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What is Market Segmentation?
Market segment is a subset of market. It is a part of a market. Just like a slice in a pizza, a market segment is used to divide market based on the type of consumers who are in that group. Dividing the consumers based on the ‘most likely’ people who will buy the product. A market in the broader sense cannot be addressed many a times as all customers cannot connect to all products. There are different consumers with different wants and based on these wants companies segment the market. It helps the company understand the needs of the consumer base. Focusing on certain consumers, a company can easily sell its products to them.
It’s very important that companies concentrate on market segments rather than on the whole market as such. For ex: entertainment industry is one of the best examples of market segmentation. Movies, music and T.V programs are based not on all the audience but on segments divided based on age, sex, education, income level and geographic location, etc. Movies and music can be divided based on genres and the consumers who consume them can be divided I.e. market segmentation can be done on the basis of genres like In Movies: Action, comedy, thriller, animation, etc. In music the various genres can be Hip hop, rock, classical, pop and trance, etc.
While there may be theoretically ‘ideal’ market segments, in reality every organization engaged in a market will develop different ways of imagining market segments, create product differentiation strategies to exploit these segments. The market segmentation and corresponding product differentiation strategy can give a firm a temporary commercial advantage.
Along with playing a role in the development of new marketing approaches to attract a certain demographic within the market base, market segmentation can also help a company understand ways to enhance customer loyalty with existing customers. As part of the process of identifying specific groups within the larger client base, the company will often ask questions that lead to practical suggestions on how to make the products more desirable to customers. This activity may lead to changes in packaging or other similar changes that do not impact the core product. However, making a few simple changes in the appearance of the product sends a clear message to consumers that the company does listen to customers. This demonstration of good will can go a long way to strengthen the ties between consumer and company.
Portfolio of our Market segmentation assignment help experts
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He has over 25 years of experience in teaching and has done D.B.A from Indiana University in the areas of Decision Sciences and Marketing. His assignment writing and homework essays are unique as he includes real life examples to explain the assignment questions.
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