How the humble bacon butty market highlights the need for customer segmentation thinking in your startup strategy

There aren’t many things you can get at a Burger Van, Greggs and The Ritz, but a bacon butty is one of them. It’s a uniquely British phenomenon and an icon of our culture that unites us all in getting our taste buds going. Prince Harry is said to be a fan, which makes me worry for his happiness in the US.

Enjoyed by everyone from building site workers as early morning start-me-ups to students’ hangover cure, bacon knocked cheese off the top spot in a 2020 poll of our favourite sandwich fillings. Ed Miliband may cite that bacon sandwich incident as his main regret about his time as Labour leader, but it’s easy to see why his aides thought it would be a good look for a man accused of being out of touch with the ordinary voter.

We all react the same way to the sound and smell of frying bacon. As chocolate produces the same endorphins as falling in love does, bacon speaks to us all. But whilst we all enjoy eating a bacon butty, we are not quite so unanimous when it comes to deciding how best to make it, or even what to call it. Whilst the ‘bacon plus bread’ formula applies, there is the beauty and variety of the English language to consider too.

Let’s go back to the beginning. Food historians attribute the creation of the sandwich, meat between two slices of bread, to John Montagu, 4th Earl of Sandwich. Montagu, the story goes, was fond of gambling and in one particularly long session requested a meal that he could eat that wouldn’t interrupt his game. The sandwich was born: he could hold it one hand without having to let go of his precious cards in the other.

As for our much-loved bacon butty, it was the fuel for C19th factory workers seeking a speedy breakfast option. Grabbed from a street vendor on their way to work, the soft white bread would contain an egg and meat filling. The meat could vary from sausage to bacon, or when times were really tight, simply a spread of sausage fat.

Now back to the language, and regional differences abound on the composition and definition of what for me is simply, a ‘bacon butty’. If you are from London, you’ll often hear people asking for a bacon sarnie, a simple abbreviation from the Earl himself. Yet travel north to the Midlands and the ask is for a bacon batch.

In the North-East and South Wales you get your bacon bap, a soft bread roll with a healthy squish and minimal crust. If you’re in the North-West you’re more likely to ask for a bacon barm or bacon muffin. Fun fact: the word barm means the froth on top of a fermenting beer, it was traditionally used instead of yeast to rise bread. On the wrong side of the Pennines, and the vernacular is different again. My time at University in Sheffield introduced the bacon scuffler or bacon bread cake as the local delicacy. Moving on, for those living in North Wales it’s the bacon cob.

Interestingly, soft white bread seems to be the preferred choice of bacon connoisseurs in the South, where some folks even cut the crust off, and call them floury bacon rolls. It gets trickier when we head up to Scotland, where, and I’m not sure if this is to believed, apparently it can be called a bacon bridie, buttery or rowie. Really? Anyone from Scotland please feel free to contact me for false representation.

Most strangely given its pleasing alliteration, there doesn’t seem to be that much regional passion around bacon butty, which is how I’ve always known it. The dictionary definition simply citing it as a filled or open sandwich: noun, informal, Northern English which seems to suggest it is a family colloquialism born from our Manchester-Lancashire-Cheshire heritage.

Some celebrity chefs have their own preferences: Paul Hollywood likes them on sourdough (too chewy), Marco Pierre White microwaves his bacon (weird) and Heston Blumenthal toasts just one of the slices of bread and dips the sandwich in burger sauce (rescind his passport immediately) and you’ll have a fight on your hands. I could do on. Should the bacon be back, middle or streaky, thick or thin, grilled or fried, crispy or simply well-done?

There you have it, territorial idiosyncrasies to prescribe meaning and identity around the naming of a humble sandwich, inherent charming and one of our national treasures. I mean it’s all well and good protecting swans but whose looking after the bacon butty? And don’t even get me started on the Americans, who default to a B-L-T and find our fascination with HP sauce extremely odd indeed. But I’m with them there, the action of putting red sauce on bacon, should be considered a heinous crime.

But let’s move on. Imagine your startup idea is Uber Bacon Butty. You see an opportunity to disrupt a fragmented, unstructured, large national market with a higher quality, improved service, delivered by smart, convenient technology and ubiquitous business model. There’s a challenge: it’s not a homogeneous market, as we’ve seen the regional variations demand a more intelligent approach than simply a one-size-fits-all, and a clear understanding of the variety of local customer expectations. This is a challenge.

