MARKET SEGMENTATION Market Segmentation,

Transcript:MARKET SEGMENTATION Market Segmentation,:
MARKET SEGMENTATION Market Segmentation, Segmenting International markets, Selection of International Markets, Alternative market entry strategies. What is market segmentation? Market segmentation is a technique you can use to divide your customer base into subgroups based on shared characteristics, such as age, income, hobbies, and location. The aim of segmentation is to tailor marketing efforts to your ideal customer profile (ICP), i.e. the customers most likely to buy your product or service. CHARACTERISTICS OF SEGMENT Measurable – size, purchasing power, characteristics Substantial- segment which is sufficient to give profit. Accessible – segment has effective reach to customers and the ability to serve. Differentiable – segment must give different responses not the same Actionable marketing mix must be accepted by the region and attract segment. Why is a market segmentation strategy important? According to Bain and Company, businesses that tailor strategies to customer segments generate yearly profit growth of 15% vs 5% for businesses that don’t. In short, market segmentation can drive significant growth. Segmentation techniques are major profit drivers because they help you define your target market and qualify customers as users of your product or service. You can then provide the personalization that 73% of shoppers now expect from brands – sending the right message, through the right channel, at the right time. Market segmentation also helps you to: Enter new markets Build products that solve customer pain points Streamline sales processes Drive more revenue from email marketing Drive more revenue from social media marketing Increase customer retention Bases of segmenting Consumer Markets 1. Demographic segmentation: The who Widely used by D2C e-commerce brands, demographic segmentation is one of the most simple yet effective kinds of segmentation. You can use demographic segmentation to split your audience and create customer personas based on objective information, such as: Age Gender Income Level of education Religion Profession/role in a company For example, if you segment your audience based on your customers’ income, you can target them with products that fall within the constraints of their budget. If you’re a small business or new to ecommerce, this is a straightforward type of segmentation with three key advantages: It’s easy to collect information It’s simple to measure & analyze It’s cost-effective 2. Psychographic segmentation: The why Psychographic segmentation is the process of grouping people together based on similar personal values, political opinions, aspirations and psychological characteristics. For example, you can group customers according to their: