Segmentation and Target Market: Elio Motors
Tina M Miller
August 18, 2014
Segmentation and Target Market: Elio Motors
Paul Elio is the engineer and company CEO of an American startup automaker founded in 2008: Elio Motors. Production is slated to begin in early 2015 in Shreveport, Louisiana. The design of the vehicle has three wheels with all the standard convinces of a four wheeled vehicle. The selling points of this vehicle is that 90% of the parts used to produce the vehicle are American made, 84 mpg, and a projected manufacture suggested retail price of only $6,800. This paper will discuss the target market, market segmentation, and company strategy and branding. Market Segmentation
The process of dividing an entire market into different consumer segments is just what Paul Elio decided to do when he saw a potential for his 3-wheeled efficiency vehicle. Before a business can target a specific market the market needs to be divided into segments based upon similar needs, wants, or desires. “It is not feasible to go after all customers, because customers have different wants, needs and tastes” (Suttle). Identification of target demographics is necessary for market segmentation research. Consumer demographics range from gender, age, ethnic and religious groups, household size and income, and even geographic regions. Markets can also be segmented based on a consumers behavioral and psychographic characteristics. Mr. Elio took notice that many consumers in their daily commutes are driving large vehicles and have only one person in the vehicle. He saw a need for a more economical commuter vehicle.
Market segmentation does not only happen from the side of the organization, consumers also segment themselves. Consumers will select the proposition that best meets their needs. Therefore the organization must ensure that their product meets the consumers’ needs better than the other supplier. A detailed understanding of who customers are and where they can be found, is very important and will play a critical role in market segmentation analysis. Understanding consumer behaviors and needs will lead the organization to understand what promotional stance to take. Marketing research helped to identify the best target market for the product and Paul Elio used this information to determine the target market for his Elio. Customer Behavior and Target Market
Market research includes the study of consumer behavior to find the target market. Individuals, groups, and organizations have a process that they use to select, secure, and dispose of an item, service, or experience to satisfy a want or need. This process influences emotions and the decision-making process of buyers. Knowing what makes a consumer tick is crucial.
According to Maslow there are five levels of needs: 1) physiological (hunger, thirst, sex), 2) safety (security and protection), 3) social (belonging, love), and 4) esteem (recognition and achievement), 5) self-actualization (fulfillment). Individual progress upwards on the scale. Changes in economic circumstances will affect where an individual is on the scale and advertising appeals focus on needs that are to be satisfied. Maslow’s theory states that when lower level needs are satisfied, a person moves up to the higher level needs and satisfied needs do not motivate; behavior is influenced by needs yet to be satisfied.
As Maslow’s theory focuses on needs the self-concept theory focuses on how individuals see themselves. Marketers will need to focus on the self’s that make one feel better about the product. Paul Elio has the self-image and the looking-glass self with marketing his Elio. The Elio satisfies the fun image that consumers see themselves as or how they wish others to see them.
A factor that Paul Elio continually addresses is the consumers need for safety. A continuous question is, ‘How safe is the Elio?’ The prevailing attitude is that it can’t...
References: Elio Motor: How it all Began. (n.d.). Retrieved from Elio Motors: http://www.eliomotors.com/
Kotler, P., & Keller, K. L. (2012). Marketing management (14th ed.). Upper Saddle River, NJ: Pearson Prentice Hall.
Suttle, R. (n.d.). Define Market Segmentation & Targeting. Retrieved August 17, 2014, from smallbusiness.chrono.com: http://smallbusiness.chron.com/define-market-segmentation-targeting-3253.html
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