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Occasion-Based Segmentation: A Powerful Way to Understand Your Market

Some people start their workday commute with a strong cup of black coffee. But on days they work from home, perhaps a Chai latte seems more appealing. And in the evenings, unwinding with Chamomile tea may be a relaxing bedtime ritual.

As a marketer, it’s important to know these kinds of things about your target customer and to probe deeper to find out:

  • What motivates their choices?
  • Would their choices change in the company of a friend or family member? (Perhaps hot chocolate on wintry Sunday afternoons is a tradition with their kids)
  • And, most importantly, how can you use that information to effectively reach current and untapped consumers?

So what’s the occasion?

A major distilled spirits company wanted to know what influenced consumers’ choice of alcoholic beverages. Historically, they‘d viewed their market by demographic criteria (e.g. Urban Caucasian males aged 21 to 25).

Unfortunately, this didn’t give them useful insights about how groups of consumers actually behaved or when and why one drink was chosen over another.

To really understand the dynamics of beverage selection, we segmented their market by usage occasion. In other words, when consuming a particular drink…

  • where are consumers?
  • who are they with?
  • what are they doing?

Digging into the research data showed that people made very different drink choices when on a date versus going to a girls’ night at a local club versus meeting friends at the local bar. By understanding the environment the consumer was in, we could start to understand why and whether someone chose a vodka martini or a beer.

Segmenting your market by usage occasion is an often overlooked but potentially powerful source of insight about the market. It allows you to better engage with consumers by tailoring your message and media choices to each occasion.

On a more strategic level, it helps you decide which usage occasions are most sensible and lucrative to try to capture.

Continue to discover more tactics to effectively reach your target customers. Check back soon for one more installment of this series. More great tips to come.


About the Author

At Erickson Research, a Chicago market research consulting firm, I specialize in probing the minds of consumers and professionals -- revealing what truly matters to them...and why. Find me on LinkedIn.

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