No matter what age you are or what your fitness level is, physical activity is a key element of living a healthy life. Everyone desires to have an area where they can relax while working out. There is a chance to broaden the scope of services offered, instead of concentrating solely on one segment of society.
The fitness trade is immensely competitive, so you must keep ahead of the game and stand out from the rest. Give thought to the potential for enlarging your enterprise when you attract a more varied customer base.
An Introduction to Market Segmentation
Many clubs concentrate their attention on a single demographic. This approach may be successful for some exercise centers, but for others, it may fail to produce desired results over time. By using market division you can grow your fitness group and get new participants.
What is market segmentation?
The basic concept behind market segmentation is to divide the target audience into more manageable groups. Breaking a market down into smaller subsets based on characteristics like demographic information, preferences, needs, shared interests, and other psychographic or behavioral factors is known as market segmentation. This technique is used to gain insight into the target customer base.
Realizing the distinct groups that make up your target audience can be used to guide product, selling, and promotion tactics. Segmenting the market can provide a boost to your product creation cycles by helping you craft product choices that are designed to target distinct segments such as men or women, or individuals with high or low incomes.
To get more out of it, continue reading to learn the significance of segmentation for development and the types of segmentation in the market that can be employed to maximize the advantages for your business.
The Benefits of Market Segmentation
Companies that properly segment their market enjoy significant advantages. A survey by Bain & Company revealed that the majority (81%) of corporate leaders believe that segmentation is a fundamental factor in increasing profits. Research from Bain indicated that businesses that excel at market segmentation have a 10% higher rate of profit over a five-year time frame when compared to those which are not as refined in their segmenting.
Other benefits include:
- Stronger marketing messages: You no longer have to be generic and vague – you can speak directly to a specific group of people in ways they can relate to because you understand their characteristics, wants, and needs.
- Targeted digital advertising: Market segmentation helps you understand and define your audience’s characteristics, so you can direct your online marketing efforts to specific ages, locations, buying habits, interests, etc.
- Developing effective marketing strategies: Knowing your target audience gives you a head start about what methods, tactics, and solutions they will be most responsive to.
- Better response rates and lower acquisition costs: will result from creating your marketing communications both in ad messaging and advanced targeting on digital platforms like Facebook and Google using your segmentation.
- Attracting the right customers: targeted, clear, and direct messaging attracts the people you want to buy from you.
- Increasing brand loyalty: when customers feel understood, uniquely well-served, and trusting, they are more likely to stick with your brand.
- Differentiating your brand from the competition: More specific, personal messaging makes your brand stand out.
- Identifying niche markets: segmentation can uncover not only underserved markets but also new ways of serving existing markets – opportunities that can be used to grow your brand.
- Staying on message: As segmentation is so linear, it’s easy to stay on track with your marketing strategies, and not get distracted into less effective areas.
- Driving growth: You can encourage customers to buy from you again, or trade up from a lower-priced product or service.
- Enhanced profits: Different customers have different disposable incomes; prices can be set according to how much they are willing to spend. Knowing this can ensure you don’t oversell (or undersell) yourself.
- Product development: You’ll be able to design new products and services with the needs of your customers top of mind, and develop different products that cater to your different customer base areas.
The Basics of Segmentation in Marketing
Figuring out market segmentation depends upon comprehending the numerous techniques you can portion your crowd and different kinds of market division. There are four primary categories of segmentation, illustrated below.
|Demographic (B2C)||Firmographic (B2B)||Psychographic (B2B/B2C)||Behavioral (B2B/B2C)|
|Definition||Classification based on individual attributes||Classification based on company or organization attributes||Classification based on behaviors like product usage, technology laggards, etc.|
|Examples||Geography Gender Education Level Income Level||Industry Location Number of Employees Revenue||Lifestyle Personality Traits Values Opinions|
|Decision Criteria||You are a smaller business or you are running your first project||You are a smaller business or you are running your first project<||You want to target customers based on values or lifestyle<||You want to target customers based on purchase behaviors|
|Difficulty||Simpler||Simpler||More advanced||More advanced|
Types of Market Segmentation
Segmenting and targeting require that you comprehend how people in your market will react to a particular circumstance, like what motivates them to buy your products. For many surveys, a predictive model may be included to help categorize people into clusters according to specific replies to questions.
Segmenting a market based on demographic characteristics, such as age, educational level, household income, marital status, number of family members, race, gender, occupation, and nationality, is a way of categorizing consumers. Demographic segmentation is frequently applied to marketing as it is an uncomplicated way to parse out shoppers. It is based on differentiating variables such as age, sex, and income as they influence the type of merchandise purchased, how it is employed, and how much an individual will pay for it. This way of thinking is regarded as a fundamental technique for predicting what is to come since those who fall into the same target demographics frequently act in the same manner.
Geographic segmentation can be part of a demographic segmentation methodology, yet it can also be seen as its own individual way of dividing markets. This service distinguishes customers into groups based on location, as evidenced by the title. Considering the needs want and interests of customers vary depending on where they’re located, and knowledge of their geographical regions can aid in deciding where to both advertise and extend the business.
Demographic segmentation looks at individuals while firmographic segmentation looks at entities such as businesses, corporations, and other organizations. Segmenting target customers using firmographic data would take into account parameters such as the size of the business and the number of employees, thus providing an insight into the differences between providing services to small businesses as opposed to large corporations.