The key to creating and maintaining successful relationships with your different customer groups is understanding them as individuals by having a customer segmentation strategy. There are a number of reasons why customer segmentation is important for a startup and what it will help you achieve:

  • Learning about your customers on a deeper level so you can tailor your content to their unique needs
  • Creating targeted campaigns to resonate with and convert segments of customers
  • Improving your customer service and customer support efforts
  • Increasing customer retention with customised content and interactions
  • Understanding who your most valuable customers are and why
  • Communicating with segments of customers via their preferred channel or platform.
  • Identifying new opportunities for related products efficiently

When determining how to segment your customers, start with the following strategy:

  • Determine your customer segmentation goals
  • Segment your customers into relevant groups for your business
  • Target and reach your customer segments
  • Analyse your customer segments and make adjustments as required.

1. Determine your customer segmentation goals: the why?

Think about why you need to create a customer segmentation strategy and what you seek to derive from the process. For example, are there particular geographic or demographic customer targets – maybe a major city like Manchester and early morning commuters, a segment based on the propensity to spend in seeking customers who buy three bacon butties a week, or a particular opportunity to attack specific competitors – let’s say you see McDonalds’s breakfast customers as key target market sector.

2. Segment your customers into groups of your choice: the who?

Once you have established your objectives, decide how you’ll segment your customers. For example: 

  • Demographic & Geographic on age, gender, income, location
  • Psychographic – personality, lifestyles and interests
  • Technology – mobile, apps, desktop
  • Behavioural – tendencies and frequent actions, habits and needs
  • Value-based – different economic criteria applied to your overall target market

3. Target and reach your customer segments: the where?

Once you’ve segmented your customers, you need to determine how you’ll target them across your marketing, sales and service activities. For example, let’s say we’re targeting the Manchester 7am to 10am city commute bacon butty customers, in the city centre:

  • Marketing can tailor and customise content to attract, teach, and meet the needs of your Manchester audience members to boost leads and brand awareness. It would be different to city office commuters than for building site workers or students.
  • Sales can identify common traits shared by your most-qualified Manchester customers, as well as best ways to reach out to and communicate with them to increase conversions – for example, pre-ordering to pick up via a mobile app.
  • Service can use your customer segments to prepare resources for them based on challenges Manchester customers are most likely to experience – for example, waiting time to be served.

4. Analyse your customer segments and make adjustments as needed: the how?

Analysing your segmentation efforts will provide insight into the way you’ve organised your customers, to make updates and changes as required. You can also experiment with new ways of grouping your customers together to decide what makes the most sense: which segments are growing revenue the fastest and slowest in terms of total spend? Which segment shows the greatest repeat purchase and customer loyalty? Which segments are most receptive to offers, and through which device?

For example, distinguish between a first-time customer, and ad-hoc customers and those regular, multiple customers but haven’t purchased now for two months. Based on this data, we can tailor our messaging accordingly:

  •  First time: Hey, learn about our new customer offers and first-timer discounts!
  • Ad-hoc: Join our annual subscriber programme and start saving!
  • Lapsed: We have special offers for returning customers!

Customers have a growing ability to determine seamlessly and in real time which company is offering the best product, price and experience. The combination of the Internet, social networks and mobile devices has dramatically shifted the balance of power in favour of the customer. You need to be more transparent and agile than ever before. With a click, customers can compare your product offering and hear what other customers are saying about you and your competitors.

Market segmentation is an increasingly important part of a startup’s marketing strategy and can make all the difference in competitive market landscape to differentiate your business, offering an opportunity to pinpoint exactly where growth opportunities exist for you, so you can deliver more targeted and valuable messaging for the customers you really want to win and retain. The purpose of market segmentation is not only to help you reach your audience but also to allow your customers to see the true value of your brand by differentiating your value proposition that speaks to them, and in doing so puts you head and shoulders above your competitors.

It enables you have a laser go-to-market strategy – executing a marketing plan without any knowledge of how your target market is segmented is akin to firing shots at a target 100m away while blindfolded. The likelihood of hitting the target is a matter of luck more than anything else – there would be panic on the streets of Carlisle, Dublin, Dundee, Humberside, if your ‘bacon butty’ didn’t have the required product-market fit.

Build, view and manage your customer segments proactively. Focus on segmentation to home in on the habits and preferences of your customers to identify your most economically-valuable groups so you can focus on growth opportunities – and hopefully, bring home the bacon.

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