Segmenting based on solution-use outperforms demographics and psychographics in customer discovery

In the past, demographic and psychographic segmentation were the go-to methods for businesses to understand their customers. Demographic segmentation divides customers into groups based on their age, gender, income, education level, and other such factors. On the other hand, psychographic segmentation groups customers based on their interests, values, and lifestyle choices.

However, with the rise of behavioral segmentation, businesses are now moving towards a more effective way of understanding their customers. Behavioral segmentation divides customers into groups based on their behavior and the solutions they use to accomplish their intended outcome.

In this article, we’ll explore why behavioral segmentation based on the solutions users use to accomplish their intended outcome trumps over demographic and psychographic segmentation in customer discovery.

Focus on Actionable Data

One of the biggest advantages of behavioral segmentation is that it provides businesses with actionable data. Demographic and psychographic segmentation may tell you who your customers are, but it doesn’t tell you what they do. Behavioral segmentation, on the other hand, tells you what your customers are doing and what solutions they are using to accomplish their intended outcome.

This information is incredibly valuable because it allows businesses to identify patterns and trends in customer behavior. This, in turn, allows them to make informed decisions about how to improve their products or services to better meet their customers’ needs.

Better Customer Understanding

Behavioral segmentation provides a better understanding of customers because it is based on actual behavior rather than assumptions. Demographic and psychographic segmentation are based on assumptions about a group of people based on their age, gender, or lifestyle choices. However, just because two people share the same age or income bracket doesn’t mean they will have the same behavior or use the same solutions to accomplish their intended outcome.

By segmenting customers based on their behavior and solutions they use to accomplish their intended outcome, businesses can gain a more accurate understanding of their customers. This allows them to develop products and services that better meet their customers’ needs and preferences.

Improved Marketing Effectiveness

Finally, behavioral segmentation can improve the effectiveness of marketing efforts. By understanding customers’ behavior and the solutions they use to accomplish their intended outcome, businesses can develop more targeted marketing messages.

Conclusion

Behavioral segmentation based on the solutions users use to accomplish their intended outcome is becoming increasingly popular among businesses because it provides actionable data, better customer understanding, and improved marketing effectiveness. Demographic and psychographic segmentation may still have their place in customer discovery, but they are no longer enough.

Download our free ebook “Discovering Your Target Customer: A Behavioral Segmentation Playbook” to gain valuable insights and strategies for effectively segmenting your customer base and understanding their behavior. Don’t miss out on this opportunity to improve your understanding of your target customers and their needs. Download now!