Why Segmentation is fundamental

“I am often asked for advice on Commercial Excellence and pricing related challenges and improvement opportunities. It’s interesting how these dialogues regularly touch upon segmentation”.

[Henrik Ravn Christensen]

Many companies have a blurred picture of their market-, customer- and product segments. Often product segments are seen as “product families” and customer segments are seen as “industries”. – Maybe it sounds familiar?

The challenge is that a non-behavioral based segmentation has limited use to improve business results. As an example, it does not tell about what differentiates customer segments “willingness to pay”, or where you will have the biggest topline growth of deploying additional marketing investments.

With a commercial segmentation based on behavioral insights, you have an opportunity to get away from historically based thresholds and average thinking. When done right, companies can increase both top- and bottom line significantly at the same time. – Let’s get away from “the average”.