VITAMINS:
Global Segmentation Approach Drives Marketing Effectiveness and Efficiency

Client Situation

The over-the-counter vitamins/supplements market is a mature one, and global growth has been flat for some time. Our client-a leading global player, competing in over 40 countries-had actually been experiencing declining sales, and believed their OTC brand portfolio was under-performing. On their four global brands, the client was seeing inconsistent marketing efforts by independent affiliates around the world, and had encountered difficulty in trying to centralize some key functions that had historically been decentralized. Senior management aspired to building global brands with truly global strategies, and sought a marketing framework that could accelerate growth to double-digit rates within five years. But what were the barriers to growth, and what would the key growth drivers be? Was there a way to rationalize the positioning of each brand to optimize competitiveness and motivate specific behaviors among specific consumers? And would a global approach work, or would this require completely decentralized, market-by-market, local solutions?

Results

The client's partnership with Market2Customer^® (M2C^®) resulted in an entirely revamped global marketing approach, and paved the way for enhanced global marketing capabilities and brand growth. Affiliates across the world are now aligned against an actionable, relevant global segmentation for the vitamins category that guides target market decisions for the global brands, and identifies the growth opportunities for local brands. Greater consistency in analysis and data collection across affiliates has provided marketing efficiencies, and enhanced focus for product development efforts. The global brand leaders have reestablished credibility among affiliates around the world, facilitating application of uniform brand positionings that set the corridors for local action plans and reinforce brand meaning across an increasingly mobile and global consumer base.

The Intervention

Working collaboratively with the appropriate client teams, the M2C team first worked to diagnose the barriers to growth. The team quickly recognized that there was no unifying brand positioning or identity for the client's global brands across markets. Furthermore, each of the client's brands had developed its own market segmentation approach, based largely on intuition. These product-based, attitudinal segmentation schemes included very narrow definitions of the competitive set (i.e., only those competitors in the same product category), provided no framework for the overall vitamins category, included significant overlap across segments, and appeared to be basically unhelpful.

Utilizing M2C GrowthPath^® approach and Action Segmentation^® process, the joint M2C and client team was able to redefine the vitamins market and hypothesize a new consumer segmentation approach. Potential segmentation variables were tested for both local and global "meaningfulness" and "actionability," using a cross-section of countries across the world. The resulting global segmentation frame proved to be a powerful and actionable predictor of key differences in behavior across the individual countries, as the segments shared similar motivations and behaviors globally. The team then brought each consumer segment to life by developing Consumer Portrait^® frameworks for all segments, providing insights about target consumers and potential growth opportunities the client had never before seen.

The global segmentation and Consumer Portrait frames led to a dramatic change in the way the client positioned and targeted their global brands. Combined with a penetrating analysis of the competitive environment, and an objective assessment of individual brand strengths (utilizing global "benefit ladders"), the team selected a core target segment, as well as spillover segments, for each global brand. They then created refined brand positionings that focused on the target segments' needs and motivations, and emphasized competitive strengths.

Critical to the success of the entire effort was not only the relevance of these global outputs at a local level, but the ability of the local affiliates to apply them to sharpen local action plans. The team worked with individual affiliates to build their capability to validate local growth drivers and barriers, develop local portraits, and to utilize the global brand platforms as guideposts for identifying local growth levers. Local brands, both the client's and local competitors, were added to the analysis, facilitating identification of local growth and new product opportunities.

Today, our client is immersed in implementing global segmentation and global marketing campaigns across its global brand portfolio. This work has galvanized their entire business system around unified brand platforms, reinforcing brand meaning from market to market, providing powerful synergies between the global and local activation plans, and driving efficiency across the marketing mix. A system that historically was characterized by fragmentation and inconsistency in messaging and activities is now remarkably aligned against common growth opportunities and brand levers. This will be a continuing process, but one which should provide a foundation for sustained growth well into the future.

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