Marketers appear to be facing a crisis of confidence. In the ÂÜŔňÉçąŮÍř and Kantar’s recent survey of marketers,[2] respondents’ confidence that their marketing team is doing the right things to drive growth is at its lowest point in the last five years (see Exhibit 1), and only half believe their organization has a clear strategy in place.

Many marketers and strategists consider segmentation to be the foundation of customer-driven (marketing) strategy, and it is often seen as one of the key tools to build a more customer-centric organization. However, while 72% of marketers agree segmentation is pivotal for truly understanding customers, the use of segmentation is often limited to the execution of strategy (messaging/communications, media planning) rather than being a key driver of the strategy itself (see Exhibit 2).

At their best, segmentations provide a single source of truth about the customer, what demand looks like, what customers need, and which needs are not being met. It should drive strategy through coordinated and synchronized execution across the entire organization. Without this unified view of the customer, organizations run the risk that personal biases distort decision making and that decisions across different parts of the organization are not aligned or, worse, conflict with one another. This misalignment will result in poor prioritization and inefficient investment across the organization, further eroding institutional trust in the marketing function.

So what should organizations do to ensure their investment in segmentation delivers broad impact? Our research identified three key principles:

1. Clarify the use cases
2. Look beyond the market today
3. Create new behaviors, not just new learnings

Clarify the Use Cases

Best-in-class segmentations are designed to inform specific use cases and specific commercial objectives so that their impact can be targeted and measured. These use cases can and should go further than solely marketing, powering decisions across product, sales, innovation, and M&A. Similarly, setting clear commercial objectives for the segmentation to feed into is a vital but often overlooked part of the project: When rushed, expectations can be misaligned, leading to the wrong program. Without complete clarity on its intended purpose, the design of the program is often muddled and generic, leading to disappointment:

• 37% of respondents indicate that specific design choices were made to answer precisely the intended use cases.
• 36% of respondents indicate that they are using the segmentation for all its intended purposes.

To solve this, it’s essential to get the input of a broader set of functions beyond just marketing (and especially insights/market research teams) before the program even starts. Understanding the needs of other teams and various levels in the organization is essential: Knowing how they make decisions and how the segmentation will be used is essential to creating the right tool and elevating it from a marketing execution tool to something driving broader organizational strategy and execution.

In those collaborative, multifunctional design discussions, however, it is crucial to be transparent about what the segmentation will and will not do. The best segmentations are deep, rich, multifaceted views of the marketplace rather than shallow catch-all datasets. Few respondents (23%; see Exhibit 3) indicate that stakeholders across teams were aware of what the segmentation would answer. Ensuring clarity from the start means expectations will be aligned, making it easier to embed the framework in the organization’s ways of working.

Look Beyond the Market Today

Businesses need to think beyond the current state of the market with their segmentations or risk missing huge opportunities to leverage them as a central strategic tool in future planning.

Many organizations are not using their segmentation to plan further than a year ahead (41% are only using them for short-term planning). The key pitfalls of this are:

1. The segmentation is not future-proofed in any way.
2. The focus is too narrow, aimed only at where the business plays today.

Segmentations are often unfairly maligned as a static snapshot in time. Great segmentation programs are dynamic, adaptable, and forward-looking. They are smartly designed to:

• Embed key customer and category trends into the program to arm teams with a better understanding of where change could be most profound.
• Integrate into other insight tools (such as tracker studies, social data, or panel data) to ensure an ongoing understanding of what is changing in the market.

Ensuring that the segmentation covers a market that is not too narrowly defined is equally critical. Too often, the segmentation captures a narrow scope, limited to the current (sub)categories the organization operates in, with the belief that a narrower focus means greater efficacy. Additionally, some teams take shortcuts by leveraging approaches that lack credible market sizing, essential for broader business buy-in. Not surprisingly, a mere 8% of respondents say their segmentation improved decisions on expansion opportunities. Broadening the aperture with provocative thinking about adjacent categories and shared consumer needs is critical to avoid missing the potential stretch and white-space opportunities the organization could go after.

Create New Behaviors, Not Just New Learnings

Segmentations are a key tool to drive consumer-centricity across businesses, but a tool alone won’t make change happen. To have an entire organization embrace it, extensive efforts need to be made to properly embed it within each team and integrate it into their ways of working. Many programs fall short on delivering this.

The reason is that embedding is often an afterthought: Only 1 in 3 give embedding significant thought during the design phase. One-off briefing meetings are by far the most common medium for sharing the results of the segmentation. Not surprisingly, only 15% of teams feel more motivated and energized by this approach. This reveals a telling misalignment in how organizations think of segmentations, treating them as a research project aimed at uncovering new insight, not an organizational change project where the goal is establishing powerful new behaviors. The outcome is then very predictable and disappointing, with a lack of understanding and use (see Exhibit 4).

Providing learning programs and inspiration tailored to each use case and reinforced with multiple touchpoints can help teams adopt meaningful changes in their ways of working and unlock significant value for organizations.

Conclusion

With turbulent market conditions and uncertainty likely to remain a key challenge in times ahead, joined-up thinking across teams and clear strategy has never been more important. Segmentations are uniquely placed to meet this challenge, but to do so, there needs to be a shift. They should no longer by viewed solely as an insights project but should be considered an organizational transformation initiative where a consistent and compelling view of the customer is fully ingrained across teams and functions, from business planning to execution.

