Documenti di Didattica
Documenti di Professioni
Documenti di Cultura
MARKETING
MANAGEMENT
INTRODUCTION
Research in organisational segmentation has gained momentum as firms seek ways
to differentiate their value propositions based on what their target accounts value
the most. By now, astute marketers recognise that a Henry Ford Model-T one size
fits all approach to marketing runs the risk of connecting to no one. Consequently,
*Correspondence details and biographies for the authors are located at the end of the article.
JOURNAL OF MARKETING MANAGEMENT, 2009, Vol. 25, No. 3-4, pp. 315-340
ISSN0267-257X print /ISSN1472-1376 online Westburn Publishers Ltd.
doi: 10.1362/026725709X429773
316
JMM
firms count on segmentation techniques that enable them to craft their selling
strategies around a buyers unique personality, beliefs and organisational influences.
Starting with the target identification process, segmentation is seen as the key to
focusing on a firms most profitable customers (Peppers and Rogers 2004). Strides
made particularly in psychographic segmentation have led to the widely publicised
approaches to adaptive selling behaviours (Weitz, Sujan and Sujan 1986) and product
planning (Weinstein 2004). With growing interests in global marketing, these adaptive
strategies will become even more important as marketers seek to find common ground
with buyers of different cultures (Hofstede 1980).
Such perspectives are further challenging the efficacy of demographic segmentation
as it fails to capture the personality nuances (e.g. psychographics) that separate
customers by meaningful brand experiences and relational behaviours. Instead,
a growing argument is developing in favour of using business-to-business (B2B)
psychographic segmentation to characterise a purchasing agent or managers buying
mentality. As this paper will demonstrate, firms do indeed pervade cultures much
like an individuals personality or lifestyle. The entertaining Apple versus IBM
promotional campaign (Mac vs. PC cultures) is an excellent illustration of two widely
contrasting corporate identities.
In spite of the acknowledged usefulness of psychological segmentation in
organisational settings, the formalisation of marketing and operational plans
around psychographic dimensions is limited. Frameworks for classifying buyers
along psychographic dimensions are subjective and difficult to measure. Moreover,
regardless of support for the concept of corporate cultures (Cameron and Freeman
1991; Deshpande, Farley and Webster 1993), the viability of planning around
enterprise-wide personalities is in doubt. Even if a pervasive personality were
adequately defined, questions remain as to their situational nature and relevance.
Further compounding the adoption of psychographics to organisational settings
is the complexity of the buying centre. Industrial market characteristics, for
example, differ sharply from consumer markets (B2C) on several dimensions which
impact segmentation analysis and other strategic marketing decisions (Kotler and
Keller 2009). Not only are many individuals involved in B2B settings, but special
justifications, authorisations, and approvals often restrict the influence of personality
on buying decisions. The industrial salesperson is instead confronted with a more
formula-driven buyer than is typically found in the consumer sector. But despite its
apparent objectivity in decision making, ample evidence suggests this organisation
buying process reacts to socio-sentimental factors that some may attribute to the
inherent psychographic make-up of a firms unique personality (Deal and Kennedy
1982; Handy 1995; Rangan Moriarty and Swartz 1992).
So how far have we come from the inception of organisational psychographics?
In this paper, we examine the degree to which B2B psychographic segmentation is
growing in adoption and sophistication. As testimony to its strides over the past
fifteen years, William D. Neal, the founder of SDR Consulting (Atlanta, Georgia,
USA) and former president of the American Marketing Association, acknowledges that
business managers have relearned the benefits of target marketing. Most marketers
now recognise that simplistic segmentation schemes based on demographics, geography
or SIC codes are suboptimal at best and disastrous at worse (Neal 2002, p.37).
Hence, the purpose of this article is to critically examine the current state-of- affairs
in organisational psychographics. First, we review the relevant scholarly literature
from both a conceptual and application perspective. Next, we develop and discuss a
case application of a high technology company (Collins Aviation Services, a division
317
318
JMM
(Shapiro 2002)
Defining business psychographics rationale and support
Like consumer (B2C) analysis, B2B marketers must understand people, relationships,
and psychological drivers. A notable distinction of the industrial buyer, however, is
its membership of a complex buying centre influenced by enterprise expectations
and business objectives. Moreover, the role of lifestyles (prevalent in B2C settings)
is arguably subjugated to the culture that suffuses an enterprise. The importance of
job security likely leads to risk reducing behaviours more applicable to organisational
than to consumer settings.
We advocate that organisational psychographics research focus on the innermost
ring of Bonoma and Shapiros (1983) nested approach. The work of Bonoma and
Shapiro (1983) combined with that of Mitchell and Wilson (1998) would suggest
that industrial buyers are largely influenced not only by their underlying motives and
relational styles but by their risk orientations as well. Consequently, we propose that
organisational psychographics be defined as:
the segmentation of organisational buyers into homogenous clusters of mindsets and
behaviours that are distinguished by motives, risk perceptions and social interaction
styles in order to identify prospects as well as predict the predispositions of the firms
decision makers for the sake of adapting products, marketing messages and relational
selling behaviours
From this definition, buyer motives and styles are assumed to be influenced by
the buyers personal needs as well as from the cultural norms at the enterprise
and country level. By capturing these personal variables that influence a buyers
predispositions, suppliers can better tailor their value propositions and adjust their
communication styles. According to Bonoma and Shapiro (1983), an understanding
of these variables requires a suppliers ability to understand and appreciate the
subtle signals sent by buyers in day-to-day interactions, (p. 88). These signals are
gleaned from examination of the buyers motives, buyer-supplier relationships and
risk perceptions (Mitchell and Wilson 1998). Shown in Figure 1 are the inner ring
buyer decision influences discussed in the following literature review. The usefulness
of organisational psychographics to marketing has been demonstrated in a number
of empirical studies that validate its contribution to predicting buying innovativeness
(Robertson and Wind 1980), product adoption (Verhallen, Frambach and Prabhu
1998) and purchase intentions. The latter is impacted indirectly through the similarity
(e.g. shared values) a buyer sees between themselves and their supplier (Bonoma and
Shapiro 1983).
