Delivering a brand’s message based on each customer’s wants and needs—aka “mass personalization”—is now more important than ever. The key to achieving this calls for pulling an old standby out of a marketer’s arsenal—segmentation.
Segmentation can be a bad word. The mere mention of it can strike fear into the hearts of pharmaceutical marketers and can send sales leadership running from the room. Who can blame them? The pharma landscape is riddled with mediocre segmentations that aren’t actionable, are too complex (when they are not too obvious) and can cause more burden than value to a brand team. Anyone who has ever tried to talk a sales rep into carrying five different printed sales aids in their trunk so they can pull a different one out for each type of doctor knows it doesn’t work.
While this frustration is understandable given the history of poorly implemented segmentation strategy, the old tool of segmentation is once again coming to the fore—only now the consequences of getting it wrong are even higher. It is critical that marketers know the hot-button issue for a specific type of physician and serve the content that matters. This is possible with the advent of new technology that allows marketers to personalize a customer’s experience with a brand on the fly (online, on a tablet in the office, etc.). The era of mass personalization is upon us.
The idea of mass personalization is that a brand can combine technology and insight to create a hyper-relevant experience for every customer. The right message, at the right time, to the right person can maximize engagement and drive ROI. However, to achieve the promise of mass personalization, a brand needs to have a systematic way of evaluating a customer, understanding what is important to that customer, and then altering that customer’s experience accordingly. Since it would be far too onerous (and impossible from a regulatory standpoint) to literally personalize all content to each individual physician or patient, marketers need a framework to subdivide their audience into likeminded clusters and then serve them a relevant and impactful experience. In other words, they need segmentation.
Segmentation is the “engine” that drives a brand’s mass personalization effort—the framework that allows the brand to systematically identify, serve and measure their engagement with a customer. However, for this to work, organizations will need to improve the way they develop and implement segmentation. Here are three critical (and deceptively simple) ways to improve how segmentations are executed in order to realize the value of mass personalization:
ATTITUDES DRIVE BEHAVIORS
There is a historic dichotomy between attitudinal and behavioral styles of segmentation. An attitudinal segmentation tells you the attitudes that drive an individual (the “why”) while a behavioral segmentation classifies a customer based on his/her historic differences in behavior (the “what”). For example, attitudinal gives you aggressive vs. conservative and behavioral gives you high tier vs. low tier—both have their place in building marketing strategy, but in isolation neither is sufficient enough to drive mass personalization. Knowing “why” a customer does something without linking it to a clear and measurable behavior is of little value. Similarly, knowing the prescribing deciles of a group of target physicians without knowing why each physician prescribes in differing amounts is severely limiting. Attitudes can’t be divorced from behaviors in our daily lives, and it doesn’t work in defining marketing strategy either.
The solution is to simultaneously consider attitudes and behaviors when defining your segmentation. What are the key attitudes or beliefs that drive this customer to do this thing? Is it clear how differences in attitudes translate into differences in behaviors? Are those behaviors the ones that are important for my brand (and can I measure them)? Unless your segmentation can show clear differences in critical customer behaviors and then explain why those behaviors are different, it is time to go back to the drawing board.
To aid in this connection of attitudes to behaviors, it is critical to align as an organization on what the key behavior is that you want your segmentation to drive. This “objective” behavior is the key data point that any segmentation needs to predict—in other words, if you don’t see differences in your “objective” behavior, the segmentation isn’t working. You can imagine how segmentation with an objective behavior of “total scripts for treatment X” would be very different than an objective behavior of “attendance at local dinner meetings.” Picking the right behavior (and agreeing as a team) is key to getting the right type of segmentation out of the process (See Figure 1, page 30).
Linking attitudes and behaviors can add complexity to the analysis, but the dividends this improvement will make in the measurable impact of the segmentation will be significant. If you are going to invest in the idea of mass personalization, it is critical that the “engine” is driving changes in the behaviors that matter most to your brand.
TRADE IN A MAP FOR A GPS
Segmentation has historically served a purpose of being the map of a marketplace—basically a check-the-box research effort that took the chaos of any given market and organized it in a simplified, easily digestible format. While this “mapping” has intrinsic value in helping guide a brand team’s strategic thinking, it is not sufficient to power mass personalization. For a segmentation to credibly serve at the heart of mass personalization, it needs to be more like a GPS. A map organizes information, but a GPS gives clear direction.
An effective segmentation that drives mass personalization must have the scope and depth to inform and influence not only brand strategy (the mapping) but also tactical planning, creative execution and even decisions related to what technology needs to be deployed (the direction). Segmentation can (and should) be expected to go beyond just “mapping” the market and instead should provide a robust enough framework to be the centerpiece of a brand’s commercialization activity.
The key step for brand leaders to make this depth a reality is to set the expectation at the initiation of a segmentation project that one of the major outputs must be a clear and actionable set of directives about how each segment should be served from a messaging, media, channel, and technology perspective. Too often segmentations are delivered with reams of data describing the depth of segmentation insight, but not enough thought has been expended on what this means to the brand’s approach to commercialization.
Encouraging this depth from the research team can be as simple as agreeing to the templates of variables that will be used to describe each segment at the beginning of the project. Providing early clarity to your research colleagues that this segmentation must be able to explain not only attitudes and behaviors, but also supply data-supported guidance on how to engage and speak to each segment will influence fielding strategy and survey instrument design for the better. A research team that shares the vision for what mass personalization can deliver (and what it requires to implement) will be a powerful ally in building the critical “engine.”
STAY FOCUSED ON THE GOAL
Given the level of time and budgetary resources that typically must be invested in segmentation, invariably there is a strong impulse that the research must be all things to all people. While the scope of most segmentations does allow for broad applicability across an organization, the most effective segmentations are executed with a clear vision of how and where the segmentation can be used in the organization. Is it going to inform call planning and field training? Is it going to be used primarily as a tool to personalize the website experience? In the case of a patient segmentation, could it be used to increase the relevance of nurse calling programs? You can imagine how a segmentation focused on informing field sales call planning could be materially different from one that is going to drive website personalization.
Similar to the critical need for the brand team to identify and align behind the “objective behavior,” it is also important to have an understanding as to how and where this segmentation engine could be used across the customer engagement continuum from awareness to loyalty. Segmentations that are launched with a clear vision of how they might be used in the marketplace will have a higher resolution and will be more actionable than one which is too general and expected to serve everywhere (See Figure 2, page 31).
It is immensely beneficial to devote time at the beginning of a project to understanding the possibilities of how and where segmentation can be used and then aligning behind a rough prioritization of those uses. Since segmentations are exploratory by nature, you don’t need to be laser focused on only one use, but the more narrowly you can focus on the top priorities, the more you increase your ability to deliver a segmentation that is actionable enough to drive tactical development in the areas where mass personalization can provide the most benefit.
In a mass personalization world, where better technology and deeper customer knowledge can combine to allow a brand to develop more relevant and meaningful relationships with customers, having that insight “engine” to power marketing is critical. When done well, the old tool of segmentation can be transformed to successful play that role in this new world.
