Use Data-Driven Segmentation to Find Your Target Audience

by   |   December 3, 2014 5:30 am   |   1 Comments

Adam Paulisick, head of marketing and brand, Nielsen Catalina Solutions

Adam Paulisick, head of marketing and brand, Nielsen Catalina Solutions

Earlier this year, Columbia University Press released The Insect Cookbook: Food for a Sustainable Planet, which it touts as “The Definitive Guide to Insects as a Sustainable Food Source.” While the thought of munching on a beetle or a grasshopper is likely to turn the stomach of most people socialized in Western culture, insects are, in fact, a primary source of protein in many cultures, particularly in Africa, Asia, and South America.

While it is unlikely that entomophagy—the consumption of insects as food—is going to take off in America any time soon, there are some compelling benefits to eating bugs: they are high in protein, low in fat, and eco-friendly to farm. It’s not hard to imagine the possibility of a niche market developing among more adventurous, health-conscious consumers—and there are a lot of hipsters in Brooklyn and San Francisco.

So let’s assume you are a more adventurous marketer, or have a more adventurous client. Marketing insects as food to Americans presents an interesting conundrum: How do you find the most receptive audience for such a radical message? Segmenting consumers by age and gender or other demographics is inefficient at best, even for more traditional marketing campaigns because there are no hard and fast rules anymore for what a man or a women will intuitively buy (with few exceptions). The ability to purchase just about anything advertised has virtually no barriers except preference. Furthermore, there simply isn’t a demographic for bug consumers in our culture. So what’s a marketer to do?

The good news is that you don’t have to guess. Data-driven segmentation can be the key to identifying an audience you are trying to reach.

Related Stories

Five Digital Marketing Metrics That Might Tell You Less than You Think.
Read the story »

Retail Analytics Market Poised for Growth, but Challenges Remain.
Read the story »

Advertisers Push for Data to Measure Audiences in Multiple Channels.
Read the story »

For GE Capital, Market Segmentation and Predictive Analytics Improve Customer Retention.
Read the story »

Here’s a quick guide to what types of data tend to inform audience segments:

Store-level: Derived from credit cards, loyalty cards, and other retailer-centric data, spend levels help an advertiser understand the locations where consumers are likely to interact with the product in addition to price point, selection, and the competitive landscape to which they could be exposed. Store data is often used when seeking the heaviest retailer-specific buyers: heavy shoppers of Best Buy to present Black Friday deals, for instance, or perhaps heavy Target shoppers if the retailer wanted to alert their most loyal audience that a new department, event, or offering was coming.

Cart/Basket-level: Again, typically derived from payment method, cart/basket-level data allows an advertiser or retailer to better understand the department in which the shopper spends regularly. This would be an opportunity for someone to be placed in a “heavy cookware/accessories” segment in addition to retailer preference. Basket-level data is especially helpful for mass merchandisers (online or brick and mortar) that offer an almost endless selection of products across hundreds of categories.

SKU-level (Stock Keeping Unit): A reference that allows a retailer to keep track of groups of items independent of the universal way the manufacturer references them across retailers. In this case, someone who had access to the retailer’s inventory or point-of-sale information would be able to add a consumer to a segment such as “buyer of exotic cookbooks” in addition to retailer type and category information.

UPC-level (Universal Product Code): A reference so specific that a retailer can understand the exact type of grooming product, gaming console, or exotic cookbook (such as protein from creepy crawlers) purchased, or other specific variants that align to the most surgical advertisements.

No matter what type of data, the concept of historical purchase affords the advertiser confidence in not wasting impressions on someone who isn’t interested in the subject matter. It’s worth noting, however, that it doesn’t make it any easier to find the perfect creative fit, message, or tone in isolation.

So in the case of our cookbook, being integrated closely to a retailer’s point-of-sale system, you can glean endorsements, ingredients, and other factors in your consideration of how to construct the perfect audience segment. Don’t worry if you don’t foresee yourself advertising bug sandwiches anytime soon. In more traditional terms, marketers are constantly building campaigns around factors such as ingredients, heart health factors, packaging, fair trade, or quite literally anything else listed on or about the product.

Moving beyond just collecting the right data, here are a few ways to use consumer retail sales data find that insect-receptive audience:

Use companion products to identify American bug eaters. Because health and ecology are at the center of the entomophagy value proposition, marketers could serve their campaigns to audiences that are predisposed to low-fat, high-protein foods such as soy, black beans, and lean meats. I see this approach frequently. For example, brands that provide allergy remedies look for consumers who are heavy buyers of tissues when the direct knowledge of a consumer’s allergy condition is less than clear.

Avoid the non-category buyers. Because eating bugs would (initially) be considered completely outrageous in Western society, it’s all the more likely to become a fad among the trendy and health conscious. Nothing screams trendy and health conscious more than heavy buyers of the trendiest produce of the last five years, such as kale and acai. So, clearly, these are consumers to target with the insect-eating message.

But this principle also works in reverse. Frozen food or travel-size product companies would likely avoid those same consumers, as they know that items that expire frequently are clearly not the ideal indicator of consumers who are on the go or are less concerned with fresh products. Although it’s tempting to look at what someone does as the only indicator in addressable media, eliminating the very unlikely buyers might actually be a better way to increase the efficiency of the media spend.

Use lifestyle elements to enhance your purchase-based audience segment. In addition to nutrition, advocates of bug-eating cite the ecological benefits of consuming insects, pointing to the low carbon footprint of farming bugs. Another segment of consumers that may be receptive to the idea of crunching crickets could be households that purchase organic, earth-friendly food, household products, and health and beauty aids.

When attempting to market an unusual or niche product, use your data to segment the audience to identify customers who might be most receptive to your message and eliminate those who would not. Find the companion products, avoid the non-category buyers, and remember that lifestyle can complement past purchase history.

Adam Paulisick is the head of marketing and brand at Nielsen Catalina Solutions (NCS), a joint venture between The Nielsen Company and Catalina. In this role, Adam helps advertisers, agencies, and publishers utilize offline purchase data to increase effectiveness throughout online, mobile, print, radio, and TV media campaigns. Prior to his time at NCS, Adam served as senior director of commercial operations for Nielsen’s Emerging Media division, where he was responsible for driving growth within Europe, the Middle East and Africa.

Adam has a degree in Management from Case Western Reserve University in Cleveland, Ohio, and a minor in Information Systems and Data Structures. He resides in Pittsburgh, Pennsylvania, where he is an Adjunct Professor of Entrepreneurship at Carnegie Mellon University’s Tepper School of Business.

Subscribe to Data Informed
for the latest information and news on big data and analytics for the enterprise.

Tags: , , , ,

One Comment

  1. Posted February 9, 2016 at 6:29 am | Permalink

    It is so important to segment your markets based on their lifestyle behaviour. As you mentioned, “identify customers who might be most receptive to your message and eliminate those who would not” may seem obvious to marketers – but it is ignored by many more times than you think.

Post a Comment

Your email is never published nor shared. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>