Benefit Segmentation-A Decision-Oriented Research Tool[1]

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Benefit Segmentation:

A Decision-oriented

Research Tool

RUSSELL

I HALEY

According

to

this article,

most techniques of market

segmentation rely only

on

DES RIPTIVE

factors pertain

ing

to

purchasers and

are

not efficient predictors of

future buyer behavior . The

author proposes an ap

proach whereby market seg

ments

are

delineated first

on the basis of factors with

a

CAUSAL

relationship

to

future purchase behavior.

The belief underlying this

segmentation

strategy

is

that the

benefits which peo

ple are seeking in consuming

a given product are the

basic reasons for the exist

ence of true market seg

ments.

Journal of MaTketiflU

Vol. 32

(July.

1968). 'Pp. 30·35 ,

M

ARKET segmentation has been steadily moving toward

ce

nter

stage

as a topic of discussion in

marketing

and research

cir cles. Hard ly a conference passes

without

at least one session

devoted to Moreover, in March the American Management

Association held a three-day conference entirely concerned with

various aspects of the segmentation problem.

Accord ing to Wendell Smith, IlSegmenta t ion is based upon de

velopments

on

the demand s id e of the market and represents a

rational and more precise adjustment of product and marketing

effort

to

consumer

or

user requirements.'

The

idea

that

all

mar

kets can be profitably segmented has now received almost as wide

spread acceptance as the marketing concept itself. However, prob

lems remain. In the extreme, a marketer can divide up his market

in as many ways as he can describe his prospects. f he wishes,

he ca n define a l

eft-

handed segment, or a blue-eyed segment, or a

German-speaking segment. Consequently, current discussion re

vo lves la

rg

ely around which of the virtually limitless alternatives

is likely to be most product ive .

Segmen lat;otl Methods

Several varieties of market segmentation have been popular in

the recent past. At least

three

kinds have achieved some degree

of prominence. Historica lly, perhaps the

fU st

type to exi

st

was

geographi c segmentation. Small manufactu rers who wished to

limit their investments, or whose distr ibution channels were not

large enough to cover

the

entire country, segmented the U. S.

market, in effect, by selling their products

on

ly in certain areas.

However, as more and more

brands

became national, the sec

ond major system of segmentat ion--ciemographic

segmentation-be

came popul

ar

. Under

this

philosophy targets were defined as

younger peopl

e,

men, or fam ilies with children. Unfortunately, a

number

of recent

stu

dies have shown

that

demographic variables

such as age, sex, income, occupation and race are, in general,

POOl'

predictors of

be

havior and, consequently, less than optim

um

bases

for segmentation strategies.

2

1

Wendell

R.

Smit

h ,

Product

Differentiation

a nd

Market Segmentation

as Alternative Product Strateg

ie

s, J OURNA.L OF MARKETING,

Vol.

XXI

(J u ly, 1956), pp. 3-8.

2

R

ona ld

E. Frank,

HCorrelates of Buyi

ng

Behavior

for Grocery

Prod

ucts,

JOURN

AL OF

MARKETING

,

Vo

l.

31 (Octobe r,

1967),

pp. 48-53; Ron

ald E. Frank, William Ma

ssy, a nd

Harper

W. Boyd, Jr .,

Cor

rela

tes

of Grocery

Product

Consumption

Rates,

Journal of Marketing

R e

sea.rch

Vol. 4

(May, 1967),

pp.

184-1

90; and Clark

Wil son, Home_

maker

Living Patterns and

M

arketplace Behavior-A Psychometric

Approac

h , in John S . Wright and Jac L.

Goldstucker,

Editors, New

Ideas

for

Succe88ful Marketing

P roceedings

of

1966 Wol'ld Consrrcss

(Chicago:

American

Marketing

Association,

June, 1966), pp. 305-331.

30·



Benefit

Segmell

tation A Decis i

on oriented

Research Tool 31

More recently, a third

type

of

segmentation has

come into

increasing favor-volume seg

m

en t

ation.

