The relative merit of two segmentation approaches: executives views and a cost-benefit analysis

Abstract

Purpose This study aims to capture the views of executives about the merit of using the two segmentation approaches (quantitative vs qualitative). Furthermore, this study aimed to examine costs and benefits for two different segmentation approaches, using a minimax simple cost-benefit analysis (CBA) matrix. Design/methodology/approach A total of 16 semistructured interviews were conducted with executives within the University of Sharjah (UoS). Furthermore, a minimax approach was applied to the CBA study. Findings Evidence in this study found that the financial cost of quantitative segmentation approaches was higher than qualitative approaches. However, the decision-makers trusted the quantitative approach more regardless of the incurred costs. The study also found that there was a limited knowledge about social marketing and segmentation among executives. Research limitations/implications Limitations of this study relate to the methodology applied, the sample selected and the lead research. Another factor is selection bias, which limited this study to one organization’s executives. It is conceivable that middle-level management would have had the desire to participate because they make the recommendations to top management in decision-making. The researcher did not collect precise data on time taken to design, implement and analyses the two segmentation studies, which qualified the precision of the CBA. Also, the fact that the sample includes participants from a relatively narrow range of disciplines should be noted as a limitation of the study. Practical implications The current study provides a case study demonstrating how CBA provides a dollar amount estimate permitting alternate segmentation approaches to be compared and contrasted, assisting in the value estimation of any social marketing project. Social implications The paper draws upon two streams of the literature: social marketing and CBA. The paper focused on the understanding of the literature, CBA offers a technique applicable to demonstrating cost savings that can be derived from choosing one method over another. Moreover, CBA assists in understanding the benefits or potential opportunity cost both financially and nonfinancially. Originality/value This paper presents one of the first studies conducting a CBA to compare and contrast two segmentation approaches in social marketing. The study provides interesting insights into the perceptions of management executives over alternative research methods, although the results are limited to a case study.