Some empirical studies have also demonstrated the incremental impact that
organisational psychographic variables (e.g. conflict behaviour, open communications,
etc.) have on the explanatory power of marketing decision making. Robertson and
Wind (1980), for example, found that employing organisational psychographic
FIGURE 1 Influences on buyer personal characteristics (Adapted from Inner Ring of
Bonoma and Shapiro Model, 1983)
Personal Needs
Strategic Planning
Culture & Corporate
Decision Style
Technical Orientation
Risk Perceptions
Uncertainty
Avoidance Behaviour
BUYER
MOTIVATION
BUYER
RISK
MANAGEMENT
BEHAVIOUR
BUYER
RELATIONSHIP
STYLE
319
320
JMM
variables improved the explained variance by more than 25% versus demographics
alone. Through cluster analysis, others demonstrate distinct purchasing motivations
(File and Prince 1996; Rangan, Moriarty and Swartz 1992; Verhallen et al. 1998),
risk behaviours (Mitchell 1994; Wilson 1971) and relational styles (Fine 1991) when
buyers are grouped along psychographic dimensions.
Business psychographics the three dimensions of personal characteristics
Personal characteristic: motivation dimension of the innermost nest
By analysing purchase motives, marketers can better understand why buyers act
the way they do in the marketplace. A critical step to sizing up a buyers personal
characteristics is to get a firm grasp of the psychographic motivators to which the
supplier appeals (Shapiro and Bonoma 1984; Russell 2008). According to Bonoma
and Shapiro (1983), the process of thinking through the motivational classes clarifies
selling strategy and can lead to better tailoring of selling tactics to buyer motivations,
(p. 79).
Traditionally, this perspective of motivators was based on rational assessments
(e.g., price, quality and service). In their discussion of the innermost nest, however,
Bonoma and Shapiro (1983) point out that the non-rational or social aspects of
industrial buying are at least as important as the rational motives. The authors refer
to evidence presented by Webster (1968) that industrial buying is a joint function
of the personal needs of purchasers for recognition and advancement and their social
needs to satisfy those in the firm who will be the users of the purchased good (Bonoma
and Shapiro 1983, p. 88)
One theory that perhaps best classifies these personal needs along dimensions
of recognition, advancement and social needs is Maslows Hierarchy of Needs.
According to this theory, a buyers psychographic motivators advance from survival
(basic needs) and security (safety) to a desire for affiliation (belonging), recognition
and advancement (self-esteem) and self actualisation. As a widely used sales training
tool, this approach to grasping a buyers psychographic motivators has stood the test
of time. Much of its popularity as a type selling approach stems from its legacy in
organisational buying behaviour as well as its relatively easy approach to classifying
buyers. For example, extensive cues from a buyers dress, office setup and body
language are offered in the practitioner ranks. Soper, Milford and Rosenthal (1998),
however, do warn against its use beyond a cognitive map given its limited scientific
support.
Beyond these intrinsic needs, it behoves suppliers to grasp an understanding of
their buyers extrinsic motivations as well. A number of studies demonstrate how
corporate cultures influence a buyers motivations through their planning approaches.
Studies by Cameron and Freeman (1991) and Deshpande et al. (1993), for example,
found that differences in corporate cultures account for variances in market strategy
emphasis. In particular, they discovered distinctions across groups divided by
processes (e.g. processes characterised by flexibility and spontaneity vs. control and
stability) and corporate orientation (e.g. internal maintenance vs. external market
positioning). These two dimensions, which are psychographic proxies, are then used
to cluster organisations around four corporate cultures:
1 Market culture (focuses on competitiveness and goal achievement)
2 Adhocracy culture (focuses on innovativeness, entrepreneurship and risk taking)
3 Clan culture (focuses on loyalty, smoothing and tradition)
Still others argue that motivations are influenced largely by the strategic decision
making mentality of the enterprise. In their reappraisal of B2B segmentation, Mitchell
and Wilson (1998) suggest that the decision making process itself be used as a basis
for segmentation because it could help in determining the appropriate methods
of personal selling and communications, (p. 434). Some propose that the CEO
decision style greatly influences the motivation of the purchasing decision maker. As
an example, small and medium-sized, family business clients of professional service
providers (accounting, insurance, and law firms) were researched using organisational
psychographics (File and Prince 1996).
Finally, a number of studies reflect a technology adoption behaviour that influences
a buyers psychographic motives. In a study of car phone purchases by 200 Dutch
firms (a new buy purchase decision in six major industries), the authors demonstrate
distinctions in corporate strategy behaviour that extend beyond demographics
to unobservable characteristics. They classified buyers as defenders, prospectors,
analysers, and reactors. In contrast, the two firmographic variables, firm size and
industry, had little explanatory value with respect to the adoption or non-adoption
of the proposed technology (Verhallen, Frambach and Prabhu 1998).
According to the diffusion literature, there are five categories of new product
acceptance - innovators, early adopters, early majority, late majority, and laggards
(Rogers 1983). Lead users or super-innovators face strong market needs months or
years before the bulk of the marketplace and expect to benefit significantly by helping
to find a solution to those needs (von Hippel 1988). According to Easingwood and
Koustelos (2000), innovators may be techies (users excited by the new technology)
or visionaries (managers who can see a products potential for improving processes,
enhancing operations, or delivering value to gain a competitive advantage).
This distinction in technology adoption behaviour is reflected in a number of
empirical studies. For example, a qualitative research study by Weinstein (2004)
revealed six potential market segments for automatic pacemakers based on
technology adoptive behaviour. Although a battery of factors were considered in
segment formation, one major psychographic attitudinal variable (user orientation)
was most useful in understanding the automatic pacing market. This was expressed as
a primary interest in technology, simplicity, or conservatism in decision-making.
As demonstrated in Table 1a, these and other studies support Shapiro and
Bonoma (1984) inclusion of psychographic motivators when classifying a buyers
personal characteristics (innermost nest). Despite the distinct origins and typological
dimensions, the table also suggests we consider buyers as either cost cutters, early
adopters, organisers or fraternities. Knowing this will help the sales force to tailor
feature emphasis and value propositions (e.g. based on value, cutting edge features,
simplicity, etc.).
Personal characteristic: risk dimension of the innermost nest
The second dimension of personal characteristics relates to a buyers risk adversity.
According to Bonoma and Shapiro (1983), a purchasing managers reaction to risk
is central for understanding and segmenting the purchasing situation, (p. 84). In the
specific case of industrial purchasing, this risk focuses on either the buyers personal
risk or the organisations risk (Mitchell 1994).