The so-called '4heavy ha

lf

theory, popularized

by

Dik Twedt o[ t he Oscar Mayer Co mpany, points

out that in most

product

categories one-half of the

consumers account

for

around 80

q. of the consump

t ion. f

this

is

true,

the argument goes, shou ldn 't

knnwledgcable murketc)'s concent r

ate

their eft

olts

on the.se high-volume

consumers

Certa inly they

are the most valuable consu mers .

The

trouble

with thi

s line of reason

ing

is

that

n

ot

a

ll

heavy

consumers

il

re

llsually avai lab le to the

same

brand-because

they a re not all

seeking

the same

kinds of benefits from a product. F or example,

heavy coff ee drinkers

cO

::;ist of two types of

COIl

sumers-

those

who d r ink chai n

sto

re

brands

and

t hose who

dr

ink premium brands. The chai n store

custo mers feel that all co ffees

ar

e basically alike and.

because they drink .so much coffee, t hey fee l

it

is

sensible to buy

a

relcltively inex])ensive

brand. The

prernium orand buyers, all

the

othe r hal1 1. feel

that

the

few added pennies which coffees like

YubHI1.

Martinson's,

Chock Full O'Nuts, and Savarin cost

are more

than justi

fi ed

by

their fulle)'

taste.

Obvi

ously, these two g roups of people,

although they

are

both members of the heavy half

segment.

a re not

equally good prospects for anyone brand, nor can

they be expected to respond to the

same

advert i

sing

cla ims.

These three

systems

of segmentati on have 'been

lIsed because

they

provide helpful

guidance

in t he

use of certain marketing tools.

For

example, geo

gnlphic segmentat ion . because it describes the mar -

ket in a discrete way, provides definite direction in

media p

ur

chases. SI

)Qt

TV.

spot

radio,

Clnd

news

papers CHn

be bought for the geographical

seg

ment

se lected fo), concentrated e

ff

o

rt

. S imil

ar

ly. demo

graphi c segmentation allows media to be bought

more efJicient ly since demog raphic data on readers,

viewers, and

listeners ar

e readily

ava

ilable fo) mo

st

media veh icles. Also. in some

product

categori es

demographic

var

iab les

are ext

remely helpful in dif

ferentiating

users

fro

m non-users, although they are

t y p i C ~ l l l v

l

ess

helpful in di

st i

nguishing between the

usel's

of

va r i

ous

b

rand

s. The philoso

phy is especia

ll

y effect ive in

directing

dollars w ~ l r d

the most important parts of the

mark

et .

However, each

of

these

three syste

ms

of

segme

n

tation is handicapped by

an

underlying dis

advantage

inh erent in its nature.

All

are b ~ l s e d on an ex-post

facto anHiysis of the

kinds

of people who make up

var ious segment s of a nUlI·ket. They rely on de-

1c

riptiv

factors

rather than cawml

factors.

For

this reason t hey are n

ot

effic ient

pr

edictors of future

:J

Oik

Wurr

en 'fw edt,

So

me

Practic

al Applications

of

the 'H eavy

Half

' Th eor

y

(New

York:

Ad

vert

ising

Research Foundation 10 th Annual Conference, Oc-

tobe,' 6, 1964).

buying behHvior,

and

it is future buying be

ha

vior

~ l t

is of

centra

l inte r

est

to

marketers.

Benefit Segmentation

An approach to

mnrket segmentation

whereby it

is possible to identify market segments by c;Hlsal

factol's J'Hthel' than descriptive factors, might be

ca

ll

ed benefit segment ation. Th e belief under

lying

this

segmentation strategy is that the bene

fits which people Hre seek in g in consuming a given

product Hre the basic reHSOIH:\ for the existence of

true market segment s. Experience

with

this ap

pr oach

has show

n

that

benefits sought by

consumers

determine their behavior

much

more

accllrately

than do demographic charncteristics or volume of

con

sumption.

