Market segmentation strategy is fairly new concept in business. As the name suggests, it the process of dividing the market in a manner in which specific consumer needs will be addressed. The increase in popularity in this method of advertisement is largely due to the challenges that have been faced with other methods. For instance, mass marketing, which has been with us for many years, aims at reaching out to the whole population and this may not address what each consumer needs.
There are several methods that can be employed when carrying out this division. What is important to know is that, one will adopt their preferred method depending on the nature of goods and services that they produce. Another important consideration is the nature of the industry as regards, for example, the number of players and the existing laws.
There are a number of things that you need to have in mind as you segment your consumer pool. Ideal segments have to meet a set of minimum requirements. Each segment must be profitable enough to support the administration costs that are directly attributable to it as well as the costs involved in production of the goods or services. It is also important to ensure that there is homogeneity within the segment.
It is important to ensure that the segments created are stable. Stability ensures that there is enough time for changes in demand and consumer satisfaction to be seen. It allows for the producer or advertiser to start receiving returns. For this reason, the attributes that are chosen as the basis for segmentation must be carefully selected.
There are a number of consumer characteristics that used for creation of segments. Geographical location of the targeted consumers is one of the commonest attributes that can be used. It entails the breakdown of the large pool of customers based on their country, city or even state of origin. By creating consumer profiles based on this data, decisions regarding service provision and product production are made.
Behavioral segmentation is a popularly used type of marketing. The idea here is to divide the consumer pool into different groups based attitude and on the knowledge of various products and services. It encompasses what is referred to as occasional buying. Occasional buyers are customers who buy goods or services depending on the prevailing conditions. This may refer to, for example, the increase in the demand of gifts during Easter or Christmas by Christians. Other occasions that can be used to segment consumers include weddings, birthday parties and funerals.
Another method that is employed is what is termed psychographic segmentation. Here, the customer pool is divided based on consumer psychology and demographic characteristics. Attributes that are used include, among others, personal values, social class and lifestyle among others.
Market segmentation strategy is not governed by hard and fast rules as many believe. On the contrary, it is mainly dependent on the preferences of the advertiser. Almost any attribute can be used provided the created segments are large enough. Income, age and gender differences are some of the easiest characteristics to use. When one chooses a preexisting characteristic, this is called prior and when they conduct research to determine variables, this is called post-hoc grouping.
There are several methods that can be employed when carrying out this division. What is important to know is that, one will adopt their preferred method depending on the nature of goods and services that they produce. Another important consideration is the nature of the industry as regards, for example, the number of players and the existing laws.
There are a number of things that you need to have in mind as you segment your consumer pool. Ideal segments have to meet a set of minimum requirements. Each segment must be profitable enough to support the administration costs that are directly attributable to it as well as the costs involved in production of the goods or services. It is also important to ensure that there is homogeneity within the segment.
It is important to ensure that the segments created are stable. Stability ensures that there is enough time for changes in demand and consumer satisfaction to be seen. It allows for the producer or advertiser to start receiving returns. For this reason, the attributes that are chosen as the basis for segmentation must be carefully selected.
There are a number of consumer characteristics that used for creation of segments. Geographical location of the targeted consumers is one of the commonest attributes that can be used. It entails the breakdown of the large pool of customers based on their country, city or even state of origin. By creating consumer profiles based on this data, decisions regarding service provision and product production are made.
Behavioral segmentation is a popularly used type of marketing. The idea here is to divide the consumer pool into different groups based attitude and on the knowledge of various products and services. It encompasses what is referred to as occasional buying. Occasional buyers are customers who buy goods or services depending on the prevailing conditions. This may refer to, for example, the increase in the demand of gifts during Easter or Christmas by Christians. Other occasions that can be used to segment consumers include weddings, birthday parties and funerals.
Another method that is employed is what is termed psychographic segmentation. Here, the customer pool is divided based on consumer psychology and demographic characteristics. Attributes that are used include, among others, personal values, social class and lifestyle among others.
Market segmentation strategy is not governed by hard and fast rules as many believe. On the contrary, it is mainly dependent on the preferences of the advertiser. Almost any attribute can be used provided the created segments are large enough. Income, age and gender differences are some of the easiest characteristics to use. When one chooses a preexisting characteristic, this is called prior and when they conduct research to determine variables, this is called post-hoc grouping.
About the Author:
For information about the techniques of market segmentation strategy, visit the web pages at www.qdistrategies.com today. You can see details here at http://www.qdistrategies.com now.
No comments :
Post a Comment