A number of studies found risk reduction to be associated with vendor selection
321
Strategic
Planning
Culture &
Corporate
Decision
Style
Maslows
Hierarchy of
Needs Theory
Personal
Needs
Belongers
Seek
competitive
advantage
Seek policies
adherence
& smooth
operations
Autocrats
Seek
teamwork &
loyalty
Loving Parents
Empire Builders
Markets
Hierarchies
Product Life
Cycle Theory
Phase of the
Purchase
Decision
Purchase
Relationship
Buyers
Transaction
Buyers
Seek best
price & service
trade-off
Bargain Hunters
Analyser
Seek technology
talk, compatibility &
customisation
Seeks evidence
of success
Reactor
Fortune Hunters
Adhocracies
Sophisticates
Seek supplier
Seek
rotation
partnerships
Programmed
Buyers
Self-Actualists
Novices
Seeks
efficiency
Seeks
innovation
First Time
Prospects
Seek trust,
information &
hand holding
Defender
Prospector
Egos
Seek
Seek
Seek
Seek affiliation
achievement
information &
recognition
& free time
& job
assurance
& promotion
fulfilment
Security
Conscious
Clans
Seeks cost
savings
Survivors
Psychographic Classifications
Price &
service
offerings
Sales
interaction
& image
management
Product
adoption
& selling
strategies
Adaptive
selling
behaviours
& product
bundling
Negotiations
& product
adoption
Selling
strategies
Moderate
High
Moderate
Moderate
Moderate
Low
Documented Measurability
Uses
1)
Usefulness
Verhallen,
Frambach &
Prabhu (1998)
Cameron
& Freeman
(1991), Quinn
(1988),
Deshpande et
al. (1993)
Soper, Milford
& Rosenthal
(1995)
Study
References
172 buyers
of industrial
packaging
Rangan,
Moriarty &
Swartz (1992)
Case study
Robertson &
of leading
Barich (1992)
industrial firm
205 Dutch
firms
Hierarchical
cluster
analysis of
397 samples
US &
Japanese
executives
Widespread
popularity
lacks
scientific
support
Empirical
Context
JMM
Cameron
& Freeman
Model of
Organisational
Culture Types
Typology
Underpinnings
Influence
on Buyer
Decision
Making
322
Journal of Marketing Management, Volume 25
NA
Forrester
Research
Technographics
Berens
Interaction
Styles Model,
Social Styles
models and
DiSC
Miller Heiman
Executive
Impact &
Large Account
Mgmt Process
(LAMP)
Seek supply
chain
optimisation
support
Black Box
Devotees
Progressives
Show Mes
Seek
evidence
NonBelievers
Seek reason
to purchase
No Perceived
Needs
Seek
Seek
Seek affiliation
achievement
recognition &
& free time
& job
promotion
fulfillment
Seek
Seek simplicity demonstration
of success
Seek time
savings &
productivityoriented
technologies
Seeks
frequent
upgrades
& trendy
technologies
Cyber Snobs
Traditionalists
Fast Forwards
Seek to get
desired result
Mouse
Potatoes
Seek to get
an achievable
result
Seek to get
an integrated
result
Hand Shakers
Get-Things-Going
In-Charge
Behind-theScenes
Seek
technology
innovation
Contract
negotiations
Product
adoption
Product
adoption
Influencing
buyers;
conversation
tone & speed
Thinkers
Skeptics
Followers
Controllers
Key account
Seek decision
Seek
Seek to
selection
making
Seek only those similarity of
manage every & resource
methodology
things that fit decisions to
aspect of the
planning
(review every their world view those made
decision
pro/con)
in the past
Economisers
Operationalisers
Chart-theCourse
Seek new,
bold &
innovative
ideas
Charismatics
Optimisers
Seek fast &
responsive
support
to make
transitions
Low
Low
Low
High
Low
Pace maker
case study
No known
empirical
support
Limited
empirical
support
Widespread
popularity
lacks
scientific
support
Dow Corning
case study
Weinstein
(2004)
Weinstein
(2004)
Berens (2001)
Miller,
Williams &
Hayashi (2004)
Ballinski,
ALlen &
DeBonis
(2003)
BioInformatics
Scientific
Personality
Assessment
Enthusiast
Explorer
Leader
Organiser
Questionanire
collaboration
Selling to
Seek to
Questionnaire
from
Seek to venture Seek to guide &
scientific
BioInformatics
interact &
Seek cautious decision
administered
community
into uncharted manage other
reach group
making from facts & data communities
of
biomedical
territories
researchers
consensus
researchers
1) High - classifications are based on objective statistical methods (e.g. sales data); Moderate - derived from attitude surveys: Low - derived from subjective evaluations (e.g.
office dcor, body language, conversation, demeanor and dress).
Technical
Orientation
Strategic
Planning
Culture &
Corporate
Decision
Style
Innovators
Generic
Seek leading
Customer
ideas or
Value Segment
technology to
Matrix
create edge
324
JMM
and brand trust (Cardozo 1968; Cooper et al. 2006; Valla 1982). Buyers prefer known
vendors and long-term relationships to unknown vendors. Evidence of risk reduction
through product alignment was found in a segmentation study of physicians that led
to more efficient sales calling. This analysis examined the intersection of doctors
values with the brand proposition and their script writing potential. Based on this
research, the firm eliminated 39% of the doctors in their panel (two segments) due
to their lack of belief alignment with the brands proposition. The remaining, highly
targeted physicians (61% of the market, comprising three segments) increased the
brands total prescriptions by 50% within a year, while the non-detailed physicians
cut their prescription writing by only 10% during that period (Kuenne 2000).
Another aspect of segmentation by risk adversity is found in the cross-cultural
work of Hofstede (1980). One widely studied variable in marketing literature is the
role of uncertainty avoidance. Hofstede (1980) defines uncertainty avoidance as the
extent to which the members of a culture feel threatened by uncertain or unknown
situations (Hofstede 1994, p. 113). Classification of nations is made through a
country score. Subsequent to Hofstedes (1983) study, a number of researchers have
validated the influence of uncertainty avoidance in determining a buyers system of
norms and governance. For example, countries characterised with high uncertainty
avoidance are comfortable with legislation. Buyers in Germany (Uncertainty
Avoidance Index of 65), for example, are known to operate under an extensive set
of rules and regulations. The UK (UAI of 35), a nation with no written constitution,
operates under less formal arrangements (Hofstede 2001). Besides using the UAI
score for formality understanding, others (Giarratana and Torres 2007) have found
that lower UAI leads to a propensity for product innovativeness.
