By market segmentation we imply that the entire market is broken down into smaller groups having similar wants. They are homogeneous in themselves and heterogeneous with other groups. The market can be broken down on various bases. These are Demographic, Psychographic, Benefit Segmentation etc.
The concept of divide and rule applies to the market segmentation. You divide the market, choose your target market and then master it. Segmentation and choosing the target market is like shooting with a rifle and not by 12-bore. If the marketing effort is spread over a wide area it does not have that effect but if it is concentrated on a point like a rifle it can go much further and can be more effective.
The segmented market shows 3 groups which are homogeneous in themselves and heterogeneous amongst themselves.
Market segmentation is a process of dividing a potential market into distinct sub-sets of consumers with common needs and characteristics and selecting one or more segments to target with a distinct marketing mix.
Consumers are better satisfied when a wide range of products are available to them. Thus, market segmentation has proved to be a positive force for both consumers and markets alike. If the market was not segmented the same product will be sold to every prospect with a single marketing mix it satisfies a generic or a common need, and it becomes ineffective and ends up appealing to none.
Since the consumers are different in their needs, wants, desire and are from different backgrounds, education experience therefore segmenting the market is very necessary for effective marketing of goods/services.
Segmentation helps in expanding the market by better satisfying the specific needs or desires of particular customers.
Today, nearly every product category in the consumer market is highly segmented. Forinstance, billion dollar vitamin market is segmented by age for children, young adults, the elderly etc. The vitamin market provides benefits like increased energy, illness, tension and stress reduction, enhanced sexuality, improved skin.
Hotels also segment their market, for example Marriott/operatesfairfield for short stay.
Residential thus Inn for extended stay which are for budget-oriented traveller and are cheap.
Courtyard for the price-conscious businessmen.
Marriott Hotel for full business travellers.
Marriott resorts for leisure vacation guests.
Marriott time sharing for those seeking affordable resort ownership.
Marriott senior living environment for elderly people.
Maruti, for instance, have positioned the 800cc basic model and Omini Van for the lower income groups, the Zen, Swift, Alto and Gypsy for the middle income groups, and the Baleno, Esteem etc. for the higher income groups.
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