A Simple Market Segmentation Exercise

Couldn’t find a simple example for market segmentation online? No worries because today, I will show you a simple example to help you get started on market segmentation.

 

First of all, what is market segmentation?

Simply put, it is the various potential customer’s criteria that your brand/company can greatly serve in order to meet your core objectives. Your core objectives could be brand awareness, increase retention rates, website traffic, or profit-making purposes.

 

How does market segmentation help with your objectives?

Well, if you don’t understand what your customers want, needs or desire – then how can you deliver exciting marketing content that convinces them to try, or even buy your product? Likewise, how would you know what kind of images, language style, content will appeal to your audience? If I was looking for organic salads, I wouldn’t be appealed to an ad that tells you how organic the salad your company makes. But instead, I would be more curious if you show me what makes your salads organic.

That’s why, with a clear market segmentation, it helps you figure which targets of that one particular segment will drive most profits for the brand/company. You can then be positioning of potential marketing content or campaign that is specifically tailored to those targets. As I have learned how to create segmentation during SDD101 (Social Media Strategies) class for SenecaSoMe program, I’d like to share with you my knowledge.

 

Let’s use an example!

I wanted to choose a product that seems ordinary. Something we use every day without knowing but fun to work with so I chose the flip flop industry. FYI, Flip flops and slippers are different. Slippers are shoes that cover your feet with soft materials inside that keeps you warm. Flip flops, on the other hand, can be worn indoors and outdoors. They can look very casual (like those you use for showers), stylish for beach settings, presentable for street walking.

TAKEAWAY: Did you know that flip flops were one of the 111 most iconic design in the last 100 years?

Now, I don’t know much about this specific industry but with some research, it can be noted that even popular brands (Nike, Adidas, Puma) and high-end brands like (LV, Burberry, Dior), have incorporated flip flops in their product lines. Of course, there is the very basic and economical market for flip flops too as a “luxury” possession.

 

Segmenting potential profiles for the Flip Flop Industry

Apart from seeing the different occasions that people use flip flops, hence guessing by instincts their purposes for buying flip flops in the first place – I must say I didn’t know how to start with segmenting possible targets. When this happens, it is at your own stake to use free resources and tools that help you achieve a great understanding of the market and customers.

 

Diving in the research part

I googled brands that especially sold flip flops as their signature products or as one of the main categories (like Havaianas, Olukai, Roxy, Rainbow, Flojos). Visited their websites and took a look at their social media profiles. My realization was that most of their followers are from the most used social media platform – Facebook. Havaianas reached 7.51 million of followers, Roxy (a brand of Quicksilver) has 3.9 million of followers, following by Olukai and Rainbow who had 105 K and 34 K followers respectively. The second social media channel that gets them most followers is Instagram (with up to 85.1 K for Havaianas, 1.4 M for Roxy, 63.7 K for Rainbow and 44.8 K for Olukai).

I also researched retailers that sells flip flops as one of the main categories. Such as Flip Flop Shops (a wholly-owned subsidiary of Cherokee Global Brands), who distributes flip flop products of the brands mentioned before plus others; and FitFlop, who sells flip flops as one main criteria too.

It is interesting to see how all of them categorize flip flops apart from gender and colour. Flip flops can be categorized by materials, functionality, styles, health benefits and even technology! For example, Flip Flop Shops gives options for customers to choose flip flops based on where they will be worn– in a city? Or beach? They even have options for “vegan-friendly”, or “water friendly”. Havaianas gives men with the choices of choosing flip flops that serve special needs.

For example, Men Flip Flops with breathable straps and grooves to absorb impact; or women flip flops with rice patterns on the base to prevent slipping, made with super soft rubber for comfort. Olukai is a rather eco-conscious brand. Their mission is to create quality products with “the smallest footprint on the planet”. The philosophy of their products is to be manufacturers who highlight environmentally friendly production and preservation of the Hawaiian culture, as well as protect natural habitat. Pretty impressive! They even have their own non-profit organization (called “Ama Olukai Foundation” in the State of Hawai’i that was founded in 2014. Roxy is another promising brand as it has been inherited in their products the message to “empower women” since the early 20s. If you check their Instagram and Youtube profiles, there are lots of images of confident looking women, young and middle-aged aspiring to be great athletes in water and ground. We can say that their main targets are females of young to middle age, who aspire to have an active and lifestyle. In their mission, it did mention that they represent a casual lifestyle for young-minded people after all.

