1. Define the segmentation scenarios considered by Dana Wheeler and discuss the pros and cons of each scenario.
In the HBS Fashion Channel case, Dana Wheeler considered 3 different market segmentation scenarios. Various market research firms had divided viewers into 4 distinct groups: “Fashionistas”, “Planners and Shoppers”, “Situationalists”, and “Basics”. These four groups were comprised of a mix of consumers with a plethora of demographics, all with specific desires, interest in fashion, and values. To survive against new competitors such as CNN and Lifetime, Wheeler needed to choose a segmentation strategy that would increase network ratings, generate loyal fans for TFC, and attract viewers that were highly valued by advertising agencies. Scenario 1: Broad Based Multi-Segment Strategy
The first scenario examined by Dana Wheeler would essentially maintain the status quo at The Fashion Channel (TFC). Wheeler considered a “multi-cluster” approach that would target a broad cross segment of Fashionistas, Planners and Shoppers, and Situationalists. This segmentation scenario intends to reach the largest audience and appeal to as many people as possible, similar to an undifferentiated targeting approach. Pros:
* Cheapest scenario because of easy implementation. There is no need to develop new programming. * Sticks with old marketing approach, which had caused TFC to grow so quickly in the past and become popular in its early years. * Keeps executives calm – Why fix something that “isn’t broken”. * Hits the target market of valuable 18-34 year old females in all clusters (Fashionista, Planners and Shoppers, and Situationalists). * Will not drive any existing loyal viewers away because not much will change.
* Luke-warm approach – by attempting to satisfy everyone, TFC will satisfy no one * Risk losing viewers too more targeted programs like CNN and Lifetime. * Devastating long...