Estimating duration of market segmentation process

[LateForBusiness]

I have been creating a Gantt chart to plan out a project and I feel like a market segmentation process should precede the specification of the MVP. However, I have never done (or had done) a thorough market segmentation process and am not sure how much time I should allocate for it on the chart.

I realise this may be a "how long is a piece of string" question but [TL;DR] please does anyone have a rough idea of how much time I should allocate for market segmentation?

The product is a kind of unique digital advertising platform that will be integrated into an existing web app. The potential customers range from sole-traders to large national business.

 

[LateForBusiness]

Hmm, now reading about the mixed success of segmentation as an approach in B2B markets.

 

[AstEver]

How are you going to segment the market? What is the process going to be? Are you going to conduct market research - using what methodology and tools?

If you map the process you should be able to estimate the time required for each step (the same way as you create the plan for the project, I think).

Did you develop the platform and now you are looking to market it or did you develop the platform based on some research?

 

[LateForBusiness]

How are you going to segment the market? What is the process going to be? Are you going to conduct market research - using what methodology and tools?

If you map the process you should be able to estimate the time required for each step (the same way as you create the plan for the project, I think).

Thanks for your input -- I think you are right. I just skimmed through a book chapter about B2B Market Segmentation and it seems like before I can even map the process I am going to have to allocate some time to answering questions like the ones you posted above. Something that sounds like it might take me at least five days of hard research.

Did you develop the platform and now you are looking to market it or did you develop the platform based on some research?

So the source of eyeballs (a web app) has already been developed and there are different routes to monetisation with the integration of advertising being the most attractive one to me at this time. The features to enable businesses to purchase and manage adverts -- the sum of which constitute the advertising platform MVP -- are not yet developed; I would like those developments to be informed by research

 

[fisicx]

Why would anyone use your app (or advertise on your app) when there are already thousands to choose from?

 

[LateForBusiness]

Why would anyone use your app (or advertise on your app) when there are already thousands to choose from?

My platform will offer a couple of unique value propositions:

1. Targeted exposure to potential customers earlier than would otherwise be possible
2. A way of growing brand trust in a serendipitous manner that is not otherwise available

Also, day-to-day business users of the app should fall into one of my segments so hopefully the familiarity of my brand will make it less of a hard sell.

 

[fisicx]

Nothing there that almost everyone else can’t equally claim. All the questions you are asking here should have been done long before the first line of code was written. For example, the structure of the app will depend on the market segment you are targeting. The words will depend on the social demographics. The value proposition will depend on the target advertiser.

 

[AstEver]

Some develop products as solutions to problems or needs identified from market research findings. For others, a product is an outcome of R&D and innovation process and there is a need to find a way to market it.

 

[The Byre]

Something tells me that you are too fond of jargon -

Gantt chart
market segmentation process
specification of the MVP
unique digital advertising platform
source of eyeballs
routes to monetisation
advertising platform MVP

If you translate those phrases into English, you may just -

1. Begin to start to see more clearly the range of tasks you still have to do.

2. Realise that the following statement is deeply flawed -

I am going to have to allocate some time to answering questions like the ones you posted above. Something that sounds like it might take me at least five days of hard research.

The last time I did any solid and meaningful market research into market segments and breaking down potential customers (that's eyeballs in your world) into geographic, demographic and psychological groups, it took several months and a team of five.

 

[LateForBusiness]

Nothing there that almost everyone else can’t equally claim. All the questions you are asking here should have been done long before the first line of code was written. For example, the structure of the app will depend on the market segment you are targeting. The words will depend on the social demographics. The value proposition will depend on the target advertiser.

I appreciate the help but it sounds a bit like I haven't explained myself properly. I only asked one question and that was about approximating the time to do a market segmentation process. I have had numerous people scrutinise the project in its current state and direction (grant providers, business analysts, other people in my sector, etc.). Doing that again here would be redundant so I would prefer not to drift off topic.

