Market Segmentation

Only available on StudyMode
  • Download(s) : 61
  • Published : January 3, 2013
Open Document
Text Preview
Number of Words: 2150

Table of Contents

Introduction2
Question 1 – Customer Decision Making Model3
Question 2 – Market segmentation and iPad market6
Conclusion8
References9

Introduction

This assignment analyzes two questions, which are customer decision making model (CDMM) and market segmentation. Customer decision making model is a decision making process of a customer before buy a product. In the process, purchase decision consider as a main decision because it transfer product ownership to a customer (Magretta, 2002). The process is a combination of five steps. They are identification of customer problem, need or want, search for possible option to fulfill the need or resolve the identified problem, evaluate identified options through SAF approach, purchasing decision and post purchase audit. In special occasions customers skip some levels of CDMM and make sudden but effective decisions. Second question is to explain market segmentation and identify appropriate market segment for sell iPad. Through detailed analysis, company identify two possible market segments, that is people value and work with timely information (work with laptops, mobile phones, internet connectivity and etc) as long term market segment and early adopter who like to experience latest innovations as short term market segment. At the same time company has to undertake some advertising and promotional activities to market iPad among identified market segments (Lynch, 2003).

Question 1 – Customer Decision Making Model

When customer buy a product or service, purchase decision is the most important step of a long process called customer decision making model. This process helps customers to select suitable, acceptable as well as feasible solutions for fulfill their needs and wants. Most customers follow the process unknowingly and some of them skip some levels of the process under lots of reasons. As a first step of customer decision making model, customer identifies problem need to be solved or needs and wants to be satisfied through buying a product or service. Then the person search for more information and identify possible options to buy a product or service (Altstiel and Grow, 2006, p45). As s third step, customer undertakes SAF approach to selected options and make purchase decision based on above identified and analyzed information. After purchase a product, customer undertake post purchase audit as a final step of the process. Altogether the process holds five main steps including purchase decision. Purchase decision considered as most important decision in the process, because the step make transaction which generate revenue to an organization and transfer ownership of products and service to customer by completing purchasing process.

When undertaking a detailed analysis of customer decision making model, first step is to identify problems need to be solved or needs and wants to be satisfied through buying a product or service. In the step different needs and wants, fashion, industry trends, influences from external or internal parties and factors made expectation for customers and force them to fulfill these expectation by applying suitable solution. These expectations can be developed organically and artificially. If customer got the expectation because of his real need or want, then it is an organically developed expectation. But customer got the expectation through external factors such as advertisements, recommendations, promotions and etc but not because of real needs or want, then it is an artificially developed expectation (Clow and Baack, 2007, p164).. Therefore customers find out information for suitable solution to fulfill above identified expectations.

Second step is to identify each and every products or services which can fulfill above identified expectation. In the step...
tracking img