Blog and Ideas
July 11, 2012
By Daniel Gómez

The Popularity Paradigm: The New Challenge Facing Facebook

No organization can be all things to all people in the way that Facebook has tried to be.

The Popularity Paradigm:  The New Challenge Facing Facebook

Open any newspaper and you’ll find an article about the alleged demise of Facebook, once the darling of the Internet world. Clearly Facebook is facing an uphill battle to regain control of social media, but the reality is that Facebook has become a victim of its own success.

What made Facebook so popular was the fact that it offers a little something for everyone. As the social media giant grew, so did the services Facebook offered until it began to confuse and alienate the very people who it had first attracted.  Now that the Internet is full of specialized social networking alternatives, Facebook, once called “the social network with everyman appeal” may well have become the pariah of the social world.

Why? In short, no organization can be all things to all people in the way that Facebook has tried to be. Instead, companies perform much better when they provide an excellent product to a select group of loyal customers who don’t jump ship at the first sign of stormy weather.

As simple as it sounds, this is basis of customer segmentation.

But what is customer segmentation? It is the division of potential customers into groups that share multiple features. Customer segmentation is a powerful tool that can help companies identify and be responsive to customer needs more quickly than their competition resulting in a significant market advantage.

Companies can use customer segmentation as the primary basis for the allocation of resources such as product development, internal communications and service delivery programs.  It can help company managers to develop effective marketing campaigns to extract maximum value from a select group of potential customers.

Companies that invest time and resources in identifying customer segments will be able to outperform their competition by developing customized solutions in the form of services and / or products.

For example:

• Dividing the market into significant and measurable segments according to customer needs, past behavior or demographic profiles.

• Determining the profit potential of each segment by analyzing income and the cost of serving each segment.

• Targeting segments according to their earning potential and ability of the company to meet their needs.

• Investing resources to adapt programs for products, services, marketing and distribution to meet the needs of each segment.

• Measuring the performance of each segment and adjusting the segmentation approach to market conditions to enable strong decision-making throughout the company.

Daniel Gomez is Director of Brand Strategy at Mijo! Brands of Mexico.

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