I was curious to find out what their audiences were mainly looking for on their websites, what topic they looked at, and what other websites do those audiences visit. Similarweb, a competitor analysis online tool, did the magic for me. By typing the brands’ websites on the analysis, I could see some results for the target audiences and their interest. my findings were quite broad but also helped me with categorizing my segmentation as a step further. Audiences from Havaianas were actually quite health-conscious, a big amount of their visitors visited other websites for food recipes and healthy smoothies recipes, looking for health benefits. Olukai visitors were looking for podiatry (feet treatment), orthotics and foot care. Roxy was mostly associated with fashion, apparel, surfing and snow. And others were related to travelling, comfort, materials, jewelry, beach and holiday.

The results allowed me to have a general idea of my segmentations. Besides that, I researched on their followers, and people who tagged their images as #flipflops or hashtag of a specific flip flop brand name on Instagram and Twitter to get a more detailed idea of the type of audiences that exist in this market. When you check on their profiles, it works as an information base for you to understand the lifestyle, behaviour, their surroundings and what they see as motivational quotes to help you gather all the necessary segmentation data (demographics, psychographics, etc.)

After all the “creeping” process, I disseminated all information and broke down potential segmentation for the flip flop industry into 5:

[Image Sources: Beachgoers, Fashion Divas, Comfort Seekers, Travelers, Athletic Inspirers ]

1 – The Beachgoers

Young and active, always excited for summer to come. Getting a new pair of flip flops every summer is exciting because fashion in the beach is reflected from the choice of flip flops besides bikinis. A pair that associates with their mood, beaches and summer-related feelings (such as sunshine, sunny, bright, happy, adventurous, hot, the sound of waves, palm trees, coconut drinks, pineapple juice)

 

2 – The Fashion Divas

Likes high-end fashion, goes to classic looking restaurants for good dining experiences, likes to be the model of her Instagram pictures. At least 2 or 3 branded items on her/his outfits. If flip flops appear on their bodies it is for a fashion statement, brand show-off to embody status, confidence, and style (that everyone should like)

 

3 – The Comfort Seekers

Families or young individuals looking for flip flops that are worth the money and quality. They are not fuzzy over a pair of normal looking flip flops, as long as they are comfortable, fit for the weather and floor type, long-lasting and the right fit for the family.

 

4 – The Travelers

Nothing beats the excitement and inspiration that comes from taking the time off to see what’s beyond the world to nurture relationships and to deepen self-understanding. Travellers like to share their stories of the many places they go as a couple or with a few close friends. They can be staying at inns, or rely on Airbnb for a convenient and clean stay. They could be animal lovers who support cruelty-free products. Or planet passionate who are eco-conscious who recycle clothes, give their furniture a new life. Social profiles are filled with pictures of themselves in mountains, forests, hills, European streets, South American restaurants, villages in Malaysia, hang gliding in Rio de Janeiro, etc.

 

5 – The Athletic Inspirer

Inspirers who exercise every week (could be yoga fanatics, and people who join regular community centres drop-in programs such as swimming, badminton, basketball, etc.). He/she carries a designated towel, work out outfit and gears, water bottle and the special pair of flip flops for this occasion only. They have their ready-to-work-out image set up and make sure it is comfortable to move around. Materials only for specific use in gyms.

 

Now let’s make a Facebook Ad for the Beachgoers!

Let’s say we wanted to target beachgoers on Facebook mainly. You would automatically want to include a beach scenario with happy looking girls i flip flops and sunglasses perhaps? Of course that seems most desirable, but let’s take a different approach.

[Image Source: Lego Couple]

I used an image that represents a “childish” sentiment yet still relatable to youngsters and young professionals who would love going for a beach spree in the summer. Even though the background isn’t exactly picturing the beach, the shadows of the legos, the orange hat, the colourful flip flops and outwears give the impression that it is hot outside! Time to get out of school and work – treat yourself!

Colours are relatively warm. The image is playful in itself as it suggests adolescence and great anticipation for what’s coming. In other words, small figures exploring a big world (the beach is vast!). The description is supposed to inspire the audience to free up for summer with your loved ones – Going to the beach is to expose yourself without restrictions, to have fun and go wild in the waves. The next line suggest engagement and curiosity provided that the legos were made for this particular ad to increase traffic.

 

I hope you enjoyed your stay and learned something new! If you have any comments or questions, feel free to tweet me or share your opinion  @carolinafchen.