Behavioral Segmentation divides markets according to people’s actions and the way they make choices, for example, what they buy their lifestyle, and their usage of products and services. Younger customers may favor bottled body wash, while seniors may be likely to opt for soap bars. By grouping customers according to their purchasing habits, marketers are able to craft a more focused effort, allowing them to hone in on what customers are searching for and thus increasing the likelihood of them making a purchase.
This type of segmentation looks at psychological characteristics to divide up the marketplace, focusing on elements such as the lifestyle, values, attitudes, interests, and personalities of customers. Markets such as the fitness sector employ psychographic segmentation to categorize their clients into categories that are interested in well-being and exercise.
5 Examples of Market Segmentation in the Fitness Industry
Let’s discuss how you can apply market segmentation in the fitness sector given that you now have a better understanding of it. Below are five ways you can divide your potential customers in order to reach them more precisely.
This target group is already heavily involved in sports. They are passionate about sports and always make sure to set aside time for a game of tennis, soccer, or squash. They may even play at a competitive level. People come to your fitness center to make themselves more skilled athletes by increasing their agility, strength, and stamina.
Typically, these shoppers are highly driven and already possess the necessary skills needed to learn. People need a gym with the necessary tools, activities, and areas that can serve their preferred sport accurately.
The health needs group is striving to become fitter, enhance their physical strength, and possibly reduce their cholesterol levels. It is possible that a physician has instructed them to take action for the purpose of enhancing their well-being, and your gym is the initial place on their itinerary.
Someone who is attempting to be healthier may require extra support, encouragement, and advice. They can benefit from personal trainers and expert advice. Individuals who frequent the gym will require substantially more inspiration and individualized attention than the average person.
Making Friends and Socialize
One of the primary advantages of joining a gym is to make new connections. Exercising is a fantastic way to build relationships and entwine with others. This particular demographic is more preoccupied with socializing than the health advantages associated with going to the gym.
People of this kind usually have a decent level of physical fitness and they are capable of participating in classes. To attract someone with this character, consider introducing exciting and vigorous classes. Construct an area where people can socialize after exercising, such as a smoothie shop or coffee shop.
These people are at the top of their game. They are highly motivated and very fit. They are constantly looking to achieve their personal best. These individuals are intensely concentrated on either surpassing their own speed records or thriving in the field of bodybuilding.
The advantage of this collection is that they usually become long-term customers. By contrast, their skill may lead them to take control of certain parts of the gym, potentially scaring off the fresher members.
The target demographic for those trying to shed pounds is a motivated group. This collective has become a member of the gym in order to shed some pounds. Creating an atmosphere that is open and accepting of everyone regardless of their shape or size would be beneficial for this group.
This collective requires professional encouragement and stimulation. Consider presenting a six-week program focused on weight loss, or make the most of the personal training services on offer.
The Benefits of Market Segmentation for Your Fitness Business
Once you have recognized your intended audience, you can create segments within your market based on a range of criteria. Investigating the characteristics of your desired customer more closely is likely to require you to construct more than one archetype to comprehend who they are. There are many reasons why businesses use market segmentation. Below are eight advantages that your fitness center can gain by dividing the market.
Reach a Wider Audience
Market segmentation provides the chance to extend your reach to an even broader audience. No matter what demographic you’re trying to reach: men, women, the elderly, or young adults, there is a multitude of various responses you will get to various selling techniques. Promoting products or services on social media platforms may be successful when targeting Millennials, however, it may be a useless effort when attempting to engage seniors. Segmenting your intended viewers into various subdivisions will enable you to achieve a broader range of people in a proper and effective way.
As an illustration, those over 50 years old are now dwelling on health and physical activity. By the close of 2022, the David Lloyd health club chain is determined to have one fitness coach above 55 years old at every one of their facilities. People are living longer and longer. Targeting your goods and services to the demographic over the age of 50 may be a financially rewarding component of your venture. Ultimately, they have the means to enjoy themselves during their retirement years.
Save Time and Money
By segmenting the market, you can save considerable time and money in the future. As an illustration, age is a notable factor in how people utilize social media platforms. Age groups on the younger side tend to diversify their platforms of choice, with Instagram and Snapchat being the most popular. Most people over 65 primarily use Facebook. You should not target Instagram ads at individuals who are over the age of 65 with this data.
Breaking down your intended audience into different segments can help you to use your promotional funds efficiently and expeditiously. Discover the favored ways each of your target audiences interacts or engages, and learn where they typically congregate, both on and off the internet. Generating a substantial amount of research for your intended audience can help advertise your products and services successfully.
Increase Member Diversity
If you’re aiming to make your health and fitness club attract more people from different backgrounds, begin by hiring employees from a variety of backgrounds. If people who attend your gym all seem to have similar appearances, this could possibly dissuade someone from joining who does not fit in with them. It will be a challenge for them to imagine themselves as part of the group if they feel so different just by entering the room. Start by having a diverse team of staff. Your team should give a warm welcome and make sure that any newcomers quickly feel comfortable.
To draw in different sorts of people, you can offer different plans of membership. Most gyms and fitness centers provide two or three types of gym memberships, however, you have the potential for more. Consider the desires and requirements of your target audiences and create membership plans which cater to them. The bundles will address their individual necessities.
In order to effectively target your desired customer base, it is critical that you ensure your communication is directed towards the most suitable individual and that it is in line with their expectations. If your promotional content isn’t aimed at the appropriate audience, you’ll be wasting a lot of effort and resources on something that will never yield results. By dividing up your customer base through market segmentation, you can precisely tailor your marketing, content, and services to meet their individual needs.