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Segmentation drives Best Buy's strategy

News, 27 September 2016

NAPLES, FL: Best Buy, the electronics retailer, has successfully leveraged the results of in-depth segmentation research to inform both its marketing tactics and wider corporate strategy.

Greg Revelle, the organisation's Chief Marketing Officer, discussed this subject during a session held at the Association of National Advertisers' (ANA) 2016 Masters of Measurement Conference.

And he outlined the result of a six-month segmentation program which demonstrated that orientating its efforts around "high-touch tech fans" could help Best Buy in driving sales with its core and wider audiences alike.

"We discovered that if we could win that segment, we could win all of them," he said. (For more details of its strategy, read Warc's exclusive report: Best Buy underpins creative with analytics.)

Its main target, he continued, can be summed up as "highly engaged consumers who love technology. They seek the latest tech, especially emerging categories, and are omnichannel shoppers. They want high-touch service."

And even if this audience of demanding tech enthusiasts makes up a small share of the entire prospective audience, meeting their needs could allow Best Buy to serve any other group by delivering the same premium on performance.

"This was a crystalising moment for our company in terms of determining what it is that we needed to do to win at the marketplace," Revelle continued.

"The executive team … actually decided to change the company's mission – what we're all about, what we're trying to do, and what we're trying to accomplish … So, the mission of our company is changing because of math."

As Best Buy "looked into this high-touch tech fan group a little bit deeper", it learned their love of technology translates into a desire to show off their home, be the centre of attention, feel important and attain social status.

"They want to be cool. They want to know what way is the best. And the single most important thing that popped about our audience is that they want others to say, 'Wow!', when they see their technology," said Revelle.

"These are the guys that stand in line at Apple for a day to get the phone that then they can show off to their friends."

Data sourced from Warc