•Each customer segment has a unique set of
needs and requires its own value proposition
•The profit potential differs by customer segment
Customer segmentation helps companies focus scarce resources where they can be most leveraged
Purpose: reduction opportunities
Tools:
• To identify
• To achieve
revenue and
differentiation
profit maximizing
and to preempt
strategies
competitors’
moves
• Customer Segmentation
Customer Segmentation
Customer segmentation is an important tool for customer analysis.
Context
Cost
Customers
Competitors
Capabilities
Strategic • To identify cost
•An international cosmetics company wanted to identify
opportunities in the high growth skin care market. A Bain team identified unmet consumer needs for anti-aging creams and proposed an optimal strategy for targeting the appropriate customers. This resulted in approximately $145MM in value creation.