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The globalization of markets means companies rarely do business in only one part of the world anymore. Access to technology continues to impact societal norms, political agendas, media consumption, and, thus, economic growth, in countries around the world, ensuring that most businesses can no longer rely on a “one-size fits all” marketing approach; on the contrary, to remain competitive companies must recognize and cater to a significantly larger and much more diverse audience of consumers, creating multiple — customized — strategies that allow them to develop, position and sell their products on a global scale. The key to much of today’s business, then, is international market segmentation. Take a look at the three basic ways to segment global markets:
The main problem with a global market is, of course, its heterogeneity. When compared to a local or even national market, a global market includes a much broader range of cultural and economic differences. And if the purpose of market segmentation is to divide consumers within a market into groups of people with similar habits and needs so that a company can better tailor its marketing practices to them, then having a population with much more robust and varied characteristics means segmentation is even more warranted. The first step, therefore, is to divide a global market via generalized (i.e., “macro”) country-based characteristics such as GNP (Gross National Product); political or religious perspective; language; or other large-scale socioeconomic and geographic variables. Needless to say, such generic grouping can (and does) have limitations, one of the biggest of which can be the failure to accommodate the intricate needs of individual consumers. However, macro-segmentation is needed initially so that further research can become more focused and precise and doesn’t often cost companies a lot of time or money; much of the information needed for macro-segmentation can be gathered using secondary and/or syndicated market research sources.
The second type of international market segmentation usually follows as the logical narrowing of established macro-segments. With micro-segmentation, companies choose to establish groups of consumers based on specific customer characteristics within the persistent country ones. In this way, consumer attitudes, consumption patterns, lifestyle choices, and other behavioral, demographic, and psychographic variables become the basis for international market segmentation.
A final type of international market segmentation combines macro- and micro-segmentation, but rather than separating consumers into groups based on their differences within countries, this unique type of international market segmentation focuses on similarities across groups and countries so that shared characteristics across the globe can be identified and used for marketing advantage. For example, consider the “Global Elite” and “Global Teens,” global market segments which are each universally recognized as incorporating a consumer persona with specific characteristics regardless of their geographic domain.
International market segmentation is neither straightforward nor intuitive. It depends on a complex understanding of a company’s brand and reach, as well as the drivers of unique global markets. Thus, to bolster your marketing creativity, it makes sense to partner with an experienced market research firm. Our team at Research for America, for instance, has decades of experience with dozens of industries around the world. We know how to segment global markets so that our clients garner the insights they need to make profitable businesses decisions. Please contact us to learn more about using international market segmentation to magnify your market research results.