Michael Fassnacht, in an article published by Advertising Age (April 13) entitled, "The Death of Consumer Segmentation," put on a full frontal assault challenging the use of geodemographics and marketing segmentation, and by association business GIS. He references a "well-known fashion retailer" (but doesn’t name names) that supposedly spent big bucks on, what I assume, was a desktop mapping system replete with demographics and psychographic data. He makes the following points:
- "The rather static definition of consumer segments is becoming less reliable in our extremely volatile society, especially in today’s economic climate. A consumer’s lifetime value may have decreased significantly in the past six months, a fact not reflected by any segmentation method."
- "Consumers are never just part of one segment. Rather, they feel, rightfully, that they belong to a multitude of segments. They can be the professional executive in the morning, the boyish sports fan in the evening, the churchgoing father figure on Sunday."
- "Consumers are gaining more control of any marketing activity…they like to receive relevant information, but even more, they prefer to choose their own relevant information"
He goes on to reference Apple and Amazon that don’t bet the farm on market segmentation. "[They] are not masters of consumer segmentation but experts in building relevant products that consumers choose. Their marketing communication is segment-based but does not depend on pursuing an ever-increasing level of micro-segment-specific relevance. They are far more focused on building and communicating relevance relationships than in micro-segmenting consumers."
So, Fassnacht appears to be arguing, not to abandon micro-marketing, but to say that much finer market segmentation may be necessary, and, as he describers, consumers engage in "self-segmentation." I would argue that in our mobile society we are much more geographically disperse and at any given time will be or should be marketed to in both a geospatial and time-relevant context. Hence the boom in location-based advertising. What we as marketers need is a better way of capturing the geographic dispersion of the marketing and the means to target appropriate messages.