-- Originally posted on Medium --

In an era where data informs every aspect of business strategy, truly understanding consumer behavior is more crucial than ever. Traditional segmentation methods have given us broad strokes, focusing largely on digital footprints and demographic categories. However, they often overlook the intricate details of how and where consumers actually spend their time.

That’s where GeoPersona comes in, offering a fresh lens on consumer behavior by harnessing the power of geospatial intelligence. This introduction marks the beginning of a series exploring how GeoPersona can be applied across a range of industries, providing a detailed comparison with traditional tools.

Understanding GeoPersona

GeoPersona introduces a transformative approach to understanding market dynamics by leveraging geospatial data to uncover actual consumer behavior and mobility patterns. Traditional analytics methods often depend on self-reported data or online browsing patterns to infer consumer interests. While these can provide a baseline understanding, they fall short of capturing the depth of consumer intent. GeoPersona differentiates itself by focusing on the physical locations consumers visit, thereby offering a more direct measure not only of their interests, but also of their intentions.

This innovative approach centers on the principle that the places people choose to spend their time offer insightful clues into their preferences, lifestyles, and purchasing behaviors. For instance, frequent visits to high-end retail areas might indicate a preference for luxury goods, while regular attendance at sporting events suggests a keen interest in sports. GeoPersona meticulously analyzes these visitation patterns to determine where these interests manifest in the physical world — whether it be a consumer’s favored dining establishment, retail outlet, or recreational venue.

By integrating the “where” with the “how often,” GeoPersona constructs a multidimensional profile of consumer segments. This not only illuminates the types of products and services people are genuinely interested in but also highlights their commitment to these interests, as evidenced by their spending of time and resources. Such granularity enables businesses to tailor their marketing strategies more effectively, ensuring that their messaging resonates with the right audience at the right time. For example, a brand could identify potential customers with a high propensity to purchase fitness equipment by analyzing patterns of visits to gyms or health food stores, rather than relying on broader, less specific indicators of interest.

Furthermore, GeoPersona’s data-driven insights facilitate a strategic alignment between a business’s offerings and the actual needs and desires of its target audience. By bridging the gap between assumed interests based on online behaviour and confirmed interests demonstrated through real-world actions, businesses can enhance their engagement strategies, optimize their product placements, and, ultimately, foster deeper connections with their customers. In doing so, GeoPersona not only serves as a tool for market analysis but also becomes a catalyst for creating more personalized, impactful consumer experiences.

GeoPersona in action: a use case for luxury car segmentation

Imagine an upscale automotive brand looking to expand its footprint in Rome, a city where fashion and luxury are not just industries, but part of the cultural fabric. The brand’s goal is clear: to identify and engage with potential buyers who not only show a keen interest in luxury cars, but also possess the purchasing power to own one.

Context: the luxury car company

The company specializes in high-performance luxury vehicles. The challenge lies in effectively identifying the “who” and “where” of potential customers.

The use case: targeting the Romans that are interested in luxury cars

The use case revolves around pinpointing potential buyers who are not just car enthusiasts, but are likely to purchase a luxury vehicle. The company needs more than just broad demographics; they need a tool that can sift through the population and highlight those with a propensity for luxury automotive investment.

How GeoPersona addresses the challenge

Step 1: Segment Identification

We start by analyzing mobility data across Rome, focusing on locations associated with the automotive segment — car dealerships, service centers, auto shows, and more. The system then identifies postal codes with higher frequencies of visits to these automotive-related points of interest, aggregating this data to define a segment of “Automotive Shoppers.”

Step 2: Focus on Luxury Car Segment

Within the broader category of Automotive Shoppers, we segment further to identify “Luxury Automotive Shoppers.” This is achieved by looking specifically at visitation patterns to luxury car dealerships and events, such as those selling or showcasing brands like BMW, Audi, and Mercedes-Benz, and focusing on postal codes where visits to luxury car dealerships overlap with high purchasing power.

The aggregated data reveals certain postal codes in Rome where “Automotive Shoppers” with high purchasing power are most concentrated. GeoPersona provides insights on the best locations for the company to launch targeted advertising campaigns, host events, or open new dealerships.

Step 3: Strategy Implementation

Based on GeoPersona’s insights, the company can implement highly targeted marketing strategies. For instance, they might host exclusive test drive events in the identified postal codes, or partner with local luxury lifestyle businesses to offer joint promotions.

Step 4: Measuring Impact

Finally, the company can measure the impact of implemented strategies by monitoring any changes in visitation patterns to the luxury dealerships and events in the targeted postal codes, providing a feedback loop for continuous improvement of marketing efforts. Looking at a few luxury car dealerships, we can observe a general increase in footfall to these locations.

