fileassignment3 - 1 Why would one consider the process of...

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1) Why would one consider the process of market segmentation to be one of the most important aspects of marketing? (10) One would consider the process of market segmentation to be one of the most important aspects of marketing because it creates target markets which allows for a company to expand on sales with new and existing customers. By focusing on a specific customer base a company can better serve their customers wants and needs. Also, usually customers are more willing to pay a higher premium for a product that best fits their needs. Therefore, if a company narrows down exactly what a customer wants they have a good chance of beating out products by other companies that don’t meet the customer’s needs as well. Take for instance a shoe company like Nike, who obviously first breaks down into two segments, male and female, and then goes on to segment even more into different sports or activities or even styles. For example, they have sneakers targeted to just basketball players, runners, walkers, and beyond. By doing so Nike better satisfies their customer’s wants and allows the company the opportunity to expand sales and increase revenue. For instance, a basketball player looking for a good sneaker can walk into a shoe store and underneath each sneaker is a label of what kind of shoe it’s for, which allows the customer to easily identify the product. Another great example of why market segmentation is important can be seen through shampoo companies. Today, shampoo companies have segmented their hair products by hair type. For instance, Pantene Pro-V has shampoos for curly, straight, frizzy, or damaged hair. If they weren’t to do so, they would have a more difficult time drawing in a reason for a customer to buy their product. By doing so, they allow a customer to easily identify with a product, see the benefit of a product compared to a regular shampoo for every type of hair, which can
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allow a company to see high profit margins. Overall, it’s most important because it allows a company to better understand the wants and needs of the consumer in hopes of using that information to make greater profit. Especially because markets have generally become larger and larger, more distinct, and overall there are just more types of segments. 2) Take an example of a consumer product and indicate how you suspect the segmentation “criteria” were met? (20) The three criteria of market segmentation are identifiability, accessibility, and significance, which can all be represented by a consumer product such as the iPhone. Firstly, I believe the criteria for having identifiability was met by breaking down the large market of iPod and Apple users into a group of people who were cell also cell phone users. For Apple, measuring the size and purchasing power of the segment wasn’t too difficult because they had sales data and demographic information on previous buyers of Apple products, more specifically perhaps the iPod touch. Next I believe the criteria of
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fileassignment3 - 1 Why would one consider the process of...

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