The posts here represent the opinions of CMB employees and guests—not necessarily the company as a whole. 

Subscribe to Email Updates


see all

Like Any TV Show, Market Segmentation Studies Have Trade Offs

Posted by Jeff McKenna on Tue, Jul 27, 2010

If your last segmentation project was a TV show which one would it be? Would it be like Cheers- great when it was done and lived on successfully after that, or was it more like Lost- complex and often confusing but enjoyable, you’re just hoping it ends well. Maybe it was more like American Idol and picking the right scheme became more of a popularity contest than one based on merit. Let’s just hope it was not like Buffy the Vampire Slayer- just one nightmarish scene after another or like The Hills- lots of style but very little substance. market segmentation research

If you said any of these television shows, you are not alone.  In fact, if you said any show other than Cheers you would be in the majority; and it is a shame, because segmentation projects typically get a bad rap among business managers and leaders due in large part to these poor outcomes.  Often times researchers and managers point to poor analytical techniques or lack of industry knowledge as the root causes of the problem.  However, these are just part of an overarching challenge to achieve success. 

(You can also check out our best practices webinar where we identify six straight-forward rules to ensure your next segmentation project has everyone saying Cheers!)

As with anything in life there are trade-offs. A segmentation study is no different. Each segmentation solution will have different strengths and weaknesses, which is why it is so important to set business and marketing criteria for selecting the optimal solution right from the beginning. The science will always provide a best solution based on statistical scores, but the hard part is that there are a host of solutions that will likely meet a statistical threshold. So having clear and concise business and marketing objectives helps connect the segmentation solution to the key marketing and business objectives any business is facing.

market segmentation research

And that’s the goal:  connecting the segmentation solutions to these key marketing elements. At this point we are no longer talking about segmentation schemes in terms of frequency, means and indexes – all the statistical language that most of your organization doesn’t understand or even care about. To set the project up for success (and make sure the results are used) you need to translate the solution choices and options into more common terms people can easily understand so they can confidently trade-off and rank the solutions that will most impact the business. 


Read a Case Study on How Segmentation Helped GE Healthcare

market segmentation case studyThis case study in the Pharma Research Report shows how GE Healthcare and CMB partnered to conduct segmentation that informed and aided business decision making and targeting by GE Healthcare's Picture Archiving & Communication Systems (PACS).  Read the full report here.


Posted by Jeff McKenna. Jeff is a senior consultant at CMB and a lover of the mid-west, the Cleveland Indians, beer and market segmentation.

Topics: market strategy and segmentation