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 / Third Quarter 2001 / Issue 24(originally published by Booz & Company)


Seize the Occasion! The Seven-Segment System for Online Marketing

None of the seven usage occasion types was dominant in our study. (See Exhibit 2.) Marketers and retailers are likely to encounter users engaged in all types of sessions, so they should consider how to reach people in all segments.

Why Usage-Based Segmentation?
To visualize the difference between usage-based segmentation and user-based segmentation, consider your own activity on a typical day. You work. You dine. You relax with friends and family. You read. You watch TV. It gets more intricate: Sometimes when you watch TV, you switch from channel to channel, whereas at other times, you are engaged intently with one show, for an hour or more. So, too, when you shop: Sometimes, you browse aimlessly; sometimes, you have a specific goal. These different behavior patterns are what we call usage occasions.

This is not a startling insight; as noted, offline marketers apply the concept of usage occasions all the time. Think about how food-service companies respond to your eating habits. Even though your demographic and psychographic characteristics don’t change, your mood does, so over the course of a week, one night you grab a burger at a diner, the next you have an expensive dinner with a client, and on the weekend you pick up some hot-and-sour soup for a stay-at-home meal. You choose a destination — fast-food restaurant, three-star boîte, or local takeout place — that fits your current mood and needs. The challenge for food-industry executives is to decide which occasions they want to serve. They must create formats and brands that accommodate the widest coherent range of eating occasions. At the extreme you can see how occasions don’t mix — a convenience store with a fancy dining room in the back simply isn’t practical.

The same fluid behavior patterns appear online. In applying our usage-based segmentation model to the Web, we stripped away the demographic, attitudinal, and behavioral faces of the user, and looked strictly at occasions and the behavior therein. This approach yielded the seven sharply drawn session types. People engaged in these usage occasions promiscuously; indeed, 44 percent of our sample exhibited, at one time or another, all seven patterns, and fully two-thirds showed up in five or more session types. By contrast, only 12 percent engaged in one session type at all times. (See Exhibit 3.)

At first glance, separating the user from the usage occasion appears merely to underscore the frequency of common forms of behavior. None of the session types is dominated by a single demographic group. Girls ages 12 to 17 are just as likely to engage in a Loitering session as are professional men ages 30 to 50. Of course, there are still important differences in what various groups of consumers do in similarly constituted sessions. Whereas Loitering girls may be interested in looking up entertainment sites with the latest gossip on the teen idol Ricky Martin or the Backstreet Boys, the middle-aged male Loiterer may be more inclined to linger at his favorite investment site, tallying the week’s impact on his technology stocks.

Yet these common behavior patterns have important implications for marketers, and tactical insights abound when we look closely at the dynamics of the seven usage occasions. By examining how the four session variables (session length, time per page, category concentration, and site familiarity) define the different segments, a marketer can identify behavioral patterns that can help in the creation and placement of communications. Loitering and Surfing sessions, for example, both involve visits to sites with which users are already very familiar. But the occasions’ category concentrations — 66 percent for Loitering and 26 percent for Surfing — show people in Loitering sessions are far more highly focused on a discrete set of categories, whereas people in Surfing sessions engage more in seemingly pointless meandering, skimming through a number of different topics but not getting deeply involved in any one subject. Based on these differences in the pace and breadth of sessions, it’s likely that, depending on the usage occasion in which they are engaged, some people will be open to a range of messages, others will pay attention only to highly targeted messages, and others simply will whiz by anything not directly related to the purpose of their session.

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  1. Robert G. Docters, John N. Grim Jr., and John P. McGady, “Segments in Time,” s+b, First Quarter 1997; Click here.
  2. Horacio D. Rozanski and Gerry Bollman, “The Great Portal Payoff,” s+b, Second Quarter 2001; Click here.
  3. NetRatings Inc.: Click here.
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