EXPLAIN WHY IT IS IMPORTANT FOR MARKETERS TO UNDERSTAND THE CONCEPTS OF MARKET SEGMENTATION AND TARGET MARKETING. DISCUSS IN DETAIL DIFFERENT METHODS MARKET SEGMENTATION AND TARGET MARKETING STRATEGIES AVAILABLE TO USE BY MARKETERS. PROVIDE EXAMPLES TO SUPPORT YOUR ANSWERS ON THE BASIS OF EITHER A SINGLE CASE COMPANY OR SEVERAL COMPANIES FROM ANY INDUSTRY OF YOUR CHOICE.
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TABLE OF CONTENTS
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Market segmentation and target marketing are the two key components of marketing strategy. The importance of understanding them cannot be underestimated by the marketers in order to be successful. This essay will enlighten the value of segmentation process and the choice of target markets. It consists of two parts. The first one familiarises the reader with a concept of market segmentation. Then examines the various methods and bases of market segmentation, highlighting the benefits of successful approach and bringing to the attention the risks of poor application. The second part explores the strategies of target marketing available for the marketers. It clearly shows the advantages and disadvantages of each of the tactics. Various theories will be introduced, aiming to show that the area is still not clarified and evolving. The work compares and contrasts different views and shows the development of the techniques and methods used in the contemporary world. The author will demonstrate the connexion of these two processes in context of creating the marketing strategy. The online networking sites – Facebook and LinkedIn will be used as examples. The reader will see how these giants of the networking industry have successfully identified the relevant segments and applied the individual strategies for their target markets. It will also be explained how the other businesses are able to conduct the process of segmentation and identify their target market using networking websites. Finally it will summarize the argument, by highlighting the major parts and the significance of this knowledge for the marketers.
Market segmentation can be defined as a process of recognising the most useful bases for dividing a market, classifying the customers in diverse segments and developing segments descriptions (Hooley et al. 2012). Market segmentation is the foundation for the selection of target markets – the segments of the market that company is deciding to serve. This fundamental step allows marketers fully and in-depth understand and appreciate the requirements of a segment and tailor a marketing mix package that matches their needs. The process of marketing segmentation helps to develop the differential marketing strategies. By dividing market into sub-markets a company may discriminate its offerings among segments and also differentiate from its competitors (Jobber 2010). Hooley et al. (2012) argues that there are three requirements that underpin market segmentation. First the segments must differ from one another, providing therefore useful differences between the potential customers. Secondly segments have to be identified by measurable characteristics, enabling estimation of the value of the market and allowing identification of the market. Finally chosen segments supposed to be isolated from the rest of the market, permitting them to be targeted with individual offering. Market can be segmented in many ways. When it comes to consumer markets, however there are three broad groups of segmentation criteria: behavioural, psychographic and profile variables. According to Jobber (2010), behavioural variables distinguish between the differences in consumer behaviour. A benefits sought measure is useful when people seek different benefits from a product in the market. Benefit segmentation method is essential because the objective or marketing is to...
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