Shown in Table 1b are the additional studies suggesting typologies for risk perception
and risk management segmentation. In a study of purchasing agents and managers,
Wilson identifies three psychographic segments: conservatives (seek reassurance of
risk reduction), switchers (seek best deal), and normatives (seek maximum value).
In a similar vein, a study of buyers in the UK (Mitchell 1994) found distinct buyer
behaviours along financial and psychosocial risk. Their study refers to young recruits,
new timids and old timers.
Personal characteristic: relationship styles dimension of the innermost nest
Beyond purchasing motives and risk adversity, buyers differ widely on social factors
as well. Mitchell and Wilson (1998) argue that firms often operate within markets
where powerful social networks exist. Yip (1993) reports a case of how Shell
Lubricants UK improved their sales results after segmenting their customers into
eight such groupings of buyer personality traits.
Here, too, national culture plays a role in shaping buyer predispositions.
Specifically, the buyers nation of origin or operation has much to do with their
relational orientation. Hofstede (1980) refers to collectivism and individualism as
measures of a countrys orientation to individual desires versus group interests.
Later empirical results (Doney, Cannon and Mullen 1998; Williams, Han and Qualls
1998) found this dimension to be a useful classifier of a buyers socio-sentimental
attachment (high collectivism) or economic attachment (high individualism) to a
supplier. Similarly, buyers of cultures characterised by high masculinity place far
greater emphasis on bottom line results than do those of high femininity. Buyers of
feminine cultures place greater emphasis on personal relationships and trust (Barry
and Johnson 2005).
Country
Uncertainty
Avoidance
Index (UAI)
Seek to maximise
economic value
Low UAI
Normatives
Conservatives
Switchers
Characterised by low
financial risk and low
psychosocial risk
Old Timers
Characterised by low
financial risk and high
psychosocial risk
New Timids
Characterised by high
financial risk and low
psychosocial risk
Young Recruits
Psychographic Classifications
Moderate
Moderate
Personal
selling
Personal
selling &
pricing
strategies
Documented Measurability
Uses
1)
Usefulness
185 UK
purchasers
of planning
consultant
services
132
purchasing
agents &
managers
Empirical
Context
Wilson (1971)
Mitchell (1984)
Study
References
High UAI
Arindell et
Numerous
al. (1997),
Relationship
cross-cultural Giarratana &
High
Calm, happy and Lo-emotional
Nervous, stressful, emotionallymarketing
marketing
Torres (2007) &
countries
expressive countries
studies
Litvin, Crotts &
Hefner (2004)
1) High - classifications are based on objective statistical methods (e.g. sales data); Moderate - derived from attitude surveys: Low - derived from subjective evaluations (e.g.
office dcor, body language, conversation, demeanor and dress).
Uncertainty
Avoidance
Behaviour
NA
Risk
Perceptions
Wilsons
Industrial
Buyer Decision
Typology
Underpinnings
Influence
on Buyer
Decision
Making
Social
Interaction
Styles
Seek business
socialising & trust
Social Buyers
Alessandras
Rapport &
Tension Model
Berens
Organising
Patters of
Personality
Carl Jung
Cognitive
Process
Stabiliser
(Logistical)
Seek
responsibility &
to fit in
Socialser
Catalyst
(Diplomatic)
Seek to be
authentic &
empathic
Director
Relater
Theorist
(Strategic)
Intuitive Thinkers
Seeks logical
options from big
picture
Usefulness
Relationship
building
Thinker
Seek to have
impact & to get
results
Improvisor
(Tactical)
Seeks vision
contribution
Intuitive Feelers
Building
buyer
relations
Communication,
interaction &
sales focus
Value
propositions
& selling
approaches
High
Moderate
Moderate
Low
Moderate
Documented Measurability
Uses
1)
Adaptable
selling
behaviours
Seeks results in from initiation
real asset growth
through
closure
Expressives
Seek to prove
their case
Factual Suppliers
Seek problem
Seek
Seek to control &
Seek status quo & solving & working
admiration &
achieve
strong networks
toward tangible
acknowledgement
results
Sensing Feelers
Seeks business
growth
Seeks course
direction
Seeks factual
clarification
Sensing Thinkers
Amiables
Seek to sell
themselves
Social Suppliers
Analyticals
Factual Buyers
Seek more
business
information &
less chat
Psychographic Classifications
Drivers
Merrill-Reid
Assertiveness &
Responsiveness Seeks long-term
financial stability
Model
Berkovitz
Theory of
Knowledge
& Chisolm
Typology
Typology
Underpinnings
Widespread
popularity
lacks
scientific
support
Widespread
popularity
lacks
scientific
support
70 executives
(Galln 2006
study)
Limited
empirical
support
384 industrial
buyer/
supplier
dyads
Empirical
Context
Alessandra
(1996)
Berens (2000)
Myers et al.
(1998)
Fine (1991)
Study
References
JMM
Influence
on Buyer
Decision
Making
326
Journal of Marketing Management, Volume 25
Dominants
Keirseyan
Temperament
Theory
Feminine
Seek to expedite
& improvise
(Hemingway)
Artisans
Passive
Seek appreciation
& conflict
avoidance
(watcher style)
Seek stability,
information &
organisation
Supporters
Masculine
Seek to inspect,
supervise
& conserve
(Washington)
Guardians
Seek accuracy
& proof (thinker
style)
Analytical
Seeks
correctness;
analytical; needs
to see value
Compliant
Seek
competitiveness,
Seek social bonds, Seek quality of life
material
harmony & loyalty & people concern
needs & goal
accomplishment
Collectives
Idealists
Seek diplomatic
integration
through
mentoring
& conferring
(Gandhi)
Seek recognition
(talker style)
Expressive
Need personal
relationships
Influencers
Advertising,
relationship
marketing &
global brand
strategies
Building
trust &
rapport
Building
trust &
rapport
Communication
& sales
recruiting
High
Moderate
Low
Moderate
Keirsey (1998)
Boe (2006)
McCarty &
Hattwick
Numerous
(1991);
cross-cultural
Gregory &
marketing
Munch (1996);
studies
Roth (1995) &
Zandpour et
al. (1994)
Limited
empirical
support
Widespread
popularity
lacks
scientific
support
Considerable
empirical
Marston (1929)
support
1) High - classifications are based on objective statistical methods (e.g. sales data); Moderate - derived from attitude surveys: Low - derived from subjective evaluations (e.g.
office dcor, body language, conversation, demeanor and dress).