Something tells me that you are too fond of jargon -

Ha, I am not fond of jargon, you would not hear me talk about "blue skying a new synergy". Let me help:

URLs need to be prefixed with en [dot] wikipedia [dot] org:

Gantt chart - /wiki/Gantt_chart
market segmentation process - a process of /wiki/Market_segmentation
specification of the MVP - /wiki/Minimum_viable_product
[kind of] unique digital advertising platform -

• "kind of unique": because I was trying [clearly in vain] to discourage the thread spiralling off into some sort of armchair analysis of the extent to which I am wasting my time because competitors already exist.
• "digital advertising": /wiki/Online_advertising
• "platform": /wiki/Platform_economy#The_platform_business_model

source of eyeballs - "eyeballs" simply refers to the users targeted by the advertisers... it's not uncommon to hear in discussions about digital advertising, probably because "users" is ambiguous and "the users targeted by the advertisers" is verbose. "potential customers" gets confusing because it's a platform so I would be talking both about my potential customers and my potential customers' potential customers.
routes to monetisation - /wiki/Monetization#Revenue_from_business_operations there are different ways [routes] I can get there
advertising platform MVP - hopefully if you read the above links this will no longer sound like jargon to you

What is your background out of interest?

The last time I did any solid and meaningful market research into market segments and breaking down potential customers (that's eyeballs in your world) into geographic, demographic and psychological groups, it took several months and a team of five.

Thanks for the answer. By the sounds of it I am guessing that was B2C [retail ;P]?

Edit: and, oh, I was saying 5 days of hard research of all the processes potentially required to do the segmentation process, not to do the segmentation process itself.

 

[ethical PR]

If you look at some of the thousands of posts The Brye has made @LateForBusiness you will see what his background is. He is a man of many talents and a fine writing style

And you are right asking about how long market segmentation takes is like asking how long is a piece a string.

What do you actually mean by segmentation?

Do you simply mean understanding your target audiences are, or do you mean understanding who your target audiences are and what communications channels and consumer behaviour they have and what messaging and calls to action they respond do, so you can tailor your marketing to those who you know are most likely to be interested in your product ????

You can't just pluck a figure of 'five days' out of the sky. What knowledge did you base this on? From what you have posted I can't see how you have the skills to do this, so why not commission a suitably experienced marketing/market research to do this for you.

 

[fisicx]

I have had numerous people scrutinise the project in its current state and direction (grant providers, business analysts, other people in my sector, etc.). Doing that again here would be redundant so I would prefer not to drift off topic.

If this is the case then I do wonder why this question has only just come up? It only makes sense to do the analysis before a single line of code has been written.

What will you do after your market segmentation analysis only to discover the app needs a major rework?

 

[The Byre]

He is a man of many talents and a fine writing style

Wow! I mean - holy socks Batman! That's praise indeed.

The trouble with that sort of thing is that people who have either read what I have written or spoken to me on the telephone and then go on to meet me, tend to be very disappointed! Those who speak to me on the telephone expect to meet a sort of vapid, open-mouthed, idiotic buffoon in his early twenties. The sort of chap where you would say "Likeable in his special way, but a bit weak in the head."

Those who read my stuff expect some sort of sophisticated Oscar Wilde character of immense charm and ready wit with a thousand racy stories with which to spice up the evening. Well-groomed and well-dressed, charming and seductive is what they expect.

What they get is a tall rambling, scruffy old fool with a bald head who spends all his time laughing at his own jokes. It is for that reason that I spend my days locked away in my office* and away from public gaze. I feel that it is better all round and for all concerned! It avoids disappointment.

What is your background out of interest?

I'll tell you tomorrow if my advanced years and love of beer allows me to remember. Something to do with markets, mayhem and media and rock-and-roll, hip-hop and rap. I also managed a chicken farm for a while. When you have a CV like that, the world is your oyster!

*I come out at midday, foraging for food.

 

[AstEver]

The product is a kind of unique digital advertising platform that will be integrated into an existing web app. The potential customers range from sole-traders to large national business.

I don't know what the web app is so the below may not be useful.

For your customers, you may want to use the Abell's framework with some modifications (the axes/criteria can, and often should, be changed). If you segment your users too, they can be one of the criterion.

 

[LateForBusiness]

If you look at some of the thousands of posts The Brye has made @LateForBusiness you will see what his background is. He is a man of many talents and a fine writing style

And you are right asking about how long market segmentation takes is like asking how long is a piece a string.

What do you actually mean by segmentation?

Do you simply mean understanding your target audiences are, or do you mean understanding who your target audiences are and what communications channels and consumer behaviour they have and what messaging and calls to action they respond do, so you can tailor your marketing to those who you know are most likely to be interested in your product ????

You can't just pluck a figure of 'five days' out of the sky. What knowledge did you base this on? From what you have posted I can't see how you have the skills to do this, so why not commission a suitably experienced marketing/market research to do this for you.