This does not mean that the ki nds of dabl

ga t

hered in

mOre

traditional types of

segmenta

ti on

are not useful. Once people ha ve been class

ifi

ed

into segments in accordullce with the benefits they

are see

king.

each segment is

cont

r

asted

with all of

t he

ot

her

segments

in

terms

of it

s

demography, its

vo lume of consumption,

its

brand perceptions,

itt:;

me

dia habit

s, its personality and li fe-style, and so

forth. In th is way. a reasonab ly deep understanding

of t he people who make up eHch segment can be

obta ined.

And by

cap itali

zing on

t hi s undel'sbllld

ing,

it

is possible to reach them, to talk to them in

their OW11

terms,

and to present a product in the

most favo

.

able ligh t possible.

The

benefit segment ation

approach

is not n

ew

.

1t

has been employed by a number of Ame rica's largest

co

rp

orati ons s in

ce

it was introduced in ]961. How

eve r, case hi tori es have been notably absent

from

the Iitel'ature

because m

ost studies

have been con

tl'acted for

privately. and have

been treated

confiden

tially.

.\ RU$seli

1.

Haley, HExperimental Research on Atti

tudes Towu rd Shampoos, an unpublished papel (Feb

ruary,

1

96t).

• ABOUT THE AUTHOR. Russe ll

I.

Hal ey is Vice Pr esi

dent

and Corporate

Research Director

of

D'Arcy Advertis

ing

in

New York City. Prior

to hi

s cur

rent position he was Vice Preside nt

and

Associate Director

of

the Marketing a nd

Research

Department

at

Grey

Adv e rtis

ing. While there. he developed

new

methods for measuri

ng attitudes

. a

unique way

of segmenting

markets by

attitude patterns

.

and

improved

methods

of conducting

large-sca le market tests. Mr. Haley received

hi

s

M.B.A. from Columbia

in

marketing and statistics.

Mr.

Haley

is a

past

president

of

the Cleveland Chapter of

the

American Statistical Associ ation. He

is

a member of the

American Market ing Association . the Americdn Associdt ion for

Public Opinion Research. dnd the Executive Committee

of

the

Copy

Research Council. Mr. Haley

is

currently

Chairm

a n

of

an

A.R.F.

CommiHee dealing

with attitude measurement

and

teaching at

Rutger

s University.



32

Th

e bene

fi

t segmentn

ti

on a

ppr

oach is based upon

being able to meas

ur

e

co

nsumer va

lu

e sy

te rn

s in

deta il ,

t ogethel

wi th what th e consumer thinks

ab

out

various b

ra

nds

in

th e prod u

ct

category

of

interest.

While thi s concept seems s imple enough, oper

at

ion

a

ll

y

i t

is very

co

mplex.

Th

ere is no s imple s

traigh

t

fo

rw

ard way of handling th e volumes

of

da

ta

that

have

to

be

ge

nerated.

Co

mpu ters and sophi s

ti

cated

multivari ate att itude m

eas

urement techniques are a

necessit y.

Seve

ra

l al tern

at

ive stati sti cal a

ppr

oaches can be

employed , among th em t he so-ca

ll

ed Q technique

of

f actor

an

a lys is, multi-d imensional scaling, and

other distance measures. ) All of

th

ese methods

re

late

th

e

ra

t in gs of each respo

nd

e

nt

to t hose of every

oth er respondent and t hen seek clusters

of

individ

uals wit h sirni)nr

ra

t ing pat terns. f the items

rn ted are potenti a l consumer benefi ts, the clu sters

that

emerg

e will be groups

of

people who a

tt a

ch

simila r d

eg

l'ees

of

imp

OI

ta nce

to

th e various benefits ,

Whatever

th

e

stati

st ical

ap

proach selected, t he end

res

ul

t of t he ana

ly

s is is likely to

e

between t hree

and seven

co

nsume

I

segme

nt

s, each re

pr

esent ing

a

pote

nti

a

ll

y

pr

odu

ct

ive foca l point fo r

mark

e

ting

effo

rt

s.

