B2B Market Segment

Business to Business Market Segmentation
Per Vagn Freytag Ann Højbjerg Clarke
This article discusses the characteristics of industrial markets in relation to some of the major industrial market segmentation models. To understand the different market situations, we describe a scale with simple market transactions at one end and complex relationship management at the other, suggesting that the segmentation approach must be different for each end of the spectrum. The article presents a general industrial segmentation model directed towards situations characterized by relationships and networks. The model stresses the importance of having a deep understanding of the customers’ characteristics, needs, future directions, as well as identification of what kind of overall relationship is required by the customer. This model involves identifying, selecting, and monitoring of segments. © 2001 Elsevier Science Inc. All rights reserved.

INTRODUCTION Segmentation is a crucial activity in marketing, but the way it is viewed has changed over time. Some authors
Address correspondence to Dr. A. H. Clarke, University of Southern Denmark, Department of Marketing, Grundtvigs Alle 150, 6400 Sanderborg, Denmark.

view segmentation as being closely related to another of marketing’s major thoughts, the marketing concept [1]. The essence of the marketing concept is that the best way to address the customer is by satisfying their needs and wants. These needs and wants thus need to be fully understood, and several ways exist to collect and analyze the necessary information. Which ways are used depends on the guiding methodology and techniques applied, but statistical analysis approaches are the most common. Other authors do not see segmentation as a statistical analysis technique, but as a tool for resource allocation. They regard segmentation as an overall way of identifying different target groups (for the purpose of making some general strategic decisions, such as which businesses... [continues]

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