Market Segmentation Essay

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POH CHIA SHIN (4813194) Q4 Market Segmentation, Targeting and Positioning i) Explain, with example, the rationale of ii) What segmentation variables would you suggest to the following marketer and why? a) Soft drink company b) Automobile company c) Mobile phone company d) Hotel operator i) Successful companies add value for customers by selling them products and services they need at a price they can afford. These companies use marketing strategies to match the products and services they produce to the needs of the market. The rationale for using different marketing strategies is to obtain a better understanding of market needs and to more completely satisfy them. Companies that develop effective marketing strategies achieve high sales volumes at the desired profit margins. A key marketing strategy is the segmentation of the market into parts that the company can analyze. Since customers have different characteristics and various needs, it makes sense to group similar customers together. These groups have common characteristics and needs. The rationale behind implementing such a marketing strategy is that the company can better satisfy the needs of segments of similar customers. It can design slightly different products for different segments and match promotion to the customers. By better satisfying the needs of each segment, the company achieves higher performance. One of the characteristics of a marketing plan is its marketing mix. The plan specifies a strategic mix of price, product, place and promotion that matches the characteristics of each market segment. The rationale for using a marketing mix strategy is that these four elements represent the key aspects of marketing activities. If a company can design a product or service that meets the needs of the market, offer it at an affordable price, sell it in convenient locations and let the target

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