Strategic Marketing Management
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Chapter 10 : Segmenting Markets
Markets and Marketing Approaches
Segmentation, Targeting, and Positioning
Market Segmentation
Approaches for Segmenting Markets
Requirements for Effective Segmentation
Developments of Segments
Niche Marketing
Bases for Segmentation
Geographic and Geo-demographic Segmentation
Demographic Segmentation
Behavioral Segmentation
Psychographic Segmentation
Multi-Attribute Segmentation
Segmenting Industrial Markets
Strategic Analysis of Market Segments
Customer Analysis
Competitor Analysis
Positioning Analysis
Chapter Summary
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Marketing is one of the most important activities of organizations. Retaining
customers and serving them according to their tastes and preferences is the
key for successful business performance.
Marketing is considered as an organization-wide activity. The conventional
mass marketing and product-variety marketing have now shifted to
individualized marketing. The rapid advances in technology are giving an
impetus to the changing marketing environment of the organizations.
Customers in the changing global marketing environment expect companies to
serve them better and companies have to gear themselves up to meet the
changing expectations of the customers. To serve customers better, companies
need to segment the markets according to the characteristics of customer
groups. Once the companies segment the market, the next thing that they do
is to target those market segments with sales and promotional strategies. |
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One of the important objectives of market segmentation is to identify
different clusters in the market that are clearly distinct. Each cluster
should have different characteristics when compared to other clusters. The
two most important approaches to market segmentation are the a priori
approach and the post hoc approach.
The criteria for effective segmentation are that the segments must be
identifiable, and that there should be differences in customer responses,
actionability of the segment, financial suitability of the segment, and
stability of the segment. Consumer markets can be segmented based on the
geographic, demographic, psychographic, and behavioral characteristics of
the customers. Geo-demographic segmentation has been one of the marked
developments in market segmentation.
The strategic analysis of the market segment involves a detailed analysis of
each market segment that has been selected for its potential attractiveness.
This analysis involves customer analysis, competitor analysis, and
positioning analysis.
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