Geographic segmentation uses the location of the individual to personalize the marketing strategy. The method assumes that consumption behavior is instinctively guided by geographical criteria: depending on the place of residence, the consumer is not receptive to the same advertising messages or buys the same products and services. The company thinks “locally”, it projects itself to where the individual lives to understand their needs and thus address them effectively.
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Geographic segmentation is useful regardless of the scope of the company’s target market, whether or not the brand markets its offer online. From one location to another, the consumer reacts differently to the marketing efforts deployed by the company: the culture and traditions, the climate or the rate of urbanization specific to each area influence the behavior of its inhabitants. By dividing the audience into geographic segments, the company is able to adapt its marketing actions: its strategy gains in performance, costs are rationalized.
What is geographic segmentation?
Geographic segmentation consists of establishing consumer segments that share common characteristics directly related to their geographic location. After identifying the segments, the company implements a personalized marketing strategy with regard to these characteristics.
Geographic segmentation can be established at different scales, to benefit both the brand that sells internationally and the local retailer. For the DIY store located in a village, for example, the geographical segmentation can consist in dividing the customers at the scale of the districts. The city center has a majority of apartments, while the outskirts of the village are made up of houses with gardens. Based on this finding, the store launches a promotion on lawn mowers, and communicates it through an e-mail campaign addressed to the outlying population segment to specifically target homeowners. In a larger market, the e-commerce site can segment its customers by country. Each country has its own language and time zone: on this basis, the company creates an Instagram account for each country, to post its publications at an appropriate time and in an understandable language.
The criteria to take into account for a geographical segmentation
The location of the consumer is an easy piece of data to collect: this is why geographical segmentation is one of the most accessible methods for the company as part of its marketing segmentation strategy. To segment its customers on a geographical basis, the concept of location in the administrative sense of the term is not the only criterion to be taken into account. A company targeting France, Canada and Spain, for example, can segment its customers by country but also by language or time zone. It can also refine its segments by using more precise differentiating criteria such as local culture, or even make a multi-criteria segmentation by including demographic data of age and socio-professional category.
To choose the geographic segmentation criteria, the company must identify not only the relevant reference scale in its market, but also the remarkable specificities in the territory in which it operates. The events agency located in the Pyrénées-Atlantiques department, for example, targets a wide range of populations: from Pau to Bayonne, the impact of its communication actions is intended to vary according to local specificities. Pays-Basque and Béarn are territories strongly marked by distinct traditions. Likewise, the inhabitants are imbued with their natural environment: the ocean to the west and the mountains to the east. The event agency defines its segments on the basis of these geographical criteria, and adapts its marketing strategy: it communicates more about its ski holidays to schools in the south-east of the department, it adopts the red and white color code for the Bayonne to communicate in the Basque Country.
The criteria to take into account for a geographical segmentation are numerous and differ from one company to another.
Administrative division is the most obvious geographic segmentation criterion. Depending on the scope of its audience, the company segments its target at different scales:
- By neighborhood: geographical segmentation by neighborhood is relevant if the company identifies significant differences from one place to another in the targeted municipality, in terms of income, eating habits or type of housing. In Paris, for example, segmenting the population by arrondissements is relevant: the districts of Saint-Germain-des-Près and Marais are very touristy, while the 16th arrondissement is particularly residential.
- By city: from one city to another of the company’s target market, cultural differences are often marked. In Annecy and Lyon, for example, two cities that are geographically close, the population does not have the same daily life habits.
- By departments or by regions: segmenting the clientele by departments or by regions is useful when there are marked differences in terms of local traditions. In Brittany and Corsica, for example, the company uses distinct marketing arguments to seduce the consumer.
- By country, by language or by time zone: when the company markets its offer internationally, the country criterion is essential. It is important to take into account the language and the time zone, but also the demographic characteristics specific to the local populations. It should be noted that the company can use the only criteria of language or time zone to segment its customers, without taking into account the country.
Example of geographic segmentation by location
The sports equipment manufacturer distributes its products in stores and online to customers from Paris and the Paris region. The segmentation by cities and by neighborhoods is relevant. The inhabitants of Saint-Germain-en-Laye and those of the 16th arrondissement, near the Bois de Boulogne, have a natural setting for practicing outdoor sports activities: the equipment manufacturer communicates to their address about its range of bikes while -ground. The inhabitants of the central districts of the capital are constrained by the weather and do not have easy access to vast natural spaces: the equipment manufacturer focuses its communication on exercise bikes.
The climate and the natural environment
The climate, often linked to the natural environment, is a relevant geographical segmentation criterion when the weather influences the usefulness of the products and services marketed by the company. The division of the audience into segments is not based on the city of residence, the customer file is categorized by type of climate or natural environment.
- Geographical segments by type of climate: the company distinguishes customers living in a hot climate, customers living in a cold climate and customers living in a rainy climate. The company can also create a customer segment strongly marked by seasonality.
- Geographical segments by type of natural environment: the company distinguishes between the category of customers living on the coast, the category of customers living in the countryside and the category of customers living in the mountains.
Example of geographical segmentation by climate
The clothing brand sells its products online throughout France. Climate is a relevant geographic criterion for segmenting customers. The brand highlights its range of cashmere sweaters in its marketing newsletter addressed to the “cold climate” segment, and presents its new collection of shorts to the “hot climate” segment. The brand may prefer geographical segmentation by natural environment, to clearly focus its advertising content on swimwear or on technical ski clothing.
Culture and traditions
Geography is marked by cultural diversity, which the company can take into account to develop an effective marketing strategy. From one place to another in the world, the local population does not have the same eating habits, is not sensitive to the same arguments and is not educated in the same values. Among the main influencing factors:
- Religion: certain religions are massively represented in specific geographical areas. Religion influences the way of life, including diet and individual values.
- History: the history of a region or a country gives rise to traditions that endure and have a profound impact on the population. In France, regionalism marks deep-rooted traditions.
- Politics: the political powers in place in the geographical area have an impact on the way of life of the inhabitants. A town hall particularly committed to the ecological transition, for example, makes the town all the more aware of environmental issues: the company can take advantage of this in its communication.
Example of cultural geographic segmentation
McDonald’s corporate communications strategy is an evocative illustration of geographic segmentation by culture. If the restaurant offers similar food product lines from place to place, it adapts its advertisements according to local traditions:
- In India, because the cow is a sacred animal, chicken burgers are featured on advertising posters.
- In countries with a Jewish tradition, such as Israel, McDonald’s communicates on its kosher menus.
- In Muslim countries, the restaurant chain communicates about its halal products.
- For the opening of its restaurant in the Landes, McDonald’s brings in a banda, a local brass band, and offers berets to customers.
The level of urbanization and population density
The company can segment its market by urban, suburban and rural areas. This criterion is in fact a determining factor in consumer behaviour: needs and expectations differ from the capital of the country to the town in the countryside.
Example of geographical segmentation by level of urbanization
The carmaker markets its 4×4 range more favorably to residents of small country towns, who need all-terrain vehicles and do not experience heavy car traffic. On the contrary, the manufacturer isolates the segment of the inhabitants of the metropolises to highlight its city models and its electric vehicles.
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