Market segmentation strategy is one of the emerging trends in business. The process which entails subdivision of the consumer pool into smaller units based on a number of criteria has been found to have numerous advantages. The need for segmentation was realized following numerous challenges that were encountered in meeting the needs of a huge heterogeneous group of clients. Many businesses have turned to segmentation in a bid to improve their returns.
The process of creating subunits is preceded by research. This is done in a bid to identify the specific needs of consumers and how these needs can be solved. Depending on the size of the market, the research may take days, weeks or months. The research also helps in determining the criteria that will be used in creating the required segments.
Research can be conducted in various ways so as to create the segments. This may be done through telephone interviews, face-to-face interviews, email surveys and questionnaires. The research tools are created in a way that will help collect information such as personal information including, geographical location, tastes and preferences and bio data. Customers that give similar responses are placed into the same groups.
There are numerous criteria that can be used when segmenting. Commonly used characteristics include age, gender, consumer tastes and preferences and geographical location. Differences in age affect the type of goods that are demanded and it is important that a business appreciates this. The elderly tend to be rather resistant to change while the young are more likely to embrace changes in products and service delivery.
Gender also has a significant influence on the patterns of demand and supply. Men and women have varied tastes and preferences for different types of goods and services. Women are more likely to conform to changes in fashion while men are not. Also, women have been found to be more regular shoppers compared to their male counterparts. Producers of goods and services need to be aware of these differences.
Seasonality in demand is a form of behaviour segmentation that is fairly common and affects a variety of goods and services. The demand for certain goods increases during certain seasons and decreases thereafter. If the producer has this information, then they will make sure that the goods in question are produced at the required time and adjust downwards later to avoid unnecessary losses.
Behavioural subdivision also includes the use of different levels of product loyalty. Through research, the business should seek to identify the customers that are loyal to the products and those that are not. The loyal customers should be rewarded so as to encourage them to continue using the products and those that are not should be encouraged to be more loyal. Factors that can be used to enhanced loyalty should be identified.
Market segmentation strategy is a way of ensuring that demands of customers are met. It is a process that helps the business to identify the preferences of different consumer groups and how to meet them. It differs from the traditional methods of doing business in which the large pool of consumers was targeted as a whole. Most businesses report an improvement in sales after adoption of this strategy.
The process of creating subunits is preceded by research. This is done in a bid to identify the specific needs of consumers and how these needs can be solved. Depending on the size of the market, the research may take days, weeks or months. The research also helps in determining the criteria that will be used in creating the required segments.
Research can be conducted in various ways so as to create the segments. This may be done through telephone interviews, face-to-face interviews, email surveys and questionnaires. The research tools are created in a way that will help collect information such as personal information including, geographical location, tastes and preferences and bio data. Customers that give similar responses are placed into the same groups.
There are numerous criteria that can be used when segmenting. Commonly used characteristics include age, gender, consumer tastes and preferences and geographical location. Differences in age affect the type of goods that are demanded and it is important that a business appreciates this. The elderly tend to be rather resistant to change while the young are more likely to embrace changes in products and service delivery.
Gender also has a significant influence on the patterns of demand and supply. Men and women have varied tastes and preferences for different types of goods and services. Women are more likely to conform to changes in fashion while men are not. Also, women have been found to be more regular shoppers compared to their male counterparts. Producers of goods and services need to be aware of these differences.
Seasonality in demand is a form of behaviour segmentation that is fairly common and affects a variety of goods and services. The demand for certain goods increases during certain seasons and decreases thereafter. If the producer has this information, then they will make sure that the goods in question are produced at the required time and adjust downwards later to avoid unnecessary losses.
Behavioural subdivision also includes the use of different levels of product loyalty. Through research, the business should seek to identify the customers that are loyal to the products and those that are not. The loyal customers should be rewarded so as to encourage them to continue using the products and those that are not should be encouraged to be more loyal. Factors that can be used to enhanced loyalty should be identified.
Market segmentation strategy is a way of ensuring that demands of customers are met. It is a process that helps the business to identify the preferences of different consumer groups and how to meet them. It differs from the traditional methods of doing business in which the large pool of consumers was targeted as a whole. Most businesses report an improvement in sales after adoption of this strategy.
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