Ea

ch segment is identified by t he benefi ts it is

see

king

, However , it

is th

e total con

fi

lt·

utio

n of

th

e benefits

soug

ht which differ

en t

i

ates

one se

gment

from ano

th

er,

ra

ther

th

an t he

fact

that one

is seekin g one

parti

cu la r benefit and anoth er a

quit

e

different benefi t.

Indiv

idual benefits are likely to

have appea l for severa l segme

nt s. In

f act .

th

e re

se

ar

ch

th

at h

as

been done thus far suggests t

hat

most peo ple would

like as

many benefits

as

poss ible.

However ,

the

e

lative

impo

rt

ance

th

ey at tach to

in

dividual benefits can differ impOl·ta nt ly and, accord

ingly, can be used

as

an effecti ve lever in seg ment

ing ma

rkets.

Of co

ur

se, it is possible

to

determine benefit seg

ments intui t ive ly as

well as

with compute rs and

sophis

ti

cated research meth ods. The kinds

of

bril

liant ins ig

ht

s which pl'oduced t he

Mu st lmg

a

nd

th e

fir

st

IOO-millimeter cigarette have a good chan ce

of

succeeding whenever

mark

et ers a re able to

tap

an exis

tin

g benefit

se

gme

nt

.

However, in

tu

iti on can be very expensive when it

is

mi s

ta k

en. Ma

rk

e

ti n

g

hi

story

is repl

ete

with

e

x

amples of

pr

odu

cts

whi ch som

eo

ne fe

lt

co

uld not

miss. Ov er

th

e longer te

rm

, system

at

ic benefi t seg

men

ta ti

on research is likely to have a higher

pr

o

po

rt i

on of su

cc

esses.

But is benefit segme

nt

a tion

pract

ical ? And is it

t

ru l

y operat ional ?

he

answer

to

b

ot

h of

th

ese

qu

es t

ions is

yes

.

In

effect, th e crux of

th

e prob-

R

ona

ld

E. Fran

k a nd

Paul

E . Gr

ee

n,

Nu m

eri cal

Taxonomy in Marketing Anal ys is: A Review At·ti cle.

Journal of Marketing Research Vol. V ( F

eb ruar

y,

1968), pp. 83-98.

-

Jo

urnal

of M arket;IIg J

uly

1968

te

rn

of choos

ing

t he best

se

gment

at i

on

syste

m is to

dete

rm

ine which h

as th

e g reatest number

of pr

ac

tical

marketing

implic

at i

ons. An example should

show tha

t benefit

segmenta

t ion h

as a

much wider

ra

ng

e of implica

ti

ons

th

an alte rnat ive fO

m

s

of

segme

nta

t ion.

A n Examp le of Benefit Segm entation

While

th

e

mat

eria l

pr

esen

te

d here is

pur

ely illus

trative to

pr

otect

th

e compet it

iv

e edge of companies

who have invested in stud ies of thi s kind,

it

is based

on

ac

tu

a l

seg

men

ta t

ion st udies.

Co

nsequ ently.

it

is

quit

e ty

pi

cal

of th

e kinds

of

t

hing

s which a re nor

mally lea rned in the

co urse

of a benefi t se

gm

en

ta

tion s

tud

y.

Th

e too

thpa

ste market h

as

been chosen

as

a n ex

ample because it is one wit h which everyone is

familial'.

Let

us

ass

ume

th

at

a

benefit segme

nt

a

ti

on

s

tud

y has been done Hnd

'fOUl'

major segme

nt

s have

been id entified

--o

ne pa

rt i

cularly

co

ncerned w

ith

de

cay

pr

eventi on, one with bri g

htn

ess of

teet

h. one

w

ith

t he

fl

avor and appea ran ce of t he prod u

ct

, and

one

with pri

ce. rela

ti

ve

ly la

rg

e amount of sup

pleme

nt

a ry

inf

ormat ion has a lso been gather

ed

(Table 1)

ab

o

ut

t he people in each of these segments.

The decay

pr

eventi on

se

gment . it h

as

been found,

co

ntain

s

a

dis

pr

opo

rt

io

nat

ely large number

of

fam

ilies with childl'en.

