
Continue…
 The process of choosing how many

segments to serve is known as market
targeting.
 There are criteria that we can use to choose
the segments.
CRITERIA FOR CHOOSING MARKET
SEGMENTS.
 Cost/Benefits (Financially attractive).

 Actions can be taken to satisfy the segments
(accessible).
 Each segment quite different from each other
and it response differently to different
marketing programs/strategy.
 Stability over time.
THE UNMET NEEDS
 An unmet needs is where the customer need

that is not being met by the existing product
offerings (Aaker, 2003).
 In short, there is no product in the market yet
that can satisfy the customer need or the
existing products still cannot satisfy the need
of the customers.
Continue….
 Unmet needs are strategically important

because they represent opportunities to the
firms to increase market share, break into
market, or create a new market.
 Firms also can get a pioneer advantages
such as establish brand awareness and
brand loyalty, can control supplies or
distribution and can get strategic location.
Continue….
 How do we identify the unmet needs???

- We can get it from our customers by
conducting customer survey or by
observing them using the products.
- We can conduct market research by
using individual or group interviews.
- We can ask questions such as:
Continue….
- what problems that they encounter when

using the products ?
- What is frustrating about it?
- How does it compare with other product
experience?
- How can the product be improved?
- etc….
SUMMARY OF THE CHAPTER
 Ability to identify customers’ needs and

wants and matching it with our offerings is
the main focus of customer analysis.
 Usually customer analysis start with market
segmentation, value opportunity, target
marketing and executing strategies.
END OF CHAPTER

Customer Analysis: Strategic Market Segmentation

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What are the steps involved in customer analysis?

What are the steps involved in customer analysis?

Why is it important to segment the market?

Why is it important to segment the market?

CUSTOMER ANALYSIS

 So that we can understand their behavior.

 Thus, we have to perform customer analysis

 Craven & Piercy (2009) suggest 6 steps

New market space

 Aaker (2003) suggests three (3) steps to do

 Segmenting the market is where we break up

 Easy to understand each segment, because

 We can use our own experience to segment

 After we segment our market then we can actually

 When we break up the market into segments

 The process of choosing how many

 Cost/Benefits (Financially attractive).

 An unmet needs is where the customer need

 Unmet needs are strategically important

 How do we identify the unmet needs???

- what problems that they encounter when

 Ability to identify customers’ needs and

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