Last Updated: February 10, 2025
You can perform Spatial Segmentation Analysis by using GIS mapping software and geodemographics. Spatial segmentation analysis is a powerful method for businesses to gain actionable insights into their markets by combining demographic and psychographic data with advanced geoanalytics tools. Using software like Maptitude and its segmentation tools, companies can uncover hidden patterns in large datasets to optimize their operations and strategies.
There are normally two phases in a spatial segmentation analysis. The first step is the generation of the overall segmentation framework. This step is the most challenging part of the analysis as it requires the identification of every market segment across the country. The created framework needs to be reusable and it should encapsulate both demographic and psychographic data. To perform spatial segmentation, Maptitude provides users a ready-to-use framework based on Census Block Groups. This allows users to move on to the second step: generation of an individual set of segmentation results, tailored to the interests of a specific business. In this step, users can bring in their own business and customer data to generate important insights into their market. In this article, we will go over how to combine Caliper’s geodemographic segmentation layer with sample customer data to analyze market penetration, high-penetration zones, and also how to leverage this information to discover high-potential markets.
Step 1. Download and Install Software
- Download and install a free trial of Maptitude mapping software, or use your own license of desktop Maptitude.
Step 2: Download Geodemographic data
- Download and install the Geodemographic Segmentation layer from Maptitude.
Step 3: Add the Geodemographic Data into Maptitude
- Go to Map>Layers… >Add Layer then find the ccGeodemographicSegmentation geography file that was downloaded. Click Open.
Step 4: Add Customer Data
- Go to Map>Add Table/Spreadsheet to a Map… then select an excel file containing your customer data. In this case we will be using the Sample Customers file located in the tutorial folder “C:\Users\username\Documents\Caliper\Maptitude 2024\Tutorial\Sample Customers United States.xlsx”. Click Open. Choose My Customers as the sheet and click Next. Select Show Zip Code Boundaries with Data Attached. Click Finish.
- In the Display Manager, toggle the visibly of the My Data set within the 5-Digit-Zip-Code layer so that it is shown.
Step 5: Market Penetration Mapping
- Calculate the percentage of households accounted for by your customers in each census tract or census block group. To do this, open up the dataview of the My Data set within the 5-Digit-Zip-Code layer. Then, select Dataview>Formula Fields. In the box, write the formula
([N My Customers]/Households)*100
. Name this “Percentage of Households” or “Market Penetration”. - Using the color theme on the created formula field, find the zip codes with the highest percentage of households value. These are your best market zones. You can adjust the style of your color theme to show the groups as value ranges or named categories (Low, Average, High, etc).
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- Identify the geodemographic segments that exist in your “High” or “Very High” market. These are the peak market segments that you should be focused on servicing in current cities and other cities where you want to develop locations.
Step 6: Locating High Penetration Geodemographic Segments in a New Market Area
- Keep only these peak segments and transfer this map theme to a new urban region you are interested in exploring as a potential expansion region. These peak segment locations will guide you on which parts of the city you should consider for store locations/targeted marketing.