Th

ey are seriollsly

co

nce

rn

ed

about th e poss ibi lity of cavit ies and show a de fin

ite

prefe rence for fl uo ride too thp

as

te.

Thi

s is re

in

forced by their

pe

rsona lities. Th

ey

tend to be a

little hyp

oc

hondr iacal and, in t heir

li

fe-styles, t hey

are less socially-oriented than some

of

t he

ot

h

er

groups.

Thi

s segment has been named The Wo

rr i

ers.

Th

e second se

gm

ent.

co

mprised

of

p

eo pl

e who show

co

ncern for

th

e bri g

htn

ess

of

the

ir teet

h, is quite

different . t includes

a

relat ively l

arge gr

oup

of

yo

ung

ma

rr i

eds.

Th

ey smoke more

th

an ave rage.

Thi

s is where

th

e swin gers are. They are strongly

social and their life-style pat te rn s are ve ry active.

This is

pr

obably th e grou p to which too thp

as

tes such

as Macle

an

s or

Pl

us

Whit

e

or

U

lt r

a Brite would

appea

l. Th

is segment has been

nam

ed

Th

e Soci

ab

les.

In th e

third

segment, t he one which is par t icular ly

concerned wit h

th

e fla vo r and appea

ra

nce

of

the

pr

o

du

ct. a

larg

e port ion

of

th e bra

nd

deciders ar e

c

hildr

e

n.

The

ir

use

of

spe

arm

i

nt

t

oo

th

paste

is we

ll

above average. Stri pe h

as

done rel

at

ively well

in

this segment. Th ey a re more ego-cente red than

other segment

s,

and t heir

li f

e-style

is

outgo

ing

but

n

ot

to the extent

of

th e swin

ge

r s. They will be

called The

Se

nsory Segment .

The fourt h segment, t he price-ori en

te

d

seg

ment ,

shows a

pr

edominance of men.

t

t ends to be

ab

ove

ave

rage

in

te

rm

s of toothp

aste

usage. P

eo pl

e in

t

hi s segment see very few meanin

gf

ul differences be

tw

een brands. They

sw

itch mo re fr equently than



•

•

Be e/it Segmentation:

D e c ; s j o u ~ o r j e 1 J l e d Research Tool

33

TABLE

T

OOT HPA

STE

MAR

KET

SEGMENT DE

SCRIPTION

Sel1ment: Name : The Sensor

Se

ment:

Principa l bene

f i t so

ugh t:: Fl

avor

,

product appearance

Demograph:1c s t

rength

s :

Child r en

Special behavio

r a l Users

of

spearmint

ch a r ac te r i s t ic s : flavored toothpas te

Brands

disproport ionate l y Co l gate ,

Str ipe

favored:

Personality

cha

ra

cter i s t i cs : High self-involvement

Life s tyle ch a ra c te r i s t i cs : Hedonistic

people

in

other seg ments and tend to

bu

y a brand

on sale. In terms of personality, they are cognitive

and they

are

independent. They like to

think

for

th

emselves a nd make brand choices on

th

e basis of

their judgment. 'fhey will be ca lled The Independ

e

nt

Segment .

Marketing Implicatio ns of

Benefit Segm

entat

ion

Studies

Both copy di rections and medi.a choices will show

shurp differen ces depe

nding

upon which of these

seg ments is chosen as the ta rge t The Worr i ers , The

Sociab les, The Sensory Segment, or The Independent

Segment. F or example,

th

e tonality of the copy

will be light if The Sociable Segment or The Sen

sory

Segment

is to be addressed.

t

will be more

serious if the co py is aimed at The Worriers. And

i f

The Independent Segment is sel

ec

ted , it will prob

ab ly be desirable

to

use rational, two-s ided argu

ments. Of course, to talk to this group

at

a ll it

will be necessa ry to have either a pl'i

ce

edge or

some kind of demonstrable product superi ori ty.

