What is Audience Segmentation?

People aren’t all the same. That’s pretty obvious, right? Frank might like Man City, Hannah prefers Man United. Lorena might like fish, Laura’s more of a chicken lady. Eric loves staying in reading on a Friday night, Ada paints the town red. If you were to talk to Frank, you wouldn’t ask him about Paul Pogba’s latest screamer, no more than you’d see if Lorena wanted a trip to Nando’s. If you did, you probably wouldn’t get a very positive response. So why do we do it in marketing?

All too often, marketers don’t take the subtle, granular differences within their audience into account when developing their digital strategy. Obviously, we can’t drill down to specific people, otherwise we’d have to spend our time meeting every single one of them in person and having a chat with them over a nice cuppa – if they like tea, of course. But that doesn’t mean audience and customer segmentation can’t be done and done well.

What is Audience Segmentation?

Put simply, audience segmentation is the act of splitting up an often vast audience into smaller, manageable chunks depending on their personality and preferences. For example, if you’re a car company, you might segment people depending on their age so you can give certain deals to new drivers. If you’re a smartphone retailer, you might segment people depending on their previous purchases, so you can tailor deals based on what they’ve shown an interest in in the past. This is also known as behavioural segmentation.

By segmenting the audience like this, a brand can get a clearer understanding of who it needs to target and how. This is particularly important in complex, very popular, or emerging sectors such as esports. As Andrew Nixon of media law firm Sheridans told us: “Key is understanding the industry and what the brand wants to achieve; and therefore how can involvement deliver those objectives. For example, a ‘logo plant’ doesn’t work in esports; a brand needs to buy into the community and prove it is committed to the community.

What kinds of Audience Segmentation are there?

Brands can segment their audience in a number of different ways, some of which are listed below.

Demographic Segmentation

This covers a wide range of demographic information, such as (but not limited to) gender, age, education level and income. It’s perhaps the most popular way to segment an audience due to the scope involved.

Location Segmentation

Geography plays a huge part in consumer buying habits so it’s important to take that into account. Through Location Segmentation, brands can identify where customers live and how that might influence their buying behaviour.

Psychographic Segmentation

Though it sounds like something from a science fiction film, Psychographic Segmentation is simply breaking your audience down into groups depending on their personality, lifestyle or interests. This allows brands to get very granular and gain an appreciation of their audience’s true personality, not just what demographic data might suggest.

Behavioural Segmentation

Behavioural Segmentation takes into account the customer’s purchase history. For example, if someone’s bought a certain kind of phone in the past, it’s likely they’ll be looking for related accessories, or a similar phone if they’re looking for an upgrade or if theirs breaks down in future. A form of this kind of segmentation is called ‘Shopping Data Segmentation’.

Seasonal Segmentation

The weather plays a huge part in influencing our buying habits. By anticipating this and segmenting the audience based on seasonality, brands can better take advantage of people’s weather-based purchases.

How does Audience Segmentation work?

At this point, it’s worthwhile looking at examples of how audience segmentation works to make it absolutely clear how brands can get the best value. Below are two (fictitious) examples that use different kinds of audience segmentation and different kinds of brands.

**Bee – Make a beeline with us **

PROBLEM: Bee is a start-up communications app aimed at helping the elderly get in touch with their relatives. The app is quick and simple to use, offering a more stripped-back user experience than other chat apps on the market. Bee wants to understand how to tap into its audience with maximum efficiency.

SOLUTION: Bee explores Demographic Segmentation as it allows segmentation based on age. It looks at targeting those already above retirement age, but with an eye on the future, it focuses on those approaching retirement age as well.

Adding extra granularity, the company has conducted research that suggests elderly men find it more difficult to cope with new technology than elderly women, and so it breaks its age-based demographic up more by looking to elderly women first.

**Komorebi - Nature, Illuminated **

PROBLEM: Komorebi is dedicated to promoting natural beauty spots in the UK through online and offline marketing. However, it’s having to re-consider its marketing to maximise its recently cut budget. It therefore needs to know exactly who to target.

SOLUTION: Komorebi uses two forms of segmentation. Firstly, the company looks at Behavioural Segmentation in order to understand who its current customers are and which beauty spots they've been to before. This enables an understanding of which places are most popular.

Secondly, it uses Location Segmentation to identify people located around these beauty spots and other key beauty spots around the country. This allows them to target those most able to attend these places, whether they’ve visited them in the past or not.

Using Audience Segmentation in Emerging Sectors

The above examples are in established sectors, but what about in new ones? esports is the most significant emerging sector at the moment, and represents a significant chance for brands to get involved. As Caroline Miller of Indigo Pearl told us: “It’s an opportunity to get in front of consumers who are hard to market to. Most esports fans don’t consume traditional media, so traditional marketing doesn’t reach them.” But where do brands begin?

The first step is recognising that the cliché of video game players simply doesn’t exist anymore. “I think by far the most common misconception is that [gaming fans] are basement nerds without a life,” GQ gaming critic Sam White told us. “Nowadays, when gaming is by far the most popular form of entertainment on Earth, gamers come in all forms. I recently filmed a documentary for GQ at an event called Fanfest – a convention centered around the online space game, Eve - and I met NASA employees, lawyers, psychologists and incredibly smart and social maths students.

Breaking this wide audience down is critical for any brand looking to enter into the sector. There’s a need to go as granular as possible and understand a range of key factors, including: who the fans are, what titles and platforms they prefer and whether they’re players or fans. “There’s no one size fits all solution,” Andrew Nixon tells us. “The key is commitment to the community, long term. It’s not a ‘simple’ option – and it needs careful consideration and due diligence in terms of the game title you are aligning to and the reach the brand’s engagement will likely achieve.

Conclusion

Audience Segmentation is all about understanding the audience. By breaking the audience down in a granular and fluid fashion, brands can build a stronger relationship with their audience and ultimately drive revenue. In a complex sector like esports, that’s a critical task that should not be ignored.

Find out how you can learn about audience segmentation in esports by downloading our guide, Field of View: Understanding the esports Audience.

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