Summary: This article looks at a post research case study on segmentation with the purpose of identifying value, based on Motorola.
Motorola using cluster analysis software analysis found 3 segments for two way radios. The frost segment’s Ultimate Goal was not been overheard – they wanted to communicate privately, discreetly, or covertly. They wanted do minimise the effort to establish a record of the communication, minimise the number of communications that could be intercepted, and minimise the effort required to communicate discretely. From using identifier variables they found most of these people where law enforcement or security officials. The second segment’s Ultimate Goal was clear, unambiguous and uninterrupted communications when faced with dangerous, even life threatening situations. The wanted to minimise messages misunderstood, number of interruptions, interference and the effort required to use the radio with gloves. They were fire-fighters, police and security who often had to leave their vehicles to perform assignments but maintain vehicle contact at all times. The third segment wanted to do the jobs of using radios to communicate with groups, coordinate activities and perform admin; they were engineers and life guards who made constant use of radios to fulfil their work roles. The wanted to minimize effort to program the device, the time it took to confirm receipt of communication and the number of annoying incoming communications.
Segment 1 got an offering with an enhanced encryption mechanism to prevent others overhearing and noiseless operation. Segment 2 got an offering with voice command operation, emergency locators and modifications to allow gloves. Segment 3 got a model with easier to program radio and mechanisms to ensure message receipt.
Before this segmentation approach based on jobs and outcomes, there was a one size fits all mentality in the entire industry. By focusing on the Famous 4 and optimising the offering with 3 new products that met the reality of the jobs to be done, Motorola was able to eliminate product features that addressed outcomes of little or no importance to the segment.
This approach allows you to see that there are often unique opportunities even in mature markets, to see demanding customer segments that will be willing to pay more, see those segments that are unattractive, find over served markets (those that will accept inferior outcomes along some measures for less cost), determine best ways to enter a market segment ignored by competitors, and score segments on their potential growth – in terms of looking just how underserved need are.
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