SEGMENTATION technology

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INTRODUCTION

Segmentation - segmentaion is the process of dividing the market of a product or service into smaller groups of custumers . The custumerss in one group should (i)buy the product for the same pupose, or (ii)use the product in the same way, or (iii)buy the product in the same way.BUt custumers in one segmentshould be diffrent from custumers of any other segment in one or more of the above parameters. Segmentation of a market makes sense only when the company has to design a seprate value proposition for each segment.


UNIT OBJECTIVES
• Understanding the concept of custumer value proposition to define the need for segmentation.
• Describing the inherent inefficiency of non-segmented markets
• Understanding the concepts of market segmentation, target marketing, and their use in developing marketing strategy
• describing the various methods of segmenting custumer and organizational markets


CUSTOMER VALUE PROPOSITION

Segmentaion reffers to the process of identifying clusters of custumers who desire the same value proposition. Customer value proposition is a unique mix of productand services attributes,customer relations,and corporate amage that a company offers. customer value proposition define how the organizatin will defrentiate itself from cometitors to attract,retain and deepen relationships with target customers.


Segmentation Strategies

There are two different strategies that are widely used: (1) Concentration strategy (2) Differentiation strategy

Concentration Strategy involves the product owner isolating a single sub group and developing a specific program for this group.
Differentiation Strategy involves the organization identifying two or more subgroups which are candidates for separate marketing programs.
If segmentation is not employed then the strategy is referred to as “undifferentiation”or aggregation”


Stage three - targeting through marketing mix

The third stage of the market segmentation process is the creation of a specific
market mix to fulfill the needs, as well as market conditions of each specific target
segment (Wilkie, 1990; Gunter & Furnham, 1992; Kotler, 1994). Although many authors limit the market segmentation process to market identification rather on the key elements of the entire process, most companies fail to give due importance to other stages in market segmentation such as product positioning and mix development (Sarabia, 1996).


Levels of Market Segmentation

Because buyers have unique needs and wants, each buyer is potentially a separate market. Ideally,then, a seller might design a separate marketing program for each buyer. However, although some companies attempt to serve buyers individually, many others face larger numbers of smaller buyers and do not find complete segmentation worthwhile. Instead, they look for broader classes of buyers who differ in their product needs or buying responses. Thus, market segmentation can be carried out at several different levels. Figure shows that companies can practice no segmentation (mass marketing), complete segmentation (micromarketing), or something in between (segment marketing or niche marketing).