By leveraging GeoPersona, the company gains a high-definition view of its market, not through a broad lens but with a targeted scope that reveals the most promising prospects for their luxury vehicles. This tailored approach ensures that marketing efforts are directed effectively, resonating with an audience poised for conversion.

Advantages over traditional segmentation

The limits to traditional segmentation

Traditional segmentation methods have played a crucial role in shaping marketing strategies for decades. However, as the marketplace evolves and consumer privacy becomes a greater concern, these methods are facing increasing limitations.

Surveys, for example, have been a staple in understanding consumer preferences. Yet they come with a notable caveat: People often respond based on how they perceive themselves or wish to be perceived, not necessarily how they actually behave. The “social desirability bias” can skew results, leading to decisions based on aspirational rather than actual consumer behavior. Moreover, the static nature of survey data means it quickly becomes outdated, failing to account for the evolving nature of consumer preferences and lifestyle changes.

Online tracking, particularly through cookies, has been another common tool for segmentation. By tracking website visits, marketers infer interests and intent. However, these inferences are often tenuous — the mere visit to a website does not always equate to a strong intent to purchase or engage with a brand. Plus, cookie-based tracking is under intense scrutiny. With web browsers phasing out third-party cookies and regulations like GDPR and CCPA empowering users to protect their data, the effectiveness and legality of cookie-based tracking are diminishing.

Additionally, the inherent nature of online behavior presents its own challenges. Online activities are vast and varied, creating a fragmented picture of consumer interests. It’s difficult to discern the depth of interest behind a click or a page view, and online actions can be impulsive or non-committal. This dilutes the strength of online tracking in determining consumer segmentation, as digital footprints don’t always translate into meaningful insights or sales.

In contrast to these traditional methods, GeoPersona offers a way to navigate in the face of these constraints. By leveraging geospatial data, we obtain a transparent view of consumer behavior that is grounded in physical presence and movement. This method overcomes the limitations of self-reporting and the fleeting nature of online engagement. Instead of relying on what consumers say or the scattered traces of their online activity, GeoPersona observes what people actually do — the most powerful indicator of intent and interest.

This comprehensive perspective allows businesses to discern the depth of consumer interests and their purchasing intentions, enabling precise targeting and resource allocation. For example, by identifying consumers who frequently visit coffee shops or fitness centers, GeoPersona can segment them into lifestyle-based categories such as “Coffee Lovers” or “Health-Conscious”, providing businesses with actionable insights for tailored marketing strategies.

Occasional behaviors, like visits to car dealerships or home improvement stores, signal significant purchasing intent associated with major life events. GeoPersona captures these moments, offering businesses the opportunity to engage with consumers when they are most receptive to relevant products and services. Seasonal visitation trends further refine this segmentation, allowing for the anticipation of demand surges in retail, gardening, or holiday shopping, facilitating timely and resonant marketing campaigns.

GeoPersona’s real-world data can also refine audience targeting for digital campaigns. By understanding the physical locations of their digital audiences, brands can deliver online content that resonates with their consumers’ offline lives, such as ads for hiking gear to someone who frequently visits outdoor shops and nature reserves.

Privacy at its heart

In the field of consumer analytics, traditional methods have often involved gathering extensive personally identifiable information (PII) to build detailed consumer profiles. This could include sensitive data such as names, addresses, and purchase histories. The aim has been to tailor marketing efforts as closely as possible to the perceived desires and characteristics of individuals. However, this reliance on PII is fraught with challenges, especially as consumer data protection laws become more stringent and individuals grow more cautious about their privacy.

As societies become increasingly privacy-focused, handling PII is becoming more complex and risky for businesses. Data breaches can have severe consequences, not only in terms of penalties but also in damaging consumer trust. Furthermore, laws like the EU’s GDPR or the CCPA in California require businesses to implement robust data protection measures and to be transparent about how they use consumer data. These regulations make the use of PII more challenging and limit the methods businesses can employ to collect and analyze consumer data.

In this evolving context, GeoPersona’s privacy-centric approach to consumer segmentation is not only innovative but also essential. By aggregating and anonymizing data, GeoPersona minimizes the privacy risks associated with traditional methods. This process involves stripping away personal identifiers from the data and analyzing patterns and trends at a group level rather than at the individual level.

Conclusion

GeoPersona utilizes geospatial intelligence to provide a nuanced understanding of consumer behavior, focusing on the actual movements and interactions of groups of individuals. This method allows for the creation of detailed consumer segments based on observed behaviors, offering insights into interests or purchase intent. The use of anonymized and aggregated data ensures privacy compliance while still delivering meaningful analysis. By capturing real-world consumer activities, GeoPersona presents an approach to market research that emphasizes accuracy and relevance, aiding businesses in developing informed strategies for engaging with their target audiences.

Check out our docs page to learn more about GeoPersona, and book a call with a data expert to discover how we can empower your business with location intelligence today.