Thanks to the wealth of consumer data-gathering tools, audience segmentation is rapidly becoming more sophisticated and varied in its application. Audience segmentation, historically used for better-targeted advertising, is now central to dozens of product categories across a wide array of verticals, affecting bottom lines and driving revenue.
FinTech: Moving dollars through segmentation
For FinTech, the ability to segment data to find audiences with unmet needs has been a driving factor in its competition with legacy banks. These days, for example, many FinTech players are targeting millennials, small businesses and the underbanked due to their cost savviness and openness to remote delivery.
But FinTech is also using big data and advanced analytics to predict actions, understand customer needs and deliver financial services via new channels ranging from mobile phones to wearables, says a December McKinsey & Co. report. An example is a new credit-scoring system based on unusual metrics like college attended, college major and social network data. Other FinTech functions slated to benefit further from segmentation include credit provision, customer acquisition, customer servicing, relationship deepening through cross-selling, and customer retention and loyalty, McKinsey says.
“The most successful FinTech attackers … will cherry pick, with discipline and focus, those customer segments most likely to be receptive to what they offer,” the report predicts.
AdTech and MarTech: New & Unique face of segmentation
- Advertisers are adapting to patterns in multiple digital device use, for example creating coordinated ad campaigns for those who watch TV and access tablets simultaneously.
- As artificial intelligence develops more broadly, some predict advertisers will impart their messages via personal robots that respond and react in real time, providing customized experiences and information.
- Marketers are moving past traditional demographics to psychographics, predicting behavior based on passions, interests, attitudes, values and personality traits having an immediate impact on sales.
- Retailers are gaining a better understanding of audiences via neuromarketing research, which studies consumers’ sensorimotor, cognitive and affective response to marketing stimuli.
- Marketers are implementing data gathered via emotional research tools such as facial recognition software, including a product called Affdex that can correlate facial movement with emotional and cognitive states.
- MarTech is increasingly using tools applied to social media to extrapolate personality traits in predicting consumer behavior.
- Retailers are getting 360-degree views of consumers’ lives thanks to the burgeoning Internet of Things (IoT), which allows for real-time data integration between computers, mobile devices, wearable technology, security systems, thermostats, cars, electronic appliances, light systems, alarm clocks, speaker systems, vending machines and more.
Eventually, forecasters say, the nearly unlimited data will be applied to other facets of our daily lives. Author Erik Brynjolfsson predicts metrics will someday be used to infer personal information like a person’s political persuasion or history of drug use. “There is a huge opportunity for efficiency gains,” Brynjolfsson notes. “But there will be side effects from taking out all the opacity around how things last and behave.”
The issues around corporate data responsibility and security need to be to of mind for all of our innovators and trailblazers as progress in this realm moves quickly, providing tangible advances in business efficiency and customer experience.