Inbound Marketing: why is Chilean market segmentation falling short?

Those who work with a digital marketing strategy in Chile are familiar with the traditional socio-economic market segmentation (GSE). These categories have become so massive that they have gone past marketing and public policy instead of speaking in income quintiles or deciles. However, it falls short of what an Inbound Marketing strategy based on a buyer persona is all about. 

Although social and economic classification is still key to the industry, as it is a valuable reference tool for marketing and sales strategies, we consider it a narrow tool if we do not understand our customers' entire motivations and concerns. The problem is that this is a demographic profile instead of a psychological one.

"If Your Only Tool Is a Hammer Then Every Problem Looks Like a Nail"

Abraham Maslow

This demographic classification requires revision. In 2015, Criteria Research revised the categories, as it looked to “segment instead of classifying groups,” according to the company, in a study run in partnership with Universidad del Desarrollo. At the same time, the Chilean Marketing Researchers Association (Asociación de Investigadores de Marketing or AIM) made the same approach.

They updated these profiles and categorized in distinct manners middle and lower-income consumers:

 Source: designed by IDS Agency, based on AIM, Criteria Research and El Mercurio.  

"The socioeconomic groups work best as a general reference to people’s income levels, but they are not the input to create messages or brand positioning,” stated El Mercurio BBDO Chile’s Marisol Mora.

Agencies such as Young & Rubicam began creating a Cross-Cultural Consumer Characterization (4C), based on psychographic segmentation: lifestyles, personalities, social status, to know people from their motivations. It relies primarily on several needs, inspired by Abraham Maslow’s theories, Arnold Mitchell's lifestyles and Milton Rokeach’s Human values principles, and other authors.

The Reformer

Is a person of good status, socially conscious and proud of being tolerant. Looks to cross barriers with innovative, intelligent brands.

The Explorer

Looks to discover, and is the first to adopt new ideas, and is willing to invest in activities that make him feel different.

The Aspirer

Considered the easiest target for advertisements, is materialistic, ambitious and Consumer based, guided by peer pressure.

The Struggler

Doesn’t plan ahead, has trouble making projects and doesn’t have many resources, but wants to escape and rebel.

The Resigned

Located in lower economic groups, is respectful of organizations, institutions, loves security and intends to survive in life.

The Succeeder

Has a high self-esteem, goal based and organized. It is a cross-societal group, competitive and direct.

The Mainstream

Is the person who settles with routine and group decision

Although this study gives us interesting notions of the Chilean Consumer, it does not cover the range and magnitude of specific consumers' challenges. 

The Buyer Persona

HubSpot researched comparative marketing experiences and created buyer personas, a semi-fictional representation of the ideal customer, based on real information and demographic inferences from customers' behavior, motivations, and goals. The profile comes mainly through past customer analysis to enter the mind of future ones.

An Inbound Marketer does not care much about the actions, but the why of those actions, to understand goals and behaviors, which are very linked to the industry where you work.

The GSE is focused on demographics and buyer power instead of the person and their personal and professional interests and pain points.

Traditional marketing focuses on the product. For instance, what demographic reads this newspaper page?

Inbound Marketing is based on the customer, and they make the reverse question: what newspaper page do my clients read?

• What is your job role?
• Their title?
• What are they working to accomplish?
• What are their biggest challenges?
• How do they learn about new information for their role?
• Do you  use the internet to research vendors or products

Case: a SaaS shopper Buyer Persona

Let’s take the case of Jose Luis and Pedro.

José Luis is 33, and single. He used private health and studied Information Engineering at a private university. He commutes to work by car and likes to live in a condo outside the city. His credit profile gives him access to banking products, pays-per-view television, and a landline phone with a permanent housekeeper. He is an Explorer.

Pedro is 36 and is also single, but he uses public health insurance and studies Information Engineering at a public university after receiving a scholarship at his technical institute.  Even though he has money to buy a car, he likes to walk to work. His credit history is not good, so his access to banking products is restricted. He does not watch television and only uses a smartphone. He is the Succeeder.

Their demographics are slightly different. However, if they work at a Software as a Service Company, its buyer persona characterization would be identical:

• They both have to make shipping choices for the company.
• They must secure ROI
• They have the same level of income and studies.
• They are avid to try new gadgets, but they need boss approval.
• They are Millennials
• They are early adopters of information technology.
• They rather get information from Twitter and LinkedIn.
• They like news and innovation journals
• They move around innovation and developer groups

If we need to understand what drives our customers, ¿why are we only basing it on their demographics?

Let’s begin to understand them well and adapt our messages to them. 

That is how we will need better approach clients.

What do you think about the buyer persona? What additional information can give you, as opposed to only looking to the GSE? We want your comments and opinions.