Identify Your Unique Customer Segments
by Diana Fischer, on Oct 31, 2016 2:06:00 PM
In the last blog, we shared a 5 Step Process helping teams to build a unique
Customer Value Profile for their enterprise. Focusing on building a unique customer profile, allows organization to delight specific customers, steer away from the competition, and move towards true Value Innovation.
Now, we are going to break down the process into its parts and dive into the details!
Identify Customer Segments
The first part of the process is to Identify your unique Customer Segments. It sounds easy enough. We all know who are customers are…right? We deal with them every day. However, not every customer (or group of customers) is the same. Customers engage in your service or buy your products for different reasons. They likely have very different expectations of your organization and assign different priorities to the services provided.
When I ran physical therapy clinics in the Boston area, I managed two very different customer segments daily. Our organization had built its reputation on the treatment and management of complex neurologic diagnoses (stroke, head injury, spinal cord injury), however over the years had expanded heavily into treating an active orthopedic population.
The two customer groups couldn’t have had more different expectations of our service! The orthopedic patients were typically still working, wanted appointments before or after work, and valued “top of the line” exercise equipment. Many of the patients with complex neurologic dysfunctions were not working, preferred therapy appointments in the middle of the day so that they could schedule specialty transportation, and had many conflicting appointments with other providers.
Prioritize Customer Segments
Once you have identified the difference in your customer segments and Value Profiles, you will find that you may need to reprioritize your customer segments. For true Value Innovation to be successful, you cannot pay equal opportunity to all factors, just those that matter most to your prioritized customer segment. You will have to ask yourself, what customer segment aligns best to your organizational capabilities? What segment is the most attractive?
In the case of our clinic, the neurologic patients were prioritized. The organization felt that a specialization in this area helped with differentiation in the marketplace and strengthened the brand.
Ideally, you may be able to find synergies between different customer segments. In the case of our therapy clinics, we were able to find significant synergies between our two different customer segments operationally. We found that our orthopedic patients didn’t like to come into the clinic the middle of the day, however the neurologic patients did. This allowed us to cross train our staff to handle both types of diagnoses and have fewer staff.
I challenge you to look a little more deeply into the customer segments that you service. Are you breaking them down into segments or treating them as the same? If you want to delve a little deeper into this area, I would recommend looking at the book Market Segmentation: How to do it and how to profit from it by Malcolm McDonald. It’s a great resource on segmentation and drills down into how segmentation must be done to effectively develop value propositions for your customer.