To help differentiate points in research data, segmentation typing tools are key for highlighting respondent groups.
Commonly used in customer research, typing tools will ultimately help you understand your base better by helping to determine the target audience.
With this detailed data, you can make critical decisions based on data to improve your brand.
In this post, we'll cover what segmentation tools are, how they're created, and developing one.
Keep reading!
What Are Segmentation Typing Tools?
Typically created in Excel spreadsheets, segmentation typing tools help input data for specific questions that are known from prior research.
There will be four to eight segments in many projects where a typing tool is used.
They are designed to help assign a customer segment to a respondent based on how they answer a particular series of questions. The typing tool takes a "backward" approach - meaning it reviews historical data to funnel respondents into correct segments once the questions are answered.
Furthermore, typing tools use an algorithm to help assign these segments to customers. For instance, it will follow how a customer responded to questions and then provide percentages for what group they likely belong to.
PS: Segmentation has a shelf life. After about five years, you'll want to refresh the data to ensure your brand stays updated with current trends.
Examples of Segmentation
Now, we'll dive into the different types of segmentation that typing tools can help with.
The most common include demographic, geographic, and behavioral segmentation. Each segment helps brands gain a deeper knowledge of customer preferences, attitudes, and perceptions.
Demographics Segmentation
Designed to reveal data on customer backgrounds, demographic segmentation is essential for creating better products, content, and anything else shoppers may use and/or interact with.
Demographic data also helps pinpoint key customer factors like attitudes, desires, etc.
Common demographics include:
- Age
- Gender
- Race
- Ethnicity
- Income
When using typing tools, there can be strong correlations with demographics for a specific segment. Remember that while typing tools often aren't 100% accurate, they will provide solid indications for segments such as demographics.
As a result, brands can feel confident their customers have been grouped into the proper segments based on the response data.
Geographic Segmentation
Next is segmenting by geographic data.
This segment is critical because it significantly impacts how brands design and tailor their offerings (and even marketing strategies) to their customers. For instance, a marketing campaign designed to target one population may not have the desired impact on another market. This can be done by granular location data, or regions of the geography/country.
This can be a waste of time and money, so analyzing data through the lens of geography is critical to ensure that a brand's offerings are well-received. Ultimately, this will significantly impact metrics like customer satisfaction and loyalty.
Behavioral Segmentation
Lastly, behavioral segmentation is vital because it allows brands to sort customers based on their decisions and usage patterns.
This data is helpful when analyzing how customers interact with products or services while also shedding light on critical aspects like motivations, frequency of purchases, and so on.
The main benefit of using behavioral segments is that they help brands pinpoint their high-value customers, allowing them to better serve their needs.
Behavioral survey segmentation is often the approach that data scientists use. Behavioral segmentation accounts for and spans demographics and geographies, so it is often the most inclusive segmentation approach.
Why Typing Tools Are Helpful for Segmentation
Typing tools give brands a deeper cut of their data, allowing them to become more strategic with their position in the market. Below, we'll briefly cover why they make such a difference.
Enhanced Data Understanding
Using segmentation typing tools adds more authenticity to your customer data.
Knowing more nuanced details like customer feelings and attitudes will allow brands to better understand the data in front of them, all of which typing tools help provide.
Typing tools also allow you to gain insight into future customer segments relevant to your brand.
Automated Segmentation
Conducting segmentation automatically through automated typing tools saves time while still providing quality insight.
Typically, automated segmentation relies on algorithms to help group customers into their proper groups instead of having a researcher manually input the data.
Being automated, this typing tool allows researchers to quickly establish the proper segments in a relatively short amount of time. Additionally, automated segmentation guarantees both accuracy and consistency.
Improved Personalization
One of the critical goals of typing tools is to create a more personalized product or service for customers. This can be anything from physical items to a tailored marketing approach.
Personalization is key for any brand, as it's how they connect with their base. Put yourself into the scenario for a moment - what products or services do you use because they offer that personalized experience?
So, it's no surprise that 89% of marketing professionals see increased ROI after using personalization techniques in their messaging. This is a perfect example of how typing tools can create opportunities for a personalized customer experience.
How to Create a Typing Tool for Segmentation
In this next section, we'll walk through the steps to creating a typing tool for segmentation.
Defining Segmentation Objectives
The first step with anything in market research is to ensure clear objectives. What do you want to get out of the segmentation? How will you use it? Ask yourself questions like this before diving in.
Clarifying the insights you wish to gain will simplify the entire process, we promise!
Data Collection and Survey Design
The survey in question can then be developed with your key objectives. Sometimes, you may use existing data to gather information on your desired target audience.
Either way, it's essential to include details matching your segmentation goals, such as demographics, behaviors, and so on.
Analyze Data and Identify Segments
In this phase, different techniques like cluster analysis, factor analysis, or regression models can be used to help identify those customer segments. Each segment should have meaning based on your key objectives to ensure precise data.
This will help develop your typing tool.
Develop the Typing Tool
Once the segments are highlighted, the typing tool can be developed.
The tool will assign new survey respondents to relevant segments, often involving specific questions. Based on their answers, they will be placed in the proper segment.
Test and Validate the Tool
After the tool is created, it's time for testing to ensure it works properly.
The tool can be tweaked and refined based on the testing to yield the best results. The main goal is to ensure it will consistently place respondents in their proper segments.
Deploy and Monitor the Tool
After the tool has been thoroughly tested, it's time to launch!
The tool will then be ready for use in future market research projects. As with anything like this, monitoring the tool over time is key to ensure everything is working correctly.
Contact Our Segmentation Research Company
Curious about how your customers can benefit from segmentation and do you need a typing tool to get that started?
Thankfully, our team can help answer your questions while providing detailed insight into how a typing tool and segmentation can fuel your brand!
Curious about the rest of our market research services? Get in touch with us today!
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Tim Gell
As a Senior Research Analyst, Tim is involved in every stage of a market research project for our clients. He first developed an interest in market research while studying at Binghamton University based on its marriage of business, statistics, and psychology.
Learn more about Tim, here.
