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.
Showing posts with label market strategies. Show all posts
Showing posts with label market strategies. Show all posts
Friday, February 26, 2010
Tuesday, February 16, 2010
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
* 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
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