Seek personal
gratification
Individualists
Seek strategic
planning,
configuring
& inventing
(Einstein)
Rationals
Aggressive
Hippocrates
Seeks bottom line
Theory of
Temperament results (worker
style)
Cultural
Hofstedes
Relationship Cross-Cultural
Style
Dimensions
Temperament
Styles
Social
Interaction
Styles
Marstons
DiSC
Behavioural
Styles
328
JMM
In their search for a viable prioritisation model, CAS business development and
sales management teams adopted a more customer-centric form of segmentation to
grow its $450 million per year business. The intent was to group customers into
various categories of revenue potential while permitting a customer profile for
adaptive sales strategies.
The existing segmentation approach lacked a psychographic foundation required
to target prospects. For example, little was known of the business culture, channel
characteristics or overall service applications of top CAS prospects that could help
sales personnel in their key account assignments.
Following its annual sales conference, CAS executives rolled out a sales planning
process that encompassed the components and applications of the new view
of market segmentation which combines internal business planning structures,
geographics, channels and psychographics. Overall, as demonstrated in Figure 2
(over page), the new service organisation appears to have developed a more practical
segmentation framework for sales resource allocation planning, and competency
growth planning.
Buyer motivation played a major role in the psychographic analysis. A database was
created to reflect the personality of customers and categorise them as strong or weak
prospects for growth. Psychographic profiles along with sales records and prospect
commentary, are used to determine the allocation of the following sales resources:
scheduled sales and customer service visits, customised proposal development, onsite
customer technical support, electronic warranty administration, order fulfilment and
documentation support.
By developing databases according to account personalities, the company has a
better grasp for divvying up its scarce sales resources. For example, one sales manager
admitted that customers considered daters would only be provided the annual parts
number catalogue and reference to the firms web site. Previously, such an account
was given the same attention in field sales rotations as accounts deemed far more
sales worthy.
Buyer risk was also evaluated as a psychographic component. Research found
that new airline start-ups and smaller charter operations had a more entrepreneurial
approach to vendor management. This often required a less formalised negotiation
process and stronger relationships with front-line sales personnel.
Finally, buyer relationships were an important psychographic variable. Despite its
worldwide market presence, little was done previously to target and qualify prospects
in geographic territories. The global sales force acknowledges the great disparity in
cultural characteristics that would indeed influence selling strategies. Segmentation
such as that offered in Hofstedes (1983) country scoring would better characterise
customers by geography as well as help identify distinct strategies for building longterm loyalty.
The segment descriptors further indicate the style of relationship preferred by
customers. For example, many of the Far East, Southern Europe and Latin American
prospects were described by the sales force as being far more relational than
Americans. Finally, the more fraternally oriented operations (e.g. Star, SkyTeam,
Wings and Oneworld Alliances) required large scale and high level team selling.
Overall, the following baselines were considered when segmenting CAS prospects
into account profiles:
1 Degree of country collectivism - relational versus individualistic (relationship)
2 Degree of corporate stability and longevity - entrepreneurial versus institutional
(motivation)
329
Daters
Relational
Harmonisers
Drag
Racers
Airline
Operators
Plea
Bargainers
Aircraft Mod
Centers
Passenger
Systems
Test
Trialers
Aircraft
OEMs
FIRMOGRAPHIC
GROUPINGS
Bargain
Shoppers
Best Value
Calculators
PSYCHOGRAPHIC CLUSTERS
Back
Scratchers
Aftermarket
Asia Pacific
Materials
Government
Maintenance
Business &
Regional
National
Fraternities
Parts
Brokers
Americas
Air
Transport
Tech Ops
Collins Aviation
Services
JMM
Rockwell
Collins
FIGURE 2 CAS blending of psychographic market planning into corporate operating plans
330
Journal of Marketing Management, Volume 25
3 Degree of reliance - market constrained and service critical versus low risk from
switchover (risk)
4 Degree of fraternal connection - alliance bound versus autonomous
(relationship)
An example of how sales prospects were clustered along these dimensions is shown in
Figure 3. A segment profile for one key segment, the relational harmonisers, is then
shown in Figure 4. Note the depth of the marketing information available through
this clustering approach. As its name implies, relational harmonisers want to be in
the relationship and seek vendors and service providers that are committed to a
partnership, deliver value and are trustworthy.
FIGURE 3 Clusters used by CAS for sales planning and marketing communications
Buyer
Technology:
High Tech
National
Culture: Collectivist
Relational
National
Harmonisers Fraternities
Collectivist
Low Tech
Individualistic
High Tech
Individualistic
Low Tech
Daters
Plea
Bargainers
Back
Scratchers
Drag
Racers
Best Value
Calculators
Test
Trialers
Bargain
Shoppers
Firm Size:
Small Operation
Moderate/Large
Small Operation
Moderate/Large
Maturity:
Young Firm
Mature
Young Firm
Mature
331
332
JMM
Behaviours
Relational Needs
Collectivist
Governed by relational
norms (e.g. solidarity,
mutual goals, etc.)
Social benefits
50-100 aircraft
Information exchange
Shared values
Switching Opportunities
Trends
Incumbant performance
and/or relational
issues
Moderate growth
Customers
Braathens
Competitors
Regional brethren (other
airlines)
Lan Chile
Air Jamaica
3rd parties
China Eastern
Air 2000
OEMs
Buyer/Supplier Power
Balanced
Strategies
Build social bonds (high face-toface contact, social events)
Demonstrate empathy,
willingness to compromise/
resolve conflicts
Select front-line employees in
line with customer traits and
values
Indoctrinate relational norms
Signal pledges (trust) with
relational investments
grasp of the demographic and usage variables (e.g. volume, geographics, physician
and patient profiles, etc.), greater insights were needed about the whys and hows of
purchasing behaviour.
