Customer Segmentation at the sharp end

Customer segmentation can be immensely complex and involved.  It can, and should be, used to make sure customers receive great communications individually tailored (amongst many other things).

But …

… it can also be resolutely simple and yet still remain at the heart of brand communication.

I saw the opportunities and challenges this can bring first hand yesterday evening.

I do a ‘big shop’ once a month or so, I bet we all do something similar – It’s for the staples that last a while, washing powder, breakfast cereals (well in my case, Weetabix – the King of breakfast cereals!), household cleaners and toilet rolls etc. I did one on Friday evening.

I had selected my toilet rolls of choice and heard an argument alongside me.  It was quite animated and was all about segmentation.  At the end of the discussion the male party was abandoned by his female partner and was left looking a bit crestfallen.

Andrex have a very simple segmentation led marketing push at the moment;

“Are you a folder or a scruncher?”

Now to be fair my blog could descend into choppy waters here, but suffice to say the male was a ‘scruncher’ and the female a ‘folder’.  The argument appeared to be about whether the scrunching used more or less paper than the folding … but frankly that is beside the point.

How pleased would Andrex be to have heard this?  It demonstrates spot on segmentation and brand engagement all in one fell swoop.  So, inevitably, this morning, and with no small measure of nervousness, I logged onto their website and had a look.

I found some relatively engaging, but very well-integrated, marketing.  I do like the way the website makes the segmentation ‘light of touch’ and uses social media to evolve the ‘debate’.  That said, it’s not for everyone, and the TV ad is very poor in my view – and I have not actually seen it on TV. It runs a real risk of being seen as either funny or gross.  I think Andrex get the balance right on the packaging and website, but not on the ad.

Andrex web site screen shot

Andrex web site screen shot

Andrex web site

Ok, I accept it is a marketing campaign and not segmentation in a pure sense – but it seems to have a level of customer engagement and it’s a great leverage of what must have been a known internal customer insight.

I carried on my shopping, quietly amused, until I stumbled across the supermarket’s ready meal ranges.  Here I heard an altogether different reaction to the segmentation of meals – lets call them value, standard and posh for want of anything better.

The couple here were arguing about horse DNA and how the retailer had segmented them by use of these three price led options.

Now I know its topical, but herein lies a very real danger for retailers and brands I suspect.

The argument was, in my view, driven by a shifted perspective of the value range.  The vocalised assumption being that it is so cheap it must be, I quote, “ rubbish and full of horse and we are being exploited” – this is a cleaned up quote I hasten to add.

Then the conversation moved onto the risk I think has always been there with the ‘value’ lines, I quote again; “ If someone sees that in the trolley, they will think we are ok about eating horse because we can’t afford anything else”.

The trust in the value range has clearly gone for this couple.  They continued and I watched what they did next.  They bought the normal range, but put back an item, but they did compare prices across all three ranges.  I was left wondering if this was solely price driven.  The meal they did buy was chicken incidentally – bad news for chickens but good news for cows I guess!

I think there is a clearly heightened risk for retailers in the current value led segmentation of products, it will be interesting to see how this plays out as the testing results come in.  Although I think whatever they say, the market has shifted already.

So, an interesting 30 minutes in the supermarket that showed me how very simple segmentation can be engaging and fun and stimulate debate, but also how a similarly simple segmentation, again designed to meet valid insight, needs to change as customers perspectives and desires change.

Customers will, as ever, vote with their feet and pounds.  Personally I hope it provides a boost the High Street Butchers – there is a great one in the market town I live in, mind you he has lost his sense of humor over horse related jokes I noticed last weekend !  Maybe he should expand his range and sell loo rolls too!


PS – as an aside I did check the Food standards Agency website and was pleased to see that;

  • In 99% of cases tested (some 3,599) by 22 February no horse DNA was found at or above the level of 1%.  35 results representing 13 products contained Horse DNA at or above the 1% threshold.
  • No tests to date on samples containing horse DNA have found the veterinary medicine ‘Bute’ that everyone was worried about initially

Food Standards Agency Website : test results update

23 February ’13

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