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Segment to focus and maximise profits

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Director - Sales and Commercials, Sony Pictures

Anupam Sengupta, Director – Sales and Commercials, Sony Pictures

Is it near sighted or farsighted? Does your segmentation strategy begin by identifying a business opportunity and goes all the way to consumer adoption behaviour or does it fall short? Does it start too late or stop too early? Are you trying to use the same segmentation approach for each decision set you make? Segmentation, when used on three critical levels, can drive sales and profitability. Here’s how we recommend we can do it more effectively:

  • Structural Segmentation – ‘answers the question should we play in that segment ’
  •  Need Based Segmentation –‘answers the question what should we offer’
  • Sales Efficacy Segmentation-‘answers the question who’s our next customer ‘

The structural segmentation can help identify markets that offer a higher contribution. Need based segmentation drives product /service development. Sales Efficacy Segmentation builds sales momentum by targeting hot prospects and those consumers most likely to switch. Let’s understand this from a Hollywood Studio business perspective.

Structural Segmentation-It focuses on your strength with customers, channels and product categories. Product Mix in this case will be futuristic physical formats like 2D/3D Bluray and DVD, Emerging VOD services, Digital and Physical Bundles of content through Applications, OEMs and Pay TV services. So as an example let’s consider Digital Content application bundles with OEMs , Consumer Electronics are great tools to expand consumption of Hollywood movies to a large segment of audience who have probably do not go to theatres or buy packaged media – Consumer Electronics, Mobile partners, Consumer Product brands etc become an important channel as they target different consumer types and at different price point . A High End smartphone consumer will be very different from a Indian player entry level smartphone consumer and the content taste for sure will be different. Assessment of these carrier channels , their consumer segments and products that will enhance device and consumer experience becomes critical for Hollywood studios .This then becomes a unique segment and creates a strong pull for studio content.

Need Based Segmentation– There are Early Adopters or Digital Junkies primarily 18-34 yrs Males who want to consume movies on the Go even in India – They are increasingly pushing the studios to relook into their window strategy and offer entertainment solutions on their favorite device . India’s smart-phone market is growing at a scorching high double digits led by Android and a market that straddles both ends of the price spectrum , an early mover advantage for any Hollywood studio with their movies , shows , special interest content , local content presents a clear opportunity to engage consumers and CRM opportunities . Social Cinema can again become a phenomenon given 50 mills + base and a well developed social currency available for transacting on these networks especially facebook.

Sales Efficacy Segmentation: Bluray with its enhanced Hi –def 1080p and crystal clear sound (as close to the original score as possible) is a segment where consumers are now motivated to buy given increased seeding of bluray and other compatible players . The premium perception and a commensurate price tag on limited software content has been challenging for studios. Go-to –Market Drivers like Creating exciting consumer offer promotions, Special Hi-Def experience corners with appropriate Studio content and partnerships with Consumer electronic sales channels to creates unique sampling opportunities helps conversions and positive experience within the whole value chain . Blu-ray remains a high margin priority experiential format for the studio at retail and helps the channel build positive experiences for their customers on the high volume LED TV / Smart TV segment. Studios are also expecting fast adoption of USB as a format for Hi-def consumption at retail.

The views expressed here are of the author alone, and do not necessarily reflect the views of Pitch

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