Market Segmentation: How to Do It and How to Profit from It, Revised and updated 4th Edition

Chapter 7

Accounting for the behaviour of decision-makers

Summary

To really understand what lies behind the choices made by customers requires their behaviour to be understood in terms of the needs they are seeking to satisfy. This is the most useful and practical way of explaining customer behaviour as it provides the insights required for putting together the most appropriate offer for each of the concluding segments, thereby realizing the most valuable benefits of segmentation. It is the needs of decision-makers that are identified by this, the fourth step in the segmentation process, as illustrated in Figure 7.1.

Figure 7.1 The segmentation process – Step 4

This chapter uses the details put together in the previous step to determine the needs-based buying requirements of the decision-makers who now form the sample for your project and takes account of the role of ‘price’ in their decision-making. As these are the criteria on which the concluding segments for your market will be based, this step, when completed, provides the framework for comparing the different decision-makers with one another.

When conducting a segmentation project using internal resources, information for this step potentially can be found among the same individuals involved in the previous step, supplemented, where possible, by lost sales reports and appropriate past market surveys. It is important to ...