Psychographics are often combined with usage and benefit segmentation when
crafting strategies for brand recognition and product feature development (Nijmeijer
et al. 2004; Tapp and Clowes 2002). As an example, Nokias strategic decisionmaking process historically considers aspects of lifestyle with both usage and price
to derive a three-dimensional perspective of target users. A subsequent exercise then
collapses the many segment possibilities (usages x lifestyles x price levels) into fewer
cell phone categories labelled as the expressive, fashionable, communicator, classic and
basic. This same argument for combining segment criteria has merit in the business
market. Instead of lifestyle and personality categories, however, relationships among
organisational buyers and suppliers are affected by a cultural persona. Shown in
Figures 5 and 6 are examples of how the combined consideration of business usage
and cultural persona led to more distinct positioning strategies in the case of B2B
services and products, respectively. Using one dimension (usage or culture) as the
dominant baseline allows the collapsing of too many segment combinations to a
manageable few.
Technical orientation is another important consideration that impacts buyer
motivation.
As an example, Motorola University identified ten market segments as it expanded
its core market of training courses to customised knowledge. The info grabbers segment
was of particular interest to the market segmentation team. A value proposition was
created for this target market and expressed as follows right knowledge, right now.
Qualitative research revealed that info grabbers valued immediacy, off-site access,
customised knowledge chunks rather than traditional courses, the latest/greatest
information, and highly practical solutions.
FIGURE 5 Positioning strategies from personality/usage segmentation (B2B services)
Business Use
Working Lunches
Reception Events
Nutritionists
Persona
Nutritionists
Penny Pinchers
Caf Support
Boxed to Go
Delighters
Spoon Feds
Kitchen Sergeants
Maitre De
Elegants
Targeted Segment
Value Proposition
Boxed to Go
Eat on the go
Individually wrapped
Nutritionists
Eat healthy
Personal selling
Delighters
An event to remember
333
JMM
New Construction
Blenders
Persona
334
Jet Setters
Innovators
Artsy
Wannabees
Perk Me Up
Expressives
Cheap Chics
Shoppers
Targeted Segment
Architect Trend
Conformance
Value Proposition
Jet Setters
Classy, contemporary
designs
Perk Me Up
Grandiose
Aesthetically pleasing,
conveniently applied
products
Expressives
Internet, construction
firms, builders & art deco
magazines
Cheap Chics
Buyers risk adversity may also play a major role in organisational purchase decisions.
Most B2B firms find comfort in having well defined metrics in which to base their
decisions. Consequently, switching to psychographics places uncertainty on the
accuracy of market share forecasts and other marketing plan calculations. Decision
makers must therefore be convinced that gains in strategic pinpointing outweigh the
research and implementation challenges of using psychographic analysis.
An analysis of buyer relationship styles can assist in designing effective product
strategies and promotional campaigns. Sportmed, a marketer of medical instruments
to sports medicine specialists and general practitioners, used psychographics
for product planning. Its primary market was traditionalists or price buyers seek
relatively low-end instruments. An advanced product line, however, was introduced
primarily in response to an emerging progressives segment in developing nations. In
this case, Sportmeds high-end, leading-edge product appealed to this psychographic
segment. Product (features, functionality, accuracy, and image) and non-product
needs (education, information, service, and image) were carefully evaluated in the
identification of the progressives via psychographic research.
Finally, in the case of B2B promotional campaigns, Citrix Systems applied
psychographics for its online, multi-media, multi-party conferencing product.
Recognising the sports inclination of its Go-to-MeetingTM segment, Citrix runs a
highly successful advertising campaign on Sirius Satellite Radios National Football
League Channel 124 to reach this lifestyle segment.
The segmentation literature explained how psychographics are utilised as a means
of tailoring promotional messages and selling strategies. In particular, the research
identified areas where psychographics provide insights into a buyers personal
motivations as well as their interaction styles and response to risk. Without these cues,
marketers may underestimate how buyers are influenced from enterprise behavioural
norms and country-of-origin effect. Moreover, they may fail to assess the degree of
buyer aspirations that impact their willingness to adopt new technologies or change
strategic direction. Finally, only through a psychographic analysis can marketers
get an accurate view on the buyers preferred method of social interaction this
is especially important during initial selling approaches and negotiations for sales
closure.
An exclusive reliance on personality typologies is not sufficient for adaptive selling
or sales resource planning. An overemphasis on psychographics may neglect other
salient segmentation variables such as order size, product application, urgency of
need or other factors described in Bonoma and Shapiros (1983) nested model. Few
consumer-oriented empirical studies, in fact, rely solely on interpersonal variables
such as lifestyle, attitudes or opinions when targeting key prospects.
Of the conceptual and empirical work to date, however, few studies can explain
that psychographics plays a more powerful role than firmographics. Much of this
may relate to the lack of valid psychographic baselines in which to divide buyers
into relevant groups. Consider the Social Styles Matrix widely used in sales training
seminars. Despite its widespread support for a buyers responsiveness and assertiveness
as a demarcation for buyer personalities, no evidence suggests that these dimensions
best represent style distinctions that are most relevant to building rapport or reaching
sales closure with buyers.
As more case studies reveal its practicality in marketing decision making, the
authors believe more firms will embrace the power of business psychographics.
RESEARCH AGENDA
This paper provides a current snapshot of how far the field of psychographics has
progressed in B2B settings. From its origins in consumer behaviour research nearly
forty years ago, few would debate that psychographics has become a well accepted
segmentation method particularly in consumer markets. Customer profiling has
advanced to a point where entire product launch campaigns are designed around
complex personality profiles. Companies such as BellSouth, Best Buy, Ikea and
Porsche use psychographics as a basis for their target market strategies.
Just as consumer psychographics evolved from a practical and insightful segmentation
tool for advertising profiling to the entire marketing mix, adoption in the B2B sector
will likely spread beyond its roots in selling and product adoption. Some research
possibilities include using business psychographics in marketing research to improve
response rates by profiling likely participants, web and field-based customer service
applications, pricing/value and price sensitivity studies, creating online communities
of customers, supply-chain management and global marketing practices such as sales
negotiations.
A widespread acceptance of B2B psychographics seems to be most impeded
by lack of awareness and knowledge by managers, insufficient tangible evidence
of successful performance and traditional corporate planning structures. Beyond
its limited exposure in scholarly marketing journals, psychographics has been the
purview of consumer advertising boutiques and syndicated lifestyle researchers such
as SRI international and the Yankelovich Monitor. We hope this article will heighten
335
336
JMM
the awareness of this segmentation approach by B2B marketers and encourage other
marketing scholars to do work in this area. Developing valid and reliable measurement
scales for the innermost nest on buyer motivation, risk management behaviour and
relationship style (see Figure 1) is a logical point of departure.
