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What brand segmentation is and how to apply it

Learn what brand segmentation is and how it can boost sales. SurveyMonkey solutions can help.

Segmentation is a helpful way to effectively market and sell your brand’s products or services. With brand segmentation, you can take your marketing and sales to the next level of personalization and optimization. 

Step beyond demographics and traditional market segmentation methods to inform your branding strategies. In this article, we explain how to apply brand segmentation to your market analysis and show how our tools can help. 

Brand segmentation strategy can help direct your use of marketing sales budgets, plan product lines, and determine objectives based on the potential of each segment of your market. This includes designing your brands, products, packaging, messaging, marketing, and sales around specific segments. Instead of offering one brand to appeal to the whole market, brand segmentation offers multiple brands to meet the needs of a variety of consumer segments.

Brand segmentation allows you the ultimate customization opportunities for your products and services. You can:

  • Meet the needs of particular target market segments with brands specifically designed with them in mind.
  • Find the most effective marketing and selling strategies for each brand segment.
  • Determine the profitability of each of your brands and use the information to decide on advertising and marketing budgets.
  • Determine and use the forms of media in your marketing and advertising plans that appeal to each brand segment (television, social media, etc.).
  • Form an emotional connection between the specific brand and potential customers.

Brand segmentation takes various attributes into account. For example, a company that provides B2B and B2C tax services may separate those offerings into self-serve and enterprise brands to meet the very different needs of those customers. Additionally, a company that manufactures cars may have brands that are luxury lines, mass consumer lines, and value vehicles.

The ultimate example of brand segmentation is Proctor and Gamble. The company owns brands across multiple industries, and in many cases, the brands are in the same product space. 

Proctor and Gamble

Proctor and Gamble owns several brands that are segmented for different markets. Tide, Gain, Era, and Cheer are all laundry products. Gain, Cheer, and Era are lower-priced alternatives. Let’s look at the top two brands, Gain and Tide. 

Tide is the most expensive of the four P&G laundry brands and is the best-selling laundry detergent in the US. Their marketing strategy is geared towards upper-middle-class families who need tough, stain-fighting detergent and are willing to spend more to get it. High-profile campaigns have included links to the Marvel Cinematic Universe, the NFL, and Bud Light, as they all appeal to mass consumers. 

Gain offers laundry detergents at lower prices and emphasizes their long-lasting scent rather than cleaning performance in their messaging. P&G targets the narrow segment of consumers who prioritize scent and affordability with this alternative to Tide. Gain’s advertising is more playful and doesn’t focus on performance. Gain appeals to consumers looking for a good value.

Tide’s ad spend is approximately three times that of Gain. With their price differences and varied marketing strategies, P&G keeps Tide and Gain from cannibalizing each other in the laundry product market.

Among their other brands, Proctor and Gamble owns Gillette and The Art of Shaving, two razor and skincare brands. Gillette razors are marketed to the “everyman” who needs to shave. Their basic 5-blade razor costs about $25. A 5-blade razor from The Art of Shaving ranges from $60-200—clearly targeting a consumer interested in luxury goods. Though both brands market a 5-blade razor, they are selling to very different consumers.

Volkswagen

Volkswagen, a car manufacturer, also uses brand and product segmentation to offer vehicles to different consumer markets. VW is its primary mass-market brand, offering a range of vehicle models for the everyday consumer. Its premium and luxury brands include Ducati, Lamborghini, Porsche, Bentley, and Ducati, each with models that sell for prices well above the VW brand. 

Volkswagen cultivates each brand’s image, considering both customer segments and profit potential in its business model. Their message is clear and consistent across the board, indicating that all of its vehicles are high-performance, great looking, and technologically advanced, diverging only to tout prices for mass-market vehicles and status for luxury brands.

These companies are both great examples of using brand segmentation to provide similar products in ways that appeal to varied audiences using more than simple demographic information.

Traditional market segmentation is usually based on demographics such as age, sex, geographical location, income level, education, etc. Brand market segmentation is based on feature sets, product offerings, and solution cases.

