How to Use Market Segments and Geospatial Data for Business Success

January 23, 2023
Written by Barnana Sarkar

Segmenting markets using geospatial data to target specific demographics in specific locations.

Source: Echo Analytics Internal Source. Created on January 23, 2023

You are a business owner, always on the lookout for ways to grow and succeed. One strategy that can help you reach new heights is to segment your market and target specific groups of customers. But where do you start? And how can you use data to inform your decision-making?

Enter geospatial data.

By using geospatial data – information tied to a specific location – you can gain valuable insights into the demographics, preferences, and behaviors of different market segments. This information can help you tailor your marketing efforts and make informed decisions about where to open new locations, what products to stock, and more.

But first, let’s define what we mean by market segments.

Market segments are groups of consumers who have similar needs, characteristics, or behaviors. Marketing professionals often segment their target market into smaller groups in order to better understand and serve their customers. Segmentation allows companies to tailor their marketing efforts and create more personalized and effective campaigns.

There are many ways to segment a market, including demographics (age, gender, income, education level, etc.), geographic location, lifestyle, or interests. For example, a clothing company might segment its market by age and gender, targeting different styles and marketing messages to younger women, middle-aged men, and so on.

Benefits of using market segments and geospatial data

There are several benefits to using market segments and geospatial data in marketing efforts:

Improved targeting: By segmenting their market and using geospatial data, companies can more effectively target their marketing efforts to the right audience. This can lead to higher conversion rates and more successful campaigns, resulting in higher ROI. For example, if a company sells a product that is popular with young families, they can use market segmentation to target their marketing efforts to areas with a high concentration of families with young children. Similarly, if a company sells a product that is only available in certain geographic locations, they can use geospatial data to target their marketing efforts to those specific areas.
Increased personalization: By using geospatial data to create personalized marketing campaigns, companies can make their messaging more relevant and engaging to their target audience. For example, a company might use geospatial data to send customized email campaigns to customers in different parts of the country, with different offers and messaging based on the local weather and other factors. This level of personalization can help build customer loyalty and improve brand reputation.
Better understanding of customers: By analyzing customer behavior and segmenting their market, companies can gain a deeper understanding of their customers’ needs and preferences. This can help them better serve their customers and make more informed business decisions. For example, a company might use geospatial data to see that their product is particularly popular with customers in a certain geographic location, and then focus their marketing efforts on expanding their reach in that area.

But how exactly do you go about using geospatial data to segment your market and conquer new opportunities?

Here are three steps to get you started:

– Identify your target market segments

Before you can begin using geospatial data to segment your market, you need to know who you’re targeting. This might involve identifying specific age groups, income levels, or interests. You can use market research, customer surveys, and other data sources to gather this information.

– Building a Stronger Audience

By collecting and analyzing geospatial data, companies can gain valuable insights into their target market segments. Utilizing tools such as GIS, mapping software, and online databases, companies can gather data on key demographics such as population density, median income, education levels, and more. This information allows companies to make informed decisions about where to focus their marketing efforts, helping to build a stronger and more engaged audience.

– Use the insights to inform your strategy

With your geospatial data in hand, it’s time to put it to work. Look for patterns and trends that can help you understand where your target market segments are located and what they’re interested in. For example, if you’re targeting young professionals, you might find that they are more likely to live in urban areas with high concentrations of coffee shops and co-working spaces. You can use this information to inform your marketing efforts and make decisions about where to open new locations or what products to stock.

Our takeaway

Using market segments and geospatial data can help companies improve their targeting, increase personalization, and gain a better understanding of their customers. This can lead to more successful marketing campaigns and help companies better serve their target audience.