Market Segmentation | Best Assignment Writers Online

It is a management tool for the selling manager in the critical task of picking out a target market for a given manufactured good and planning an apt selling combination (Dolnicar et al., 2018). It forms the basis for marketing success. Segmentation is all about creating divisions. The primary cause is the assumption that different customers have different needs that need to be addressed differently. There exist four prior market segmentation:

1. Geographical segmentation: Segmentation is done based on the geographical location of the customers.
2. Psychographic segmentation: pertains to lifestyle, personality traits, and attitude. It allows for a fine-tuning of marketing strategies, particularly media and message strategies.
3. Behavioral segmentation: is founded on the audience’s conduct, custom, liking, choosing, and decision-making.
4. Demographic segmentation: offers a statistical description of a population in terms of age, gender, occupation, and social status. More focus is drawn to certain demographic groups to target a specific age. An example of demographic segmentation is launching a brand-led mall hangout space to enter, understand, and influence its young consumers’ daily lives. It may offer gaming, surfing, and movies.

Strategic Positioning

Strategic locating is a company’s relative position within its industry matters for performance. It makes selections of how the industry will maintain a gainful position in the market. The essential elements are; offering distinctive and valued products to target customers, lowering prices below competing alternatives, and striking a compelling blend of diversity and low prices (Wu, 2019). For example, Gatorade, a sports drink from Pepsi, is a high-priced product, while PowerAde from Coca-Cola is cited as a low-price alternative inside a similar marketplace. Gatorade’s customers are willing to pay a high price; Coca-Cola exploits the need for customers who cannot afford the high-priced Gatorade with low-priced PowerAde. Coca-Cola products are differentiated and positioned as top brands in different categories.

Chain of Distribution

A candy company will utilize a longer chain of distribution since it reaches the general market, with consumers scattered worldwide. The company will need to provide candy at its customers’ convenience (Martín & Taboubi, 2015). As for restaurant equipment, the products are expensive, technical, and customized to a customer’s need and have a small number of buyers, hence the short distribution chain.

Customer’s Attitude towards Business

The best strategy to changing the consumers` attitude is by persuasion. Persuasion is how a message prompts a change in opinions, insolences, or actions (Myers, 2011). The restaurant should weave a carefully crafted message with stories and visuals to create an emotional experience for the public. The message should invoke a sense of need.

Pricing Strategies

Businesses have a variety of pricing strategies to choose from based on their needs. Below is a simple explanation for four commonly used pricing strategies:

1. Price skimming. According to Bhasin (2020), skimming entails charging the premier introductory price that customers will pay and then lowering the cost over time.
2. Penetration strategy. Refers to a concept of taking aggressive action to gain exponential expansion of one’s share of total sales in a market.
3. Value-based pricing. According to Bhasin (2020), this pricing strategy involves setting costs mainly centered on a customer’s perceived worth of a product.
4. Prestige pricing is the practice of appraising your goods or service at a higher level to give off the look of superior production.

The cost-volume-profit analysis helps to determine the relationship between total sales, total cost, and profit. The above is useful in planning profits (Bhasin, 2020). Hermes and Rolex brands target wealthy consumers to whom exquisite and elegance matter more than money. Hence, their market is always open.

References

Bhasin, H. (2020. January 25). Marketing mix of Rolex. Marketing Mix. Retrieved February 21, from https://www.marketing91.com/marketing-mix-of-rolex/

Dolnicar, S., Grün, B., & Leisch, F. (2018). Market segmentation analysis: Understanding it, doing it, and making it useful (p. 324). Springer Nature.

Martín-Herrán, G., & Taboubi, S. (2015). Price coordination in distribution channels: A dynamic perspective. European Journal of Operational Research, 240(2), 401-414.

Myers, G. (2011). African cities: alternative visions of urban theory and practice. Zed Books Ltd.

Wu S. (2019). Strategic Positioning. Strategy for Executives. Retrieved February 21, from https://strategyforexecs.com/strategic-positioning/