Gorillas and gazelles: GNC lacks muscle behind segmentation strategy

By Kevin Byrne

I’m not a bodybuilder. At 6’3” and 175 pounds, I’m more gazelle than gorilla. My workouts involve runs along Lake Michigan more often than bench presses at the gym. However, while in the midst of marathon training, I do rely on protein shakes and amino acid powders to help with endurance and recovery.

The trouble is that GNC (General Nutrition Centers) doesn’t seem to understand the difference between the muscle heads and me. They know I’m a customer but they don’t try to determine why. They don’t seem to know what to do with me.

The online experience with the brand is the worst. I receive daily emails touting the latest and greatest in the world of vitamins and supplements designed to inflate me to Incredible Hulk proportions. Meanwhile, the Yahoo Mail banner ads, in a feeble attempt to be targeted, show more of the same. Along with the online confusion, the retail stores offer little guidance as to where different types of customers might find their preferred products.

GNC has the information; that’s the frustrating part. They offer a loyalty card and track online and offline purchases. The data is there, they just need to use it. With a little analysis, distinct groups would most likely start to emerge: the organic, yoga-types with their homeopathic remedies, the dieters looking for the newest fads in weight-loss, and maybe even the lean, mean marathoners.

By defining better segments, GNC could target their consumers with more efficiency and grace. They may even choose to use overlay demographics or at least ask a few questions about users’ interests and goals. Current customers would feel more included and be better informed of products designed to help them achieve their objectives. As word of this new approach spreads, GNC’s image may evolve to be more inclusive of individuals who might currently feel out of place at this type of store.

It’s all about segments. You’ve got to separate the gazelles from the gorillas and market accordingly. All customers are not the same, so don’t treat them that way.

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Kevin Byrne is a graduate student in Integrated Marketing Communications at Northwestern University's Medill School. He enjoys his constant carbo-loading while he trains for his fourth marathon. He can reached at KevinByrne2010@u.northwestern.edu.

McSegments

By Alejandra Leon

When Ray Kroc took over a restaurant business from the McDonald brothers, he realized that kids were his target market.

No sooner had Kroc acquired the company than Ronald McDonald the clown was brought in to attract children to his restaurants. His insight would result in the creation of a billion dollar empire.

Kroc’s genius is that he understood his audience and identified the two main segments that would drive his business: working- and middle-class children and their parents.

The company has come a long way since the days of Ray Kroc. The global fast food giant has grown immensely over the decades thanks in part to its unique targeting ability and innovative implementation tactics.

An example of this was the launch in 1979 of Happy Meal in the United States. The meal-plus-toy packaging was an instant hit that became an American icon and still accounts for a large percentage of all McDonald’s meals sold today.

Following an IMC approach, McDonald's has gotten to know its customers and has built its advertising strategy around it. The company knows that by targeting families, it’s tapping into one of the most attractive consumer groups. As marketing and brand strategist Martin Lindstrom states: “It gets into the parents' wallets via the kids' minds.”

Though very effective, McSegmentation has become the focus of controversy regarding the company’s targeting efforts. The fact that children play such an important role in the purchasing decision has raised many questions concerning the ethical repercussions and regulations of targeting and advertising to children.

There are several reasons why McDonald’s is the number one fast food restaurant in the world, and as stated above, a very important one has been its ability to understand its customers, segment them and reach the heart of its targets. Whether the company should or shouldn’t be allowed to continue pursuing children is still up for debate.

Should children be the main consumer target for companies?

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Alejandra Leon is a blogger at Vitamin IMC and a student in the Masters in Integrated Marketing Communications program at Northwestern University's Medill School. She isn't ashamed to admit that she finds comfort in a McNuggets meal to brighten a hard day. Alejandra can be reached at alejandraleon2010@u.northwestern.edu.

A 30-second spot, in 30 seconds or less

By Megan O'Malley

A new ad creation interface from Visible World is breathing new life into the good ol’ 30-second spot.

Not only can clients use the resource to create ads from a selection of scenes and content in a matter of seconds, they can also instantly adjust the advertisement to fit each select individual, demographic or geographic target of television viewers.