To deliver this, segmentation must be:

• Forward-looking in terms of both the decisions it needs to drive and the market it will cover.
• More clearly tied to business outcomes rather than research outcomes, integrated as part of key KPIs and commercial objectives.
• Supported beyond the completion of the initial project with an engaging learning plan guiding teams to integrate it as a crucial part of their planning cycle and day-to-day processes.

Segmentations can unlock strategic clarity and drive growth—they just need to evolve.

[1] Segmentation here includes any demand or segmentation framework. For example, it can feature people, occasions, needs, or demand spaces.

[2] Survey among members of the ÂÜŔňÉçąŮÍř in May–June 2025; sample size N = 182.

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In a marketplace reshaped by constant disruption, from global pandemics and inflation to the accelerating march of AI and changing consumer expectations, understanding who your customers truly are has never been more urgent. Additionally, in today’s volatile political and economic climate, customer expectations, needs, and concerns are changing daily. And while segmentation has always been a foundational tool for marketers and insights professionals, it’s now undergoing a much-needed reinvention to better reflect the speed, complexity, and humanity of today’s consumers.

Here’s what’s driving the renewed focus, and how organizations can modernize their segmentation strategies to stay ahead.

Why Segmentation Matters Now More Than Ever

It’s tempting to view segmentation as a “set it and forget it” initiative. But in today’s environment, static segments based on outdated behaviors or assumptions can do more harm than good.

Consumers are not only shifting their values and habits, they’re doing so quickly and in ways that don’t always align with traditional demographic buckets. Work-life routines have transformed. Technology has introduced new touchpoints and expectations. And financial pressures and volatility are rewriting how people define value.

Segmentation helps brands navigate this chaos by anchoring strategies in clarity. It provides the lens to see meaningful differences within your audience, align messaging to motivations, and understand their ups and downs to prioritize efforts based on impact. And it’s powerful: Studies show that that use segmentation report increased sales. But for segmentation to be useful, it needs to evolve beyond legacy approaches.

The Shortcomings of Traditional Methods

Many legacy segmentation studies rely on static data, long-form surveys, and time-intensive processes that can take months to complete. By the time insights are delivered, the market may have already shifted. Even more critically, the outputs often lack emotional depth or contextual nuance, making them hard to activate across teams.

What’s needed is an approach that balances analytical rigor with real-world relevance. That means getting closer to how people actually live, shop, and decide—capturing their stories, not just their statistics.

What Modern Segmentation Looks Like

1. Conversational and mobile-first engagement. Segmentation studies are only as strong as the data they’re built on. And in today’s world, traditional survey methods, such as long, static, email-based questionnaires, often fall short. A modern approach leans into how people naturally communicate: on their phones, in short, intuitive interactions. Mobile chat-based methods not only increase response rates and completion, but they also create a more immersive, candid research experience. The result? Segmentation inputs that are richer, more emotional, and far more reflective of real human behavior.
2. Agile, modular study designs. Segmentation doesn’t have to be a multi-month initiative with a fixed start and end. Modern mobile-based methodologies break long surveys into modular, recontactable touchpoints—using text message-based notifications to seamlessly pick up where you left off. This flexible structure allows researchers to gather foundational data in phases, refine hypotheses midstream, and re-engage specific audience segments as needed. It also makes it easier to iterate, ensuring that segment definitions stay relevant in a fast-changing market.
3. Blending quant with qual—seamlessly. Traditional segmentation takes a linear quant-qual approach to capture audience needs, motivations, behaviors, attitudes, and more. But today’s most impactful segmentations go beyond “math” and incorporate the nuance of qualitative insight. By integrating methods like open-ended responses, video diaries, and projective exercises into the foundational research, not just after segments are defined, researchers can elevate the segmentation beyond simple categorization. These richer inputs shape smarter segments and bring them to life in more compelling ways.
4. AI-assisted analysis with a human lens. The rise of unstructured data in segmentation (videos, images, open text) has created new opportunities for AI to support the analytical process. Tools like AI summarization and sentiment detection can surface patterns quickly, helping researchers get to insight faster. But while AI can accelerate the work, it can’t replace human judgment. The most effective segmentation strategies use AI as a copilot: assisting in theme discovery, enriching cluster definitions, and speeding up the synthesis of large qualitative datasets.
5. Built-in activation pathways. A segmentation is only successful if people across the business can understand and use it. That means thinking about activation from the very beginning. Modern segmentation deliverables go beyond charts and cluster maps—they include dynamic, visual outputs like short-form video profiles, mobile-optimized digital personas, and shareable playbooks that help teams apply insights in real-world decisions. And by building communities around high-value segments, brands can continue learning and adapting long after the initial study is done.

The Path Forward

Segmentation today isn’t just about sorting people into neat little boxes. It’s about truly understanding what makes them tick—and being able to adapt when things shift. And things are shifting fast, all the time.

As new tech, fluctuating government/economic policies, changing values, and evolving expectations reshape how people connect with brands, segmentation has to keep up. With more flexible tools, more human-centered data, and smarter ways to keep the conversation going, segmentation can be faster, deeper, and much more useful. At its best, segmentation doesn’t just help you see your audience; it helps you connect with them. And in a world where connection is everything, that’s more important than ever.

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