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RedPill Segment Marketing helps you identify & target specific segments of value more effectively. It's a service providing an 'idea to implementation' solution to develop & deliver differentiated segment-centric offers.
Today, many companies still try to build differentiation through a series of product or service introductions. In today's competitive world, this approach does not have sustainable impact and can be easily copied in the market place.
Our experience shows that a segment-centric marketing mode delivers sustainable differentiation and greater profits - immediately. Moreover, it is far more difficult to copy an entire segment experience than a simple new product launch.
What is Segment Marketing?
Segment Marketing is an approach to differentiate services through focused offers & solutions tailored to customer needs. It is a way to increase customer retention & value by creating experiences that match with the customer expectations.
Segment-centric marketing involves:
- Defining & identifying specific set of valuable customers
- Understanding & developing insights into their behaviour
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Does Segment Marketing Pay?
SIA's PPS program ensured higher returns
SK Telecom uses segment experiences to gain market share
Credit card brands stand out through segment marketing
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- Developing & delivering customised experiences for the chosen segment, that allow companies to retain customers and increase customer value
- Continually improving these experiences to acquire higher share of wallet
- Evaluating the program and refining it to attract more customers into this segment
How does Segment Marketing Work?
Segment-centric marketing involves developing and delivering a customised experience for chosen high value segments based on key insights into their behaviour. These segments could include for example, MVCs (most valuable customers), SMEs (small and medium enterprises), youth, families, corporate customers, etc.
Why MVCs?
"For operators worldwide, churn on the top 15% of their customers is, on average, 50% higher than the overall churn."
"The MVC Segment accounts for a significant proportion of telco profits. A full 7% of the profits of a leading S E Asian operator comes from the top 15 of their customers. For another, 10 MVCs provide the same profits as 18 medium and 50 light users."
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For a large technology MNC, our enterprise segment strategy increased account control, improved customer satisfaction and generated higher revenues.
Segment marketing works by providing a differentiated way to serve MVC customers:
- MVCs could comprise only 10% of the customers and yet account for more than 50% of revenues
- These customers are highly demanding & very likely to churn, representing both a retention and an acquisition opportunity for service businesses such as telcos & banks
- An MVC offer provides an 'idea-to-implementation' strategy that can, e.g., improve an average telco's profitability by 6 percentage points through ARPU increase, churn reduction & higher share of wallet
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For SME customers, it works by providing the most effective way to address their diversified needs:
Why SMEs?
"The SME segment across emerging markets is set to grow at over 20%."
"The Thai Govt is working to increase the contribution of SMEs to the economy from 40% to 60%."
"The top 20% of SMEs account for 85% of the profits of a bank. The bottom 30% destroy 15%."
"The SME market in India consists of 800-1000 generic sub-segments, each with widely differing needs."
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SMEs account for a growing portion of every economy in Asia Pacific. Their nature and size makes them a difficult segment to understand and sell to. For example, in one leading market alone, there are over 450,000 SMEs in just the 6 large cities divided into over 100 categories and over 1000 sub-segments.
Most companies want to sell to this segment, but face the problems of high cost of sales, low ROI, poor acquisition rates etc.
Our idea-to-implementation strategy model allows companies to target this segment effectively by building an innovative business platform to target SMEs.
Applying this model we estimate that a regional bank can create over US$3-5 million in new revenues in just a 6 month trial period within one city.
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Click here to read a case study about work we did for a technology MNC where our enterprise segment strategy increased account control, improved customer satisfaction and generated higher revenues.
Click here to read about an assignment we delivered for a leading Indonesian bank, where we helped the client design a strategy to reverse its declining share of the SME market.
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