TV advertising traditionally meant targeting audiences by assuming groups of similar consumers watched certain types of programming. With new ad customization tools, companies can adjust ads based even on live programming events.

Marketing implications? Television can now be used to target segments just like direct mail.

Take Wendy’s, which surprised viewers of an NFL football game by featuring animated raccoons whose dialogue mirrored events in the game right before commercial break.

Subaru is also taking advantage of the condition-based advertising by setting ads for vehicles in weather conditions that mirror the weather of the day in certain regions.

Customized TV advertising generation could reinvent media placement. TV as an advertising channel has drawn recent skepticism from marketers caught on a digital buzz. However, TV remains the highest used media in America by minutes used per day and television advertising still makes up a vast majority of most marketing budgets.

Jerry Dow, Medill IMC alum and Chief Marketing and Sales Officer of Suddenlink, offered insight on the importance of understanding the new with the old.

“Students with an understanding of targeting, segmentation and integration of new and old tools are going to be infinitely more valuable to take advantage of today’s customization trend. IMC students are especially needed to help those stuck in the traditional ways to understand this shift in television advertising,” he said.

The automation of television advertising presents challenges to the traditional creative process in that it requires storylines that are adaptable to varied target audiences. Although quick customization tools are no substitute for the creation of exceptional ideas and creative content, they do serve as powerful tools for creating targeted ads on the fly. Such tools allow creative marketers to quickly speak in a more engaging way to each and every consumer.

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Megan O’Malley is a graduate student in Integrated Marketing Communications at Northwestern University's Medill School. She misses the good ol' days of Saved By the Bell and Daria on television. She can reached at MeganOMalley2010@u.northwestern.edu.

Allowing customers to self-segment can provide lasting value for companies

By Ashley Graves

DraftFCB CMO Michael Fassnact said in his Ad Age editorial, "The Death of Consumer Segmentation," earlier this month that the traditional way of segmenting customers is most likely dying, or at least becoming less useful.

Segmentation is still important to the analysis of huge customer databases, but it is what to do with the segmentation schemes that should be looked at differently. As Fassnact argues, marketers can’t simply segment customers and then leave them in those segments for life. A company’s segmentation scheme should allow for customers to migrate between segments in order to maximize their lifetime value to the business. Self-selection into segments is even better.

Many companies are doing a fantastic job at self-segmentation-ahem, Amazon.com, anyone? This idea of having customers initially segment themselves allows for more targeted messages, and also allows customers to move to a different segment based on a variety of events.

Let’s take swimsuit shopping as an example. For many women, including me, shopping for a swimsuit is a dreaded yearly event. You generally are far from being tan and forget that certain swimsuit cuts look awful until you put them on. Wouldn't it be great to skip the trial-and-error step?

Many retailers are doing a fairly good job of letting customers self-segment online when shopping for swimsuits. Both Macy’s and Nordstrom have “Swimsuit finder” sections in their websites that allow for customers to sort and view swimsuits that are flattering to their self-selected body type. If I’m pear-shaped, I’m directed towards different styles than if I were hourglass-shaped.

This concept of dressing to your body type is fairly common within fashion, but there is a big opportunity for retailers to better apply this idea to segmenting their customers. Macys.com also allows you to shop for dresses by body type, but it is difficult to find. You have to choose your shape again instead of having the site carry over your selection from swimsuit shopping.

Why can’t retailers like Macy’s save your self-segmented preferences in order to provide an entirely new level of personalized shopping? If customers could provide information in their profiles about things like body type, retailers like Macy’s could provide clothing recommendations in any department.

Self-segmentation strategies could provide consumers with more relevant, targeted and effective communications, thus increasing their value to the company over a longer period of time.

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Ashley Graves is the Editorial Director at Vitamin IMC and a student in the Masters in Integrated Marketing Communications program at Northwestern University’s Medill School. Swimsuit shopping stresses her out. She can be reached at ashleygraves2010@u.northwestern.edu.