Segmentation, Targeting and Positioning
This essay will illustrate the extent to which effective marketing must incorporate Segmentation, Targeting and Positioning. Marketing effectively differs from one organization to another as each has their own separate goals, which they pursue. To answer how important each of the afore mentioned marketing tools are, one must define what Marketing is and then take into account how each is applied and why if not applied in an organizations approach to selling could mean abrupt failure, or maybe that they do not matter at all.
It begs the question; why segment the market instead of mass marketing the same product? The best-known example of Mass Marketing or Undifferentiated Marketing is told by Kotler and Armstrong (2001). They go on to use the example of Henry Ford’s marketing strategy of the Model T Ford. When he put the car into production, he told the consumers, they could have the car “in any colour as long as it is black”. This though was many years ago; Ford has progressed and produces many different models today. An example of a company who still uses the Mass Marketing technique is outlined by Wilson and Gilligan (1997). Black & Decker faced a drop in its worldwide share of the power tool market from 20% to 15% as more Japanese firms began to compete by marketing in a more ‘aggressive’ manner than Black & Decker. As a result of this Black & Decker moved away from a policy of customized products for each market and instead focused making a smaller amount of products that could be sold everywhere which the same basic marketing approach. From this example it can be seen that not breaking down the market in terms of product, works for some companies whilst also satisfying customers, hence the increase in market share for Black & Decker.
Ultimately segmenting the market is the first step to giving the firm the ability to better match the customer needs, enhance profits, enhance opportunities for growth, retain