When brand segments are applied to your target market, you can use the data as a basis for competitive and marketing assessment. Evaluate your competitors’ brands in comparison to your own and ask these questions:

  • Are they using brand segmentation to address the needs of a diverse customer base?
  • Are they presenting one brand to the market with multiple products? 
  • Is their chosen strategy working for them?
  • Are there opportunities your competitors are missing where one of your brands could step in? 
  • If you’re not already using it, can you utilize brand segmentation to set your products apart from the competition?
  • Are your product lines suitable for division into multiple brands?
    • Is there enough variation to create brands that won’t cannibalize each other?
    • Is your industry in need of multiple brands to meet its needs?

Market segmentation is the practice of dividing your target market into subgroups based on shared attributes such as demographics, location, attitudes, and behaviors. Consumer segmentation is the process of segmenting target buyers based on your understanding of who you are communicating with—what they want and how best to get their attention. 

Brand segmentation is based on product offerings, features, and other brand-centric attributes rather than on consumer-centric features. In other words, you’re building your brands to appeal to specific sets of consumers instead of dividing your consumers (customer segmentation) into groups that fit your brands. 

Brand segmentation requires an in-depth understanding of your brand awareness and perception. Once you research and understand these, you can segment your brand appropriately with data-backed insights.

Brand segmentation works hand-in-hand with your brand positioning, increasing your chances of success with new and repeat customers. By narrowing your focus with your brand segments, each one may be positioned to directly impact the desired subset of your target market.

To what extent is your target market aware of your brand? This brand knowledge is measured with a mix of open- and closed-ended questions that are used to gauge aided and unaided brand awareness.

These metrics can be evaluated over time with our Brand Tracker. Find your current baseline awareness level and keep tabs on it to see if your marketing techniques are working.

To determine your brand awareness, you’ll conduct market research surveys to quantify various attributes, such as:

  • Brand recognition: recognizing your brand in a list that includes you and your competitors
  • Brand recall: your brand comes to mind without prompting when asked about your product category
  • Brand identity: your logos, graphics, imagery, and key messaging
  • Brand image: the intangible values that come to mind when thinking about your brand

Brand awareness surveys provide you with a picture of how the market views your brand. This, in turn, gives you data on how successful your brand segmentation is working for your business. 

What are your consumers’ thoughts and feelings about your brand? Your products, services, employees, and more factor into the perception of your brand and your brand reputation. Brand perception is influenced by social media, customer experience, and advertising and marketing messaging. When using brand segmentation, it’s important to understand how your target audience feels about your brand. This will be a key factor in every aspect of your brand from marketing to pricing.

Measure brand perception with:

Brand sentiment analysis takes text responses and categorizes them in a way that shows the emotion behind the entry. It’s used for open-ended questions requiring a short- or long-form answer. Sentiments are categorized as positive, neutral, negative, or undetected. This analysis is useful in determining the emotional background for entries that are not quantifiable.

Customer satisfaction surveys provide you with data from your customers in regard to their satisfaction levels with your products, services, customer experiences, and overall brand. By quantifying satisfaction, you can monitor your scores for fluctuations and trends over time, address negative issues, and even segment customers based on their CSAT scores.

NPS surveys are the gold standard for evaluating customer loyalty. The single-question survey measures customer experience on a scale of -100 to +100, with a higher score being more desirable. Your NPS score can also be tracked over time and can be used with industry NPS benchmarks to compare your brand with competitors.

Make data-driven decisions to implement brand segmentation into your business strategy. Start with the SurveyMonkey Brand Tracker to learn your baseline levels of awareness, perception, and sentiment. Our tracker will help you evaluate the effectiveness of your marketing efforts for your brands, spot trends, and react to changes in real time.

SurveyMonkey, by Momentive, offers multiple market research solutions for your business. See what we can do to make your brand better today!

Net Promoter®, NPS®, NPS Prism®, and the NPS-related emoticons are registered trademarks of Bain & Company, Inc., Satmetrix Systems, Inc., and Fred Reichheld. Net Promoter Score℠ and Net Promoter System℠ are service marks of Bain & Company, Inc., Satmetrix Systems, Inc., and Fred Reichheld.

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