Page 4: Market segmentation
Customers have different needs and wants, likes and dislikes. For example, not every person likes the same motor car or has the same taste in clothes. There are many different types of consumers with different types of needs. Experian aims to treat all consumers as individuals. Market segmentation helps to turn marketing into a science. It does this by separating a market into parts called segments. Each segment contains groups of customers who are likely to respond in a particular way to marketing activities. Market segmentation involves three elements. These are:
a) segmentation, in which the market is divided into segments
b) targeting, where an organisation identifies specific segments and provides products and services relevant to those segments
c) positioning, where the strategy uses customers' views to define the location of a product relative to other products in the market.
The marketing team at Experian wanted to identify the nature, characteristics and type of consumer who would be interested in CreditExpert. Markets are segmented in a variety of ways. Experian used its knowledge of consumers who had applied for their statutory credit reports in the past to help segmentation. It built up a profile of the consumer it wanted to target. This took into account people's ages, where they lived, their gender and socioeconomic grouping.
It was important to develop an image that would be appropriate for the product that was being offered.
Experian wanted to attract people with certain characteristics, such as people who were:
- Internet users
- credit users
- keen to manage their financial affairs well.
These were people who might read the financial pages in daily or Sunday newspapers or visit personal finance websites. This profiling helped marketers at Experian to identify which groups they would then target with information about the new CreditExpert service. Experian might be a new name to many individuals in consumer markets.
CreditExpert was a new UK brand. It was important to develop an image that would be appropriate for the product that was being offered. Having a profile of the most likely customer also helped Experian to develop a promotional campaign that would position the product in the minds of its potential customers.