Small Car Market Segmentation

A leading auto manufacturer

A major auto manufacturer was interested in segmenting the small car market in order to target key segments for two new vehicle models. RSG worked with the client to develop an online survey to understand the attitudes and preferences of qualifying small car purchase intenders. We used latent class modeling to segment the market (a process that is a great example of art and science) and identified several distinct and targetable segments for the two vehicle models. Interestingly, the segments identified did not completely line up with the client’s hypotheses.

In order to confirm and learn more about these segments, segment members were invited to focus groups to better understand their needs, preferences, and reactions to potential marketing stimuli.

The study gained great traction in the company and is viewed as an insightful and actionable window to the small car market. It was especially valuable that RSG’s segmentation revealed some inaccuracies in the client’s hypothesized targets.

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