Th

e depth-of-sell reflected by the copy will a lso

vary, depending upon

th

e segment which is of in

terest It will be fairly

in

tensive for The Worri er

Segment and for The Independe

nt

Segment, but

mu

ch m

ore

su perficial and

mo

od- ol'iented for The

Sociable and

Sensory

Segments.

Likewise, t he

set

ting

will

vary

.

t

will

focus on

t he produ

ct

for The Sen

so

ry Group, on socially

oriented s

ituati

ons for The Sociable Grou p, and

perhaps on demon

st

ration or on competitive CODl-

pn 'i so ns for

The

rndependent

Gr

oup.

Media environments will also be tailo red to the

segments chosen as targets. Those with seri ous en

vii'onments

will

be used for

Th

e Worrier and

Inde

pendent Segments, and th ose with youthful, modern

and active environments for The Sociable and the

Sensory

Groups. For example, it might be logical

to

use a larger

pJ op

ortion of television for The So-

The

In d

ependent

The Socisbles The Worriers SeO'ment

Brightness of teeth Decay prevention Pr ice

Teens young

people

Large families Hen

Smoke

rs

Heavy

users

Heavy users

Hacleans

Plus White , Crest

B r a n ~

on sa le

Ul t r a Bri te

High sociabiHty

High hypocho

n-

H gh

dr i a s i s autonomy

Active

Conservative

Value-oriented

ciable and

Sensory

Groups, while The o o

rr i

ers and

fndependents

might

have heavier print schedules.

The depth-of-sell needed

will

also be reflected in

the media choices. For The Worr ier and Rat ional

Segments longer co mmerCial

perhap

s 60-second

commercial would be indicated, while for the

other two

groups

shorter commercials and higher

fr

equency wou

ld

be desirable.

Of co urse, in med ia selec tion the facts

that

have

been gathered about the demographic characteris

tics of

th

e segment chosen as the tnt'get would also

be taken into

co

nsider ati on.

The information in Table 1 also has pack

ag

ing

implica tions. For example, it might be appropriate

to have

co

lo

rful

P < ~ c k a g e s

for The

Sensory Segment,

perhaps

aqua

to

indicate fluoride ) for The Wor

rier

Gr

ou p, and gleaming white for The Sociable

Segment because of th eir interest

in

bright white

teeth.

t should be readily apparent that the kinds of

in formation normally obtained in t he cou rse of a

benefit seg menta t ion st udy have a wide

rang

e of

marketing

implications. Sometimes they are use

ful n suggesting phYSical changes in a

pr

oduct.

For example, one ma

nufa

c

tu r

er discovered that hi s

product was

weLl

su ited

to th

e needs of his chosen

target with a single exception in

th

e area of

fl

avor.

He was able

to

make a relatively inexpensive modi

fication in his product and thereby

stre

ngthen his

market

positi on.

Th

e new

pr

oduct impli

cat

ions of benefit

m e n ~

tation studies a re equally apparent. Once a m a r ~

keter

understand

s

the

kinds of segments

that

e

xi

st

in hi s ma rket, he is often able to see new pl'oduct

oPPOl'tunities or particularly effective ways of posi

tioning the products emergi

ng

f r

om

hi s resea rch and

development operati o

n.

Similarly, benefit segmentation information has

been found helpful in

pr

ov iding direction in the



34

choice

of

compatible

point-oi-purchase materials

and

in

the

selection

of the

kinds

of

sales promotions

which

are

most likely to be effective

for

any given

ma ket target.

Ge n

er a

liz

ations

from

Benefit

Seg

mentation St udi

es

A numbel' of generalizations

are

possib le on

the

basis of the major

benefit segmentntion

studies

which have been conducted

thus far. For

example,

the following general rules of thumb have become

apparent:

•

t

jg

easier

to ulke

advantage of market

seg

ments

that

already

exist than

to

attempt to

cr

eate

new ones. Some

time

ago

the strategy

of product

cUlfel'entiation

was heavily empha

sized in

marketing

textbooks.

