One might confuse that segmentation means segment “Targeting”. This is not so . Segmenting market is simply a analytical process of breaking the market into different segments. Targeting is a decision to go after a particular segment, and this decision is made after you consider a number of factors including competitive response, and customer perception.
Identifying the potential market segment:
Any firm develops customer profiles after establishing base of segmentation.These profiles identify potential market segments by aggregating consumers with similar characteristics and need.
Choosing a Target Market Approach:
Undifferentiated Marketing (Mass Marketing):
Under this marketing approach the firm tries to reach a wide range of consumers with one basic marketing plan. Those consumers are assumed to have a desire of similar product / service (need).ONE PRODUCT FOR EVERYONE
The firm concentrates on one group of consumers with a distinct set of needs and uses a tailor-made marketing plan to attract this single group.ONE PRODUCT TO ONE MARKET NICHE.
Differentiated Marketing (Multiple Segmentation):
The firm aims to two or more different market segments each of which has a distinct set of needs and offers a tailor-made marketing plan for each segment.TWO OR MORE PRODUCTS TO TWO OR MORE GROUPS. Normal 0 false false false MicrosoftInternetExplorer4
Selecting Target market(s):
While selecting target market a company needs to make two decisions:
- Which segment offers the greatest opportunity?
A company should consider its objectives and strengths, competition, segment size, segment, age, and its ability to develop and sustain a differential advantage.
- How many segments should the firm peruse?
The firm decides whether to pursue one or more segments (or the mass market). Most likely, a firm new to an industry would start with concentrated marketing.