Axel J. Leichum, Partner at Blue Canyon Partners, Inc. hosted a webinar for nearly 150 attendees and discussed the topics of: why segmenation matters, the benefits of needs-based segmentation, why it's not just for end customers, multi-stakeholder environments, how to measure if your current segmentation is effective, and best practices for developing and implementing segmentation. For complete information on needs-based segmentation, please contactus@bluecanyonpartners.com.

1. © 2017 Blue Canyon Partners, Inc. All rights reserved.
Webinar
April 2017
Needs-Based Segmentation:
Lessons from the Field

2. © 2017 Blue Canyon Partners, Inc. All rights reserved.
Presenter
Axel J. Leichum
PARTNER, BLUE
CANYON PARTNERS
T (847) 967-0253
E ajl@bluecanyonpartners.com
2
 15+ years as a management consultant
 Expertise across a wide variety of industries: IT hardware and software,
wholesale distribution, electrical equipment, healthcare, personal and commercial
vehicles, HVACR equipment, alternative energy, automation, and distributed
power equipment among others
 Experience executing projects with a focus on both developed markets and
emerging markets
 Key areas of interest: adjacent markets, pricing strategy, segmentation, and
disruption

3. © 2017 Blue Canyon Partners, Inc. All rights reserved.
About Blue Canyon Partners
3
Marketing & Customer Strategy
Focus Areas:
Adjacencies
Business Models
Mergers & Acquisitions
B2B Brand
Customer Focus
China Growth Strategy
We are:
A management consulting firm that
provides business-to-business executives
strategic direction on how to drive
profitable growth
We position our clients for success by
helping them:
 Identify and take advantage of new
growth opportunities
 Discover how to create and capture
more value from existing businesses
Segmentation & Value Prop
Product/Offering
Pricing
Channel
Major Customers
Corporate & Business Unit Strategy

4. © 2017 Blue Canyon Partners, Inc. All rights reserved.
Topics
4
 Why segmentation matters
 Benefits of needs-based segmentation
 Its not just for end customers
 Multi-stakeholder environments
 Is my segmentation effective?
 Best practices for developing and implementing
segmentation

5. © 2017 Blue Canyon Partners, Inc. All rights reserved.
Why segmentation matters
5
Is the foundation
of a successful
growth strategy…
 Opportunities
 Where to Target
 How to Win
Delivers top line
and bottom line
improvements…
 Faster Growth
 Higher Margins
 Higher Return
on Investment
 Higher
Productivity
Effective
Segmentation
Companies can survive without good
segmentation but they rarely thrive

6. © 2017 Blue Canyon Partners, Inc. All rights reserved.
Topics
6
 Benefits of needs-based segmentation
 Its not just for end customers
 Multi-stakeholder environments
 Is my segmentation effective?
 Best practices for developing and implementing
segmentation

7. © 2017 Blue Canyon Partners, Inc. All rights reserved.
Classify customers and define
segments based on common set of
needs (met or unmet) and/or
purchase behaviors
Needs-based
Segmentation
Benefits of needs-based segmentation:
definition
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Cost DrivenHigh
Performance
Efficiency
Focused
Example of Needs-based
Segmentation

8. © 2017 Blue Canyon Partners, Inc. All rights reserved.
Benefits of needs-based segmentation:
a case study
8
Customer
Categories
Traditional Category
Segmentation
Customer Needs
and Behaviors
Segments defined
based on…
• Performance
• Price
• Efficiency
• Etc.
Assigned…
• Industry
• Size
• Etc.
 Finance
▫ Large Data Center
▫ Medium Data Center
▫ Small Data Center
 Government
▫ Large Data Center
▫ Medium Data Center
▫ Small Data Center
 Retail
▫ Large Data Center
▫ Medium Data Center
▫ Small Data Center
 Etc…
IT Hardware Access and Control Equipment
Provider
Existing segmentation
Challenge
 Core offering was being replaced in certain situations by similar
integrated capabilities within the IT hardware
 Needed to focus on where offering would still be valued
 Existing segmentation unhelpful; no consistent patterns in
increasing or decreasing sales/interest by vertical or size
 Company could not effectively target its offering

9. © 2017 Blue Canyon Partners, Inc. All rights reserved.
Benefits of needs-based segmentation:
a case study
9
Customer Needs
and Behaviors
Needs-Based
Segmentation
Segments defined
based on…
• Industry
• Size
• Operations
• Sophistication
• Processes
• Etc.
Identified by…
• Performance
• Price
• Efficiency
• Etc.
New needs-based segmentation
Benefits
 Clearly identify target customers for core offering focus (reduction
in sales decline by 10%)
 Discovery of several additional approaches to drive growth
▫ Better serve Multi-Tool Users with new core product designs
that incorporate integrated access and control technology
▫ Surfaced unmet need among the New Technology Adopters for
better management of dispersed integrated access and control
technology leading to development of management software
offering ($400M opportunity)
New
Technology
Adopters
Cost &
Functionality
Multi-Tool
Users
Reliability &
Redundancy
Alternative
Product
Advocates
Simplicity
Core
Product
Loyalists
Compatibility
& Ease of Use
Customer
Characteristics
IT Hardware Access and Control Equipment
Provider

10. © 2017 Blue Canyon Partners, Inc. All rights reserved.
▫ Greater clarity on different types of customers in the market
▫ Easier to identify who to target given company’s capabilities and
strengths
▫ Easier to define value propositions and offerings (pricing, new
products, channels, etc.) to effectively serve different customers
▫ Easier to develop messaging and marketing collateral
Benefits of needs-based segmentation
10
“How do we win with Multi-Tool Users” provides much
greater clarity to the organization than “how do we win with
Medium Sized Finance Data Centers”

11. © 2017 Blue Canyon Partners, Inc. All rights reserved.
Topics
11
 Its not just for end customers
 Multi-stakeholder environments
 Is my segmentation effective?
 Best practices for developing and implementing
segmentation
For complete information on Needs-Based Segmentation,
Please contactus@bluecanyonpartners.com