Should my Segmentation be Global or Localized?
By Chuck Murphy & Maggie Bright

A well done segmentation is often the most powerful tool in a research arsenal. It helps humanize a customer base, optimize marketing efforts, create a common lexicon across organizations, and prioritize targeting and growth opportunities.

As US based commerce and technology expands across new borders, it is paramount that the decision to develop a locally or globally driven segmentation approach is carefully explored.

The Case for Global:

From an efficiency perspective, the idea of a well-planned global segmentation is appealing. It creates one framework from which the entire organization can innovate, create, distribute, and market its offerings. It realizes the limitations an organization may have in developing unique offerings or messages to each region and focuses on the macro environment in which a company operates. This unified strategy can often create a strong brand identity which serves as a powerful equity among consumers. A global segmentation can work well for companies that operate in markets with homogeny across factors which drive strategic decisions such as accessibility, category/brand familiarity, consumer need states, usage occasions, and demographics.

Should my Segmentation be Global or Localized?

The Case for Local:

A local segmentation takes into consideration the unique playing field of each region in which a company operates. It realizes that developed, developing, and underdeveloped markets may have different needs and customer bases, and it allows the segment solution room to incorporate these variations. A local segment solution has the benefit of being well attuned to regional needs and can show extreme sensitivity to market needs which often promotes strong brand loyalty among that market. It is most appropriate when the inputs into strategic decisions are driven by heterogeneous needs across markets or markets that are fundamentally different.

Should my Segmentation be Global or Localized?

The Case for Glocal:

It is also important to remember that local and global approaches do not need to be mutually exclusive. The development of an overarching segmentation which has local variations can often create a dynamic approach which highlights commonalities across markets while recognizing their differences. The drawback to this “panacea” approach is often the investment required to bring it to fruition. It requires alignment from stakeholders, budget and the time required to guide the hybrid approach to completion.

Where do you stand? Global, Local, or Glocal? Comment below!

We love talking about segmentations. Take a look at some of our previous thoughts on the topic, and please get in touch with us if you want to chat more about our experiences or your questions!

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2 responses to “Should my Segmentation be Global or Localized?”

  1. I dealt with this same issue while I was doing a project in school. This project involved introducing an American healthcare company to a new market. In each of the markets we looked at, the results were the same, people want to be healthy. Since we identified a common need amongst the different countries we surmised that by global segmentation would work in this instance.

    On the other hand, when we looked deeper into the issue, what is considered healthy differs greatly from country to country. In the US, because people are aware of the risks associated with obesity, thin is generally considered healthy. However, in South Africa, due to the high rate of HIV infection, a thin figure is often mistaken for someone who suffers from the illness. This and other influences do no prevent the implementation of a global model but it does highlight the need for local adaptation. That being said I believe glocal segmentation is the best.

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