She conducts a careful analysis of sales data within the first few weeks, and quickly identifies a profitable opportunity with a particular group of high-value customers. So, she brainstorms several ideas with her team, and they come up with an exciting new product which has the potential to be a real success for the company. Sofia has identified a profitable segment of the market, but how has she done it?
Creating segments[ edit ] "Market-segmentation research and practice has a long history, and the breadth and success of segmentation applications continues to flourish, with novel and unorthodox profiling applications now reaching beyond the boundaries of a traditional marketing focus".
Market Segmentation can be achieved with 5 steps focusing on the core elements of the segmentation. Define your target market, trends and scope of segmentation. It is important to try and comprehend why the customer is within this specific segment. What are their goals or purpose for being within this market?
What are they likely to be chasing within this segment? By uncovering what the consumers need is the organisation can look to satisfy this need and by doing so better position themselves to approach this market segment.
Identifying other products that match the needs of your consumer is important as well as they will need to be evaluated and analysed because of the Segmentation targetting and positioning they pose to your specific target market.
It is crucial to ensure that as you are understanding the target segment that you are also adjusting your company scope in order to match it with your company objectives and capabilities. If the organisation is not satisfying the consumer need it has identified it will likely fail as consumer needs will not be met.
By specifying geographical limitations, organisations can create a scope that is applicable in their specific domestic position.
Organisations should work to segment areas that are within its areas of operating capability as segmenting areas that aren't realistically available represents opportunities that will be able to be utilised either way.
Perceptual Mapping and Market Mapping[ edit ] "A market map defines the distribution and value added chain between final users and suppliers which takes into account the various buying mechanisms found in a market, including the part played by 'influencers'".
Market Mapping is essential to correctly determine the specific market that should be analysed and the people who should be segmented. This model aids the identification of target consumers from Suppliers, Distributors, Retailers and Final Users.
This includes the high potential market segments and what the size of it is. Perceptual mapping is especially important as it creates a visual diagram of the range of products being offered within a segment.
Traditionally the perceptual map will consist of 4 headings; the basic elements of this map includes Low or High Quality and Low or High Price but these can be changed and altered based on specific product attributes e.
A soft drink producer may want to evaluate a perceptual map including traits such as High or Low in Caffeine and High or low in Sugar in their specific market segment.
Different segments will have different traits and attributes that will need to be evaluated to determine where an organisation will position themselves. By divulging where competitors are positioned within the market map it is possible to see attractive segments of the market that may be worthwhile occupying.
This is where you can begin to form an idea of where you will be able to hit the market as you can see which areas of the market are left untouched or not utilised to its maximum potential.
Construct a Model of the market. It is important to identify these trends and how they come into play within your market model. Transactions made can offer a lot of information about the consumer and it is important that this information is utilized in order to gain the greatest knowledgeable advantage available to your organisation.Positioning is part of the broader marketing strategy which includes three basic decision levels, namely segmentation, targeting and positioning, sometimes known as the S-T-P approach: Segmentation: refers to the process of dividing a broad consumer or business market, normally consisting of existing and potential customers, into sub-groups of.
Market Segmentation, Targeting and Positioning Market Segmentation Concept: Market segmentation is a concept in economics and marketing. A market segment is a sub-set of a market made up of people or organizations with one or more characteristics that cause them to demand similar product and/or services based on qualities of those products.
Segmentation, Targeting and Positioning; This essay will illustrate the extent to which effective marketing must incorporate Segmentation, Targeting and Positioning.
Marketing effectively differs from one organization to another as each has their own separate goals, which they pursue. positioning Once you are done with the previous steps and you have formulated a correct target segment then next step is to position your .
Segmentation, Targeting, and Positioning Segmentation, targeting, and positioning together comprise a three stage process.
We first (1) determine which kinds of customers exist, then (2) select which ones we are best off trying to serve and, finally, (3). To compete more effectively, many companies are now embracing target marketing. Instead of scattering their marketing efforts, they’re focusing on those consumers they have the greatest chance of.