• I would think it presumptuous to read a few of someone's posts and assume I can extrapolate their whole background from it.
• By segmentation I mean identifying similar groups of customers, grouping them into segments, selecting which segment(s) offer the best value and then, yes, formulating a positioning/marketing strategy based on the selected segment(s)
  
• I thought I clarified already I said a minimum of five days to learn about things involved and gather information required to get some sort of estimate of the length of the process.
• If a minimum of five days to figure out what the process is going to be seems incredulous to you what would you suggest the minimum to be? 2 years to get an MBA? 1 years experience in a market research company?
• Did it not occur to you that if I could afford to commission I would just ask the supplier for a time estimate instead of posting this thread? If, after establishing what is required for the process, it seems like I will need to acquire a bunch of skills in order to do it myself I will consider my options. If you wish to accelerate that process by telling me specifically what skills you believe I am lacking I would appreciate that help.

If this is the case then I do wonder why this question has only just come up? It only makes sense to do the analysis before a single line of code has been written.

What will you do after your market segmentation analysis only to discover the app needs a major rework?

Think of the app as a jumping off point; there are several distinct ways to generate revenue from it -- or the data behind it -- so I was comfortable with the risk of doing the development up front. It is disruptive [TheByre, forgive the jargon] and innovative enough that those who looked at it could see the value.

If it the app needed a major rework (not likely as the advertising platform would integrate quite seamlessly) I wouldn't do it, I have a partnership offer waiting based on the data alone.

There are other plays available to me as well but I would ask you take my word for it.

Something to do with markets, mayhem and media and rock-and-roll, hip-hop and rap. I also managed a chicken farm for a while. When you have a CV like that, the world is your oyster!

Sounds curious, thanks Sounds like we may operate in different worlds.

I don't know what the web app is so the below may not be useful.

For your customers, you may want to use the Abell's framework with some modifications (the axes/criteria can, and often should, be changed). If you segment your users too, they can be one of the criterion.

Thank you, I will look into it.

 

[Nochexman]

• By segmentation I mean identifying similar groups of customers, grouping them into segments, selecting which segment(s) offer the best value and then, yes, formulating a positioning/marketing strategy based on the selected segment(s)
• I thought I clarified already I said a minimum of five days to learn about things involved and gather information required to get some sort of estimate of the length of the process.

You've actually answered your own question here. You've identified the tasks you need to go through and you've budgeted yourself five days in which to do it. By creating a time limit you are creating a limit on the quality of the information you will derive; each of the segmentation tasks you have identified could take five days of work alone, or you could just do the whole thing in a few hours.

The question I would ask is what value would you ascribe to the information you derive from ticking the box marked segmentation? If you are doing this exercise in order to generate funding or to bring a partner in then in five days I could write something that sounds like I know what I am talking about. But, if your segmentation is a key driver in the success of your product then you might want to consider allocating more time or a larger budget.

Hope this helps!

 

[LateForBusiness]

You've actually answered your own question here. You've identified the tasks you need to go through and you've budgeted yourself five days in which to do it. By creating a time limit you are creating a limit on the quality of the information you will derive; each of the segmentation tasks you have identified could take five days of work alone, or you could just do the whole thing in a few hours.

The question I would ask is what value would you ascribe to the information you derive from ticking the box marked segmentation? If you are doing this exercise in order to generate funding or to bring a partner in then in five days I could write something that sounds like I know what I am talking about. But, if your segmentation is a key driver in the success of your product then you might want to consider allocating more time or a larger budget.

Hope this helps!

Thank you for the reply To avoid confusion, I meant a minimum of five days to gain enough knowledge to estimate the duration of the process, not to do the market segmentation process itself. E.g. five days is the for the meta-process, not the process.

The question I would ask is what value would you ascribe to the information you derive from ticking the box marked segmentation?

Thank you, that is a important point and one I plan to answer at the outset before I start gathering [or not] customer data. The value would be a function of the time/money put into the process and the perceived benefits but as I haven't done the entire process before my only means of estimating the time (thus determining the value) is learning more about the particulars of the process or asking other people who have done it about their experiences.

I was hoping people here would be able to say something like "we created a product for businesses which does X and it took us Y hours of labour to do the market segmentation" so I would be able to go from a state of having no point of reference of my own to having some vague points of reference from other people. Not to worry, I will simply do more reading about the activities involved, come up with a rough time estimate, allocate the time and, after beginning the process, refine my estimate as I go, and abort the process if need be.