For psychographics to establish a strong foothold in the B2B marketing arena,
systems must be designed to marry product plans and promotion campaigns to the vital
benchmarks used by marketing managers. For example, unless corporate executives
allocate their operating plan resources in line with psychographically defined market
opportunities, such a segmentation model will remain as only an interesting tool for sales
training sessions. With the continued adoption of customer relationship management
(CRM) databases, however, systems for tracking sales results (market share and share of
customer) by psychographic segments are now in place. This makes it much easier for
marketers to plead their case for success in performance evaluations. Hence, research
on relating significant business psychographic variables to marketing metrics (e.g. via
the marketing dashboard concept) is an important topic for investigation.
In addition to the measurement and tracking challenges, corporate planning groups
may be hesitant to adopt a psychographic-based strategic orientation -- in large part,
this is due to accountability and business definition challenges. Often, businesses base
their compensation systems on sector or SBU performance. Simkin (2004) suggests
that many companies do not understand the true essence of segmentation and fail to
distinguish business sectors (sectorisation) from market segments.
Dibb and Simkin (2001) encourage additional marketing scholarship on B2B
psychographics to overcome infrastructure, process and operations problems.
Infrastructure issues occur prior to undertaking segmentation. Relevant research
topics include corporate commitment (personnel, financial resources and top
management buy-in); overcoming resistance to new ways of segmenting markets; and
customer focus. Procedural issues occur during the segmentation process. Here we
are concerned with specifying the segmentation design, data collection and analysis,
training, communication within the organisation and potential strategic fit. Finally,
operational issues facilitate segmentation implementation. Possible areas of study
include the changes to corporate culture and systems, the value of a segmentation
champion, rolling out segment solutions and monitoring performance.
While we acknowledge that these segmentation implementation barriers may be
evident in all types of studies, they are more likely to be pronounced in psychographic
research since this is typically a new endeavour for B2B marketers. As the Collins
Aviation Services case illustrates, the time is now to turn business psychographics
from a nice idea to a real-world solution for increasing segment-specific business
performance.
ACKNOWLEDGEMENTS
The authors thank two anonymous reviewers and the co-editors for their valuable
input and insights in this article.
REFERENCES
Alessandra, T. (1996), The Platinum Rule, Insight, Vol. 165, pp. 20-24.
Arrindell, W. A., Hatzichristou, C., Wensink, J., Rosenberg, E., van Twillert, B., Stedema, J.
and Meijer, D. (1997), Dimensions of National Culture as Predictors of Cross-National
Differences in Subjective Well-Being, Personality and Individual Differences, Vol. 23, No.
1, pp. 37-53.
DeBonis, J. N, Balinski, E. W., and Allen, P. (2003), Value-Based Marketing for Bottom-Line
Success: 5 Steps to Creating Customer Value, New York, NY: McGraw Hill.
Barry, J. and Johnson, W. (2005), Cross-Cultural Buyer Archetypes in B2B Relationships:
An Empirical Study, presented at The Eastern Academy of Management Conference:
Managing in a Global Economy, Cape Town, South Africa.
Berens, L.V. (2001), Understanding Yourself and Others: An Introduction to Interaction Styles,
London: Telos Publications.
Bioinformatics (2004), Marketing to Life Scientists: A Psychographic Analysis, Strategic
Report, pp. 1-201. Excerpt available from The Human Side of Science: What is the
Archetypal Researcher Personality at: http://www.genengnews.com/articles.
Boe, J. (2006), Use Personality Analysis to Present and Sell, Manage Smarter, Vol. 1214, pp.
1-5. Paper available at: http://www.johnboe.com/articles/principles_of_persuasion.html.
Bonoma, T. V. and Shapiro, B. P. (1983), Segmenting the Industrial Market, Lexington, MA:
Lexington Books.
Cameron, K. S. and Freeman, S. J. (1991), Cultural Congruence, Strength and Type:
Relationships to Effectiveness. In: Woodman, R. W. and Pasmore, W. A. (eds.), Research in
Organizational Change and Development, No. 5, Greenwich, CT: JAI Press, pp. 23-58.
Cardozo, R. N. (1968), Segmenting the Industrial Marketing: A New Measure of
Responsibility for Marketing, Proceedings of the American Marketing Association Fall
Conference, American Marketing Association, Chicago.
Christ, P. (1997), Segmenting Resupplier Markets: A Multi-Level Approach, Journal of
Segmentation in Marketing, Vol. 1, No. 1, pp. 75-94.
Cooper, M. J., Wakefield, K. L. and Tanner, J. F. (2006), Industrial Buyers Risk Aversion and
Channel Selection, Journal of Business Research, Vol. 59, No. 6, pp. 653-661.
Deal, T. E., and Kennedy, A. A. (1982), Corporate Cultures: The Rites and Rituals of Corporate
Life, Reading, MA: Addison-Wesley.
Demby, E. H. (1989), Psychographics Revisited: The Birth of a Technique, Marketing News,
January 2, pp. 21.
Deshpande, R., Farley, J. U. and Webster, F. E. (1993), Corporate Culture, Customer
Orientation and Innovativeness in Japanese Firms, Journal of Marketing, Vol. 57, No. 1,
pp. 23-27.
Dibb, S. and Simkin, L. (2001), Market Segmentation Diagnosing and Treating the Barriers,
Industrial Marketing Management, Vol. 30, No. 8, pp. 609-625.
Doney, P. M., Cannon, J. P., and Mullen, M. R. (1998), Understanding the Influence of
National Culture on the Development of Trust, Academy of Management Review, Vol. 23,
No. 3, pp. 601-620.
Easingwood, C. and Koustelos, A. (2000), Marketing High Technology: Preparation,
Targeting, Positioning, Execution, Business Horizons, May/June, pp. 27-34.
Fine, S. H. (1991), Buyer and Supplier Psychographics in Industrial Purchase Decisions, Journal
of Business and Industrial Marketing, Vol. 6, No. 1/2, pp. 49-58.