Under th

is phi

losophy it was believed that a

manufacturer

was mure

or

less able

to create

new

market

segments

at

will by mnking his

product

some

what

different

from those of his

compet

it

ors.

Now i t is generally recognized

that

fewe)' cost

ly e lT

ors

will be made

if

money is first in vested

in consumer research aimed

at determ

i

ning

the

present

contours

of

the

market,

Once

this

knowledge is available, it is usually most

effi-

cient

to tnilor

marketing strategies to exist

ing

consumer-need

patterns.

• No brand can expect

to

appeal to all consumers.

The

very

act

of

attract

i

ng

one segment may

automaticall

y a

li

enate others. A corollary

to

this

principle is that any

marketer

who wishes

to

cover a

market

fully

must

oife

l

consumers

more

than

a single brand.

The

flood oJ new

br

ands

which have r

ece

ntly appeared on

the

market is concrete recognition

of this

principle.

• A company's

brands

can sometimes canniba

li

ze

each

other but

need

not

necessarily do so. t

depends on whether

01'

not they al'e positioned

against

the

same

segment of

the market, Ivory

Snow sharply reduced Ivory

Flakes'

sha re

of

market,

Hnd

the Ford

Falcon

cut

deeply into

the sales

of

the standard size

Ford

becnuse, in

each case,

the

pl'oducts we re competing in the

same segments.

Later

on,

for

t he same

com-

panies.

the Mustang

was successfully

intr

oduced

wi

th compamt

ively little

damage

to

Ford;

and

the

success of

Crest

did

not

have a dispropor

tionately adverse effect on Gleem's market

posi

tion

because, in these

CHses,

the

segments to

which the products appea led were different.

• New and old products alike should

be

designed

to fit

exactly the

needs

of

some

segment of the

market.

In other

words, they should be aimed

at

people seeki

ng

a speCific combination

of

bene

fits. t is a marketing

truism that

you se

ll

people one

at

a

t ime-that

you have

to

get

8 fHneOne

to

buy

your

product before you

get

loltr ,,[ of MarketillK

llt[

y 1968

nyone

to buy it, A s

ubstantial group

of peo

ple

must

be

interested

in your spec

ifi

c

set of

benefits before yOll can make progress in a

market. Yet, many products

attempt

to aim

at

two

01'

more segments Simultaneously. As

a result,

they are

not able to maximize

their

appeal to any segme

nt

of

the

mal'ket. and t h

ey

run the

ri sk

of ending

up

with

a dangeroLisly

fuzzy brand image.

•

Marketers

who

adopt

a benefit segmentation

strategy have a

distinct

compet it ive edge. f

a benefit se

gment

can be located wh ich

i5

seek-

ing

exactly

the

kinds

of satisfactions

that one

marketer's brand can offer

better than

any

other

b

rand

, the rnarketel can almost cer

tainly

dominate

the

purchases

of

that

segment.

Fur

the

rmore,

if

his competit

ors are

looking

nt the

market

in

terms of

tl'aditiollHI types of seg

ments. they may not even be

aware of the

exist

ence

of

the

benefit

segment

which he has chosen

as

his

market target

. f they

are ignorant

in

this sense, they will be at a loss to expla in

the

success

of

his brand. And it

naturally

follows

that if

they do not

understand

the

reasons

fa,

his Sll ccess,

the

kinds

of

people buying his

brand. and the

be

nefits they

are obtaining

from

it, his competitors wi ll find it

very

diflicult to

successfully

attack

the

marketer's

position.

• An

understanding

of the

benefit segments which

exist within

a

market

can be used to advantage

when competitors introduce new products. Once

the

way in which consumers

<lre

pOSitio

ning

t he new

product

has been determined,

the

like

lihood that it will make

major in r

oads into

segments

of interest

can

be

assessed, and a de

cision can

be

made

011

whether 01'

not counter

actions

of any

kind

are

required.

f

the new

product appears

to be assuming an amb iguous

pOSition, no money need be invested in defensive

measures. However, i f i t appeal's

that the

new

product is ideally

suited to the

needs of an

important segment

of

the

market. the m n u f ~ c -

ture l

in question can introduce a new com

petitive product

of

his own, modify

the

physical

properties

of existing

brands, change his adver

tising

st

ra t

egy ,

or take whatever steps

appear

appropriate.

