Attributes of effective market segmentation

Market segmentation is resorted to for achieving certain practical purpose. For example, it has to be useful in developing and implementing effective and practical marketing programmes. For this to happen, the segments arrived at must meet certain criteria such as:

a. Identifiable: The differentiating attributes of the segments must be measurable so that they can be identified.

b. Accessible: The segments must be reachable through communication and distribution channels.

c. Sizeable: The segments should be sufficiently large to justify the resources required to target them. A very small segment may not serve commercial exploitation.

d. Profitable: - There is no use in locating segments that are sizeable but not profitable.

e. Unique needs: To justify separate offerings, the segments must respond differently to the different marketing mixes.

f. Durable: The segments should be relatively stable to minimize the cost of frequent changes.

g. Measurable: The potential of the segments as well as the effect of a specific marketing mix on them should be measurable.

h. Compatible: - Segments must be compatible with firm’s resources and capabilities.

Marketing Strategy and Market Segmentation

When it comes to marketing strategies, most people spontaneously think about the The four (4) P (Product, Price, Place, Promotion). This 4P may be extended by three more for marketing services (People, Processes, Physical Evidence).

Market segmentation and the identification of target markets, however, are an important element of each marketing strategy. They are the basis for determining any particular marketing mix. Basic steps in marketing strategy are as follows:-

- Market Segmentation:
1. Identification of customers' needs and market segments.
2. Develop profiles of resulting market segments.

- Identification of Target markets:
3. Evaluation of level of attractiveness of each segment.
4. Selection of Target segments

- Positioning:
5. Identification of different advantages in each segment.
6. Development and selection of positioning concepts.

- Marketing Planning:
7. Development of marketing mix for each segment according to the choosing position.

Target Market Strategies

There are several different target-market strategies that may be followed. Targeting strategies usually can be categorized as one of the following:

* Single-segment strategy - also known as a concentrated strategy. One market segment (not the entire market) is served with one marketing mix. A single-segment approach often is the strategy of choice for smaller companies with limited resources.

* Selective specialization- this is a multiple-segment strategy, also known as a differentiated strategy. Different marketing mixes are offered to different segments. The product itself may or may not be different - in many cases only the promotional message or distribution channels vary.

* Market specialization- the firm specializes in serving a particular market segment and offers that segment an array of different products.

* Product specialization- the firm specializes in a particular product and tailors it to different market segments.

* Full market coverage - the firm attempts to serve the entire market. This coverage can be achieved by means of either a mass market strategy in which a single undifferentiated marketing mix is offered to the entire market, or by a differentiated strategy in which a separate marketing mix is offered to each segment.

A firm that is seeking to enter a market and grow should first target the most attractive segment that matches its capabilities. Once it gains a foothold, it can expand by pursuing a product specialization strategy, tailoring the product for different segments, or by pursuing a market specialization strategy and offering new products to its existing market segment.

Another strategy whose use is increasing is individual marketing, in which the marketing mix is tailored on an individual consumer basis. While in the past impractical, individual marketing is becoming more viable thanks to advances in technology

Understanding Market Segmentation and Targeting

Segmentation is the process of identifying and selecting one or more market segments to which a business or organization can target. Segmentation can be based on gender, age bracket/group, nationality, political/religious beliefs, etc.

Segmentation is considered as an adaptive strategy because it has been a common practice among many organizations to adapt to the market needs based on the results of the segmentation They can change their identities, develop new products or even modify their advertising campaigns with market segmentation using some proving marketing manual

But in actual fact, segmentation doesn't always have to be a purely adaptive strategy. With segmentation, a marketer can choose which of the segments he is well suited to serve, thus allowing him to have competitive advantages over his competitors for that particular market segment.

Regardless of how it is incorporated into the marketing activities, the aim of segmentation enable companies and marketers to provide higher values to their potential customers by letting them know who they are catering to and letting them address the specific needs and concerns of that target market segment.

When done with segmentation, the next thing to do is to target all efforts and focus them on the identified market segment. Marketers will create a marketing campaign that will fulfill the needs, as well as the market condition, of the target market segment.

For example, an online marketers who promotes his products through a websites that has been filled with generic pages can carry out market segmentation on one of the page. Let say he finds out that more men than women are visiting that page, he will look for other variables like a dominant age group of the visitors. He will now use these variables to improve his site conversion rate by improvising the following methods:

• If he has already known that men outnumber women on most social networks, then he can make his page clean and easy to understand. Also, he will link it to his Facebook fan page and put a note on his page telling his target audience how they can follow him on Twitter.
• He can either import 3rd party reviews to his page or ask his customers to write reviews for him in exchange for some incentives. He will need to be creative here.
• He can use straightforward language and present his information in bulleted form to make it easy to look at and understand. Better yet he can try to provide all the information his audience need in a single mouse click.
• He can also try to improve his page content clarity by using some images that appeal to his target market segment . He will need to do some test (using proven tool ) to find out what work and what does not.

Segmentation as explained above can provide both manufacturers and marketers a fair amount of information upon which to build their product web page. If everything is done correctly, it is very likely that the web page will have higher bounce rate and more click-through.