File, K. M. and Prince, R. A. (1996), A Psychographic Segmentation of Industrial Family
Businesses, Industrial Marketing Management, Vol. 25, No. 3, pp. 223-234.
Giarrantana, M. S. and Torres, A. (2007), The Effects of Uncertainty Avoidance on Brand
Performance: Marketing Creativity, Product Innovation and the Brand Duration,
Economics Working Papers 1015, Department of Economics and Business, Universitat
Pompeu Fabra.
Gregory, G. D. and Munch, J. M. (1996), Reconceptualising Individualism-Collectivism in
337
338
JMM
Consumer Behaviour, Advances in Consumer Research, Vol. 23, No.1, pp. 104-109.
Handy, C. (1995), Trust and the Virtual Organization, Harvard Business Review, Vol. 73,
No. 3, pp. 40-50.
Hart, S. and Lass, P. (2004), National Cultures, Values, Lifestyles Influencing Consumers
Perception Towards Sexual Imagery in Alcohol Advertising: An Exploratory Study in the
UK, Germany and Italy, Journal of Marketing Management, Vol. 20, No. 5-6, pp. 607623.
Hofstede, G. (2001), Cultures Consequences: Comparing Values, Behaviours, Institutions, and
Organizations Across Nations, 2nd edition, Thousand Oaks, CA: Sage.
Hofstede, G, (1998), Attitudes, Values and Organizational Culture: Disentangling the
Concepts, Organization Studies, Vol. 19, No. 3, pp. 477-492.
Hofstede, G (1994), Cultures and Organizations: Intercultural Cooperation and its Importance
for Survival, London: Harper Collins Publishers.
Hofstede, G (1980), Cultures Consequences: International Differences in Work-Related Values,
Beverly Hills, CA: Sage.
Keirsey, D. (1998), Please Understand Me II: Temperament Character Intelligence, Del Mar,
CA: Prometheus Nemesis Book Company.
Kotler, P. and Keller, K. L. (2009), Marketing Management, 13th edition, Upper Saddle River,
New Jersey: Pearson Prentice-Hall.
Kuenne, C.B. (2000), Segment-Based Marketing: From Dream to Reality, Pharmaceutical
Executive, October, pp. 54-68.
Litvin, S. W., Crotts, J. C. and Hefner, F. L. (2004), Cross-Cultural Tourist Behaviour: A
Replication and Extension Involving Hofstedes Uncertainty Avoidance Dimension, The
International Journal of Tourism Research, Vol. 6, No. 1, pp. 29-37.
Marston, W. M. (1929), Bodily Symptoms of Elementary Emotions, Psyche 10, October:
pp. 70-86.
McCarty, J. A. and Hattwick, P. M. (1991), Cultural Value Orientations: A Comparison of
Magazine Advertisements from the United States and Mexico. In: Sherry, J. and Sternthal,
B. (eds.), Advances in Consumer Research, Provo: Association for Consumer Research, Vol.
19, p. 34-38.
McDonald, M. and Dunbar, I. (2005), Market Segmentation: How to Do It, How to Profit It,
Oxford UK: Elsevier Butterworth-Heinemann.
Merrill, D. W., and Reid, R. H. (1981), Personal Styles and Effective Performance: Make Your
Style Work for You, Radnor, PA: Chilton Book Company.
Miller, R.B., Williams, G. A. and Hayashi, A. M. (2004), The 5 Paths to Persuasion: The Art of
Selling Your Message, New York: Warner Business Books.
Mitchell, V. W. (1994), Problem and Risks in the Purchase of Consultancy Services, The
Services Industries Journal, Vol. 14, No. 3, pp. 315-339.
Mitchell, V. W. and Wilson, D. F. (1998), Balancing Theory and Practice: A Reappraisal of
Business to Business Segmentation, Industrial Marketing Management, Vol. 27, No. 5, pp.
429-445.
Myers, I., McCauley, M. H., Quenk, N. L. and Hammer, A. L. (1998), A Guide to the
Development and Use of the Myers-Briggs Type Indicator, 2nd edition, Palo Alto, CA:
Consulting Psychologists Press.
Neal, W. D. (2002), Shortcomings Plague the Industry, Marketing News, September 16,
2002, p.37.
Nijmeijer, M., Worsley, A. and Astill, B. (2004), An Exploration of the Relationships Between
Food Lifestyle and Vegetable Consumption, British Food Journal, Vol. 106, No. 7, pp.
520-533.
Peppers, D. and Rogers, M. (2004), Managing Customer Relationships: A Strategic Framework,
Hoboken, NJ: John Wiley & Sons, Inc.
Plank, R. E. (1985), A Critical Review of Industrial Market Segmentation, Industrial
Marketing Management, Vol. 14, May, pp. 79-91.
Quinn, R. E. (1988), Beyond Rational Management, San Francisco, CA: Jossey-Bass.
Rangan, V. K., Moriarty, R. T., and Swartz, G. S. (1992), Segmenting Customers in Mature
339
340
JMM
Journal of Business and Industrial Marketing, and Academy of Marketing Science and
American Marketing Association Educator Conferences.
Corresponding author: James Barry, D.B.A., Huizenga School, Nova Southeastern
University, 3301 College Avenue, Carl De Santis Building, Fort Lauderdale, FL
33314-7796, USA.
T +001 954 262 5145
F +001 954 262 3965
E jmbarry@huizenga.nova.edu
Art Weinstein is Professor and Chair of Marketing in the H. Wayne Huizenga School of
Business and Entrepreneurship at Nova Southeastern University. He earned his Ph.D. in
Marketing from Florida International University. As the author of six books and more
than seventy scholarly articles and papers, his two latest books include the Handbook
of Market Segmentation, 3rd edition (Haworth Press 2004) and Superior Customer
Value in New Economy (CRC Press, 2004). Dr. Weinstein teaches a variety of courses
with a customer-oriented, marketing strategy focus. These include Delivering Superior
Customer Value, Marketing Strategy, Buyer Behaviour, and Market Segmentation. In
addition, he has consulted for leading high-tech manufacturers, publishers, service
firms, universities, government agencies, and trade associations.
Professor Art Weinstein, Ph.D., Huizenga School, Nova Southeastern University,
3301 College Avenue, Fort Lauderdale, FL 33314-7796, USA.
T +001 954 262 5097
F +001 954 262 3965
E art@huizenga.nova.edu