Segmentation research is a powerful tool, but it suffers from past negative associations. Our Chief Innovation Officer, Michelle Castle, and Chief Analytics Officer, Casey Willard, write about how to address common challenges in segmentation research in their latest article for Quirk’s. In it, they draw on their collective experience of conducting over 100 segmentation studies over the past 20 years to outline six key principles to follow when conducting this type of research.

They write: “Segmentation research without a clear purpose, a thoughtful design, and stakeholders committed to the process fails to inform decision-making.” The negative perception of segmentation research can be overcome by identifying clear goals and prioritizing alignment across all stakeholders from the outset of a project. Casey and Michelle say it is important to focus on priority objectives while remaining open to adaptation for long-term impact – without this desired business outcomes anchoring the approach it can lead to “meandering exploration”.

In the article, they outline six principles that researchers should keep in mind when conducting segmentation research.

1. Alignment for Success: Setting clear objectives, defining scope, and aligning all stakeholders are key to prevent complexity and inefficiency. Stay focused on priority goals, while remaining open to adaptation for optimal outcomes, including long-term utility and impact.
2. Hypotheses as Guideposts: Strong hypotheses provide direction, anchoring the research process in meaningful business outcomes. A flexible design that balances hypothesis validation and new discovery exploration creates an intentional roadmap for the research, drawing from various perspectives.
3. Relevance in Design: They encourage teams working on these kinds of projects to avoid being handcuffed to irrelevant factors that divert from core business issues and instead employ inputs that incorporate attitudes, needs, occasions, and behaviors within specific contexts to ensure meaningful differentiation.
4. Metrics that Matter: Anchor segmentation in pre-identified metrics, using trade-off and agreement scales to enhance differentiation. Evaluate input combinations and clustering methods against specific criteria to create distinct and prioritizable segments with growth potential.
5. Engaging Stakeholders: Without buy-in from all parties, any study is doomed for failure. Casey and Michelle write that successful outcomes stem from an iterative process involving deep engagement by all key stakeholders. Collaboration and alignment at each stage lead to solutions that resonate with the organization.
6. Championing Adoption: Internal advocacy is indispensable to guide the research from inception to execution and integration within the organization. The research team must support this advocate with a compelling narrative and a plan for socialization across cross-functional teams to drive understanding and action.

They conclude the piece with: “Segmentation research must be rigorously conducted and statistically sound to be useful. When executed through a highly interactive process involving deeply engaged stakeholders, it is transformative.”

For the complete article, visit: https://www.quirks.com/articles/6-key-principles-for-effective-segmentation-studies