Types

of

Seg

ments Uuco1lered Through

Bene

fit Seg

metJlatiOtI S

tudi

s

t is diflieult

to

generalize about the types of

segments

,\Chich

are

apt

to be discovered

in

the

co

urse of

a benefit

segmentat

ion

study.

To a large

extent,

the segments

which have been found have

been unique to

the

product categories being ana

lyzed. However, a few types of

segments

have

appeared in two

0

1 more

private

studies. Among

them

are the

following:

.



Benefit Segm en tation A Decision-oriented Research Tool 35

The Status Seeker

The Swinger

The Conservative

The

Rational Man

The Inner

directed Man

a group which is ve ry

much concerned w

ith

the

pre s

tig

e of

the

brands

purchased.

a group which

tries

to

be mode

rn and up

to

date in all of its activi

ties.

Brand

choices re

flect

thi

s

orientat

ion.

. a

group which prefers to

stick to large successful

companies and popular

brands.

. a group which looks

for

benefits such as econo

my, value, durability,

etc.

a

group

which is espe

cially concerned with

self-concept. Mern bel's

consider themselves to

have a sense of hum or,

to be

independent

and /

or honest.

or, for that matter,

any of

them exist in any given

product category. Finding out whether they do and,

if so, what should be done

about them

is the pur

pose

of

benefit

segmentation

research.

Co nclu

sion

The

Hedonist a

group

which is con

cerned primarily with

sensory benefits.

The

benefit segmen

tation

approach is

of particu

lar

interest

because

it

never fai Is to

pr

ovide

fresh

in

sig

ht into

markets.

As was indicated in

the

tooth

paste example cited earUer,

the marketing

implica

tions of this analytical resear

ch tool

are

Limi ted

only by

the imagination

of

the

person

using the

inf

o

rmati

on a segmentation study provides.

In

effect, when segmentation studies

are

conducted, a

number

of smaller markets

emerge instead

of

one

large

one. Moreover, each

of these

smaller

markets

can be subjected to

the

same kinds

of thorough

analyses

to

which total m

arkets

have been subjected

in

the

past.

The

only difference--a cr ucial

on

is

that

th

e total

market

was a heterogeneous conglom-

eration of sub-groups. The so-called

average

con

sumer

existed only in

the

minds

of

some marketing

people. When benefit

segmentat

ion

is

used, a num

ber

of

relatively homogeneous segments

are

uncov

ered. And. because they are homogeneous, descrip

tio ns of them in

terms

of averages are much more

appropriate

and

meaningful as marketing

gu id es.

Some

of

these segments

appear

among

the

cus

tomers of almost all products and

se

rvi ces. How

ever,

there

is no

guarantee

that a

majority of

them

-------------MARKETING

MEMO---- - - - - - -

-

A difference between managers and scientists

basic controversy revolves around

th

e question of problem vs . technique orienta·

on. In the extreme, managers are interes t

ed

in problem solving regal'dl eS5 of tech

nique,

and

scientjsls are interested in sophisticat ion of method regardless of app

li

ca·

bility.

Yet the quest ion of

pure

vs app

li

ed research is really one of degree rather

than kind, and th ese designati ons are rea lly related to long- and shor t-term con

si_era

ti

ons. However, overemphasis

on

pure resea.rch and technique developmenl

ralher than problem solving has resulted in low yield fr om inv

es

tm en ls

in

mpnage

menl science. The percentage of recommendations that eventually affect operations

has been mise rably low.

- James E Rosenzweig, Managers and

Management Scientists (Two Cui·

hIres) , Business Horizons Vol. 10

(fall, 1967

), pp

79.86, at pages 79,

and 80.

Documents

Benefit Segmentation-A Decision-Oriented Research Tool[1]