Business Model Canvas Customer Segments
When it comes onto creating a business plan the customer segments section is probably one of the most important part. Without hungry and excited customers who are willing to go the extra mile to get your product your business won’t survive for long.
Furthermore when you already have customers who are interested in your product that’s just half of the equation. That’s where the customer segments section comes in. The customer segments section will help you to break up your customers into different segments. A huge benefit of this is that it will allow you to create unique value propositions for each segment.
A lot of companies who do not segment out their market are leaving a lot of money on the table. It’s like the process of oil discovery.
You are going to drill down deep into your market and search for new opportunities to serve new customers which will in return give you more profits. For example if you are selling a product and you have a customer base of 100,000 customers. You can do market research which will give you the opportunity to tweak your product to serve higher end customers.
As a result of that you will see an increase in profits. You can even make changes in your product to provide unique features to a certain market segment.
Another huge benefit of why the customer segment section is necessary. Is the fact that it will help you to make radical changes to your overall business strategy.
Examples of these would be making the necessary changes to your customer service’s department to help serve unique segments. Changing up your distribution channels, create different marketing campaigns etc.
You have many different types of customer segments these include niche market, mass market, diversified and multi-sided platforms.
You can see each in more detail below:
When you think about niche markets you are basically going to break up your customer base. Next develop unique value propositions for each specific niche. As a result of this you are going to make changes to your customer relationship. That will help you to serve a particular niche and it will also have an effect on your marketing strategy.
This is the opposite of the niche market. You are going to serve a large number of customers probably even your whole customer base and just group them into one segment. All of them are probably going to have the same problems and needs.
When a company chooses to diversify they are going to serve a totally different set of customers. Probably even customers in a different market with totally different value propositions. Sometimes the company may see a new growth opportunity and they want to capitalize on that.
A multi-sided platform is when you serve two different segments in your market. You would usually see this on retail platforms where they would usually have the sellers on one side and buyers on another.
Or another example would be social networks where you have a user on one side and an advertiser on the other half.
When you are creating a customer segment plan in your business model canvas you must take this section pretty seriously.
Think hard and critical about how you are going to approach serving new markets. It will definitely have a profound effect on your business.