Academic journal article Multinational Business Review

Challenges to Modern Consumer Segmentation in a Changing World: The Need for a Second Step

Academic journal article Multinational Business Review

Challenges to Modern Consumer Segmentation in a Changing World: The Need for a Second Step

Article excerpt

We re-evaluate modern segmentation assumptions and methods by referencing several postmodern characteristics of consumers in global markets. Drawing on contributions from sociology, political sociology, social theory, anthropology, philosophy, psychology, consumer behavior, and international marketing, we posit three research questions, discussion of which leads to the formulation of research propositions. Real-life consumer and marketing examples are quoted as evidence of the need to go beyond reliance on modern segmentation to incorporate postmodern thinking into consumer analysis as a necessary 'second step.' This paper invites reflection on how marketers should adapt to new, complex, and changing consumer realities, which are summarized as multi-dimensionality, unpredictability, inconsistency, search for meaning, and peak experiences by means of consumption.

INTRODUCTION

Consider the following hypothetical case of two female consumers: one lives in a city in California, is a wife and mother of two children, belongs to the online community of Jeep owners, is pursuing a Master's degree by distance education, and owns property in the virtual world of "Second Life." The other woman lives in rural Kenya, is a widow with four children, holds a loan through a community micro-credit group, is trying to expand her livechicken business, and rents her home from a local farmer. At first sight, one might assume that these two consumers have little in common other than their gender and their role as mothers. From the point of view of current segmentation methods, a marketer might properly conclude that they belong to two entirely different consumer segments based on geography and socio-demographic criteria. How would these assumptions and conclusions change if the two women are further described as using cell phones on a regular basis and being deeply concerned about sustainable development in their local area?

In this paper, we address the challenges of consumer segmentation in a changing world, asking how effectively the current approaches to segmentation capture unexpected commonalities between consumers (such as the two women described above). Using current methods, marketers would most likely allocate each woman to one or more different segments based on geography, demographics, psychographics, or analysis of product benefits. In this study, we re-evaluate established thirücing about segmentation in light of postmodern thinking about consumers, markets, and marketing. Postmodern thinking challenges modern methods' reliance on the use of cross-sectional descriptive data to allocate consumers to predetermined static categories, otherwise known as market segments.

The importance of this topic arises from a recognition that characteristics and life experiences of consumers are changing rapidly. New technologies offer consumers many ways of learning, communicating, doing business, finding entertainment, and managing their lives. In this study, we question how well modern segmentation methods work in this environment. We argue that a different approach, informed by postmodern thinking, will reveal more similarities between consumers than might initially be expected. Further, we will show that individual consumers increasingly escape the categorizations typical of modern segmentation, calling into question the efficiency of these methods. A postmodern view of consumers and consumption promotes images of consumers as complex, multi-dimensional, and changing.

In this paper we confront modern (i.e., conventional) consumer segmentation methods with postmodern minking about consumers and their changing patterns of consumption. The general purpose of this study is to encourage a critical reassessment of modern market segmentation assumptions and methods in light of postmodern thirdöng about twenty-first century market conditions that shape consumer consumption. We do not advocate wholesale abandonment of modern segmentation - which would go against the grain of postmodern tolerance of multiple opinions. …

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