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Target markets can be separated into primary and secondary target markets. Primary target markets are those
market segments to which marketing eorts are primarily directed and secondary markets are smaller or less
important.[4] For instance, the primary target market for
a jewellery store might be middle aged women who care
about fashion, and their secondary target market could
be middle aged men who may want to buy gifts for the
women in their lives.
It is important for a business to identify and select a target
1
2
and funds of any enterprise are limited. Through market
segments, after select the suitable target market, enterprises can focus more on human, nancial, and material
resources, to ght for the advantages of local market, and
then to occupy their own target market. Segmenting the
market allows marketers to better understand the group
they are aiming their message at, which is more ecient
than aiming at a broad group of people. Segmentation has
been an essential part of marketing since industrial development induced mass production, particularly in manufacturing. This caused the focus to shift from customer
satisfaction to reduction of production costs. However, as
manufacturing processes became more variable, and consumer demand diversied, businesses needed to respond
by segmenting the market. Businesses who were able to
identify specic consumer needs were able to develop the
right message for consumers within particular segments,
which gave them a competitive advantage (Wedel & Kamakura, 2012).[9] Since being introduced by Wendell R.
Smith in 1956, the theory has become a key concept in
marketing. Smith stated: market segmentation involves
viewing a heterogeneous market as a number of smaller
homogeneous markets, in response to diering preferences, attributable to the desires of consumers for more
precise satisfaction of their varying wants. (Wedel & Kamakura, 2012).[9] Not establishing a target market will
often result in a poor response from consumers, or no response at all. The aim of market segmentation for businesses is to gain a competitive advantage by having a better understanding of a specic segment than its competitors. Hunt and Arnett (2004)[10] use the example of Black
and Decker power tools, and the way the company segmented the market into three main groups. After identifying each dierent group, Black and Decker then designed one separate power tool range for each segment,
based on their characteristics. To target each segment,
B&D uses specic products lines with dierent brand
names (Hunt & Arnett, 2004).[10]
Demographic segmentation refers to aspects of a market such as age, gender, race, occupation and education.
Creating a message aimed at a particular demographic allows the sender to reach a wide range of receivers, while
still staying within the connes of a specic segment.
Demographic segmentation almost always plays some
role in a segmentation strategy (Thomas, 1980),[11] and
is often paired with other segments to create a slightly
more specic segment. A luxury good or service may be
marketed to high income earners if the marketer believes
that it would be relevant across a large enough portion of
the segment to make it protable for the sender, or create
the awareness intended. Certain brands only target working professionals whereas others might only target people
who are at high school.
One key to identifying the best target audience is assessing brand loyalty involving attitudes and behaviors toward
the brand.[14] Buyer groups can be divided into the following: those loyal to the brand, those who buy your brand
but also buy from competing brands, those who buy more
than one competing brand, those who are regularly loyal
to another brand, and new users who are entering for the
rst time or re-entering.[14] Loyalty, which concerns consumer attitudes in terms of interest in competitive alternatives, overall satisfaction, involvement, and intensity, has
Geographic segmentation divides the market by loca- become increasingly important in competitive markets.
tion. This could be divided into countries, cities, towns
and neighborhoods etc. Dierent geographic locations
usually have dierent aspects to their environment, which
Demographic
the life style, the social class, the motive, the value orientation. Businesses can do this by researching consumers preferences, likes and dislikes, habits, interests,
hobbies, values and socioeconomic group. These variables are concerned with why people behave the way they
do and are often used eectively in conjunction with
other segmentation variables.[4] Psychographics also relates to attitudes toward certain activities like tness, willingness to take risks, concern for the environment, political opinions, concern with fashion, and innovativeness.[14]
Values and culture are strongly linked to how people
think and behave and are important aspects of segmentation variables, especially in global campaigns. Personality traits such as self-esteem, intelligence, and introversion/extroversion also aect the processing and persuasiveness of communication.
Geographic
4 BEHAVIOURAL
with the product or brand choice, so personality can be- it happened to be the best available phone on the market.
come the market segments of the psychological variables. Barnacles: Here is where some companies, especially
B2B companies, nd a surprising amount of their customer base falls into. Barnacles are loyal customers, but
they are loyal customers that rarely make a purchase, and
4 Behavioural
may not bring in much of a prot. A great example would
be a customer that buys one cup of coee at your coee
Behavioral segmentation relates to customers knowl- shop, and then comes in every day for the next month to
edge, attitude, use of product and the purchase occasion, use your free WiFi without making a purchase.
such as special one-o or regular loyal buying. Identifying what customers want from products and the benets Strangers: Due to dierent reasons, some customers are
they seek are important to behavioural segmentation to not loyal to certain brands. Generally speaking, enterallow marketers to better design and select products that prises should avoid targeting strangers, because they will
satisfy these needs [4] . Many marketers believe that be- never become a sincere customer, they have little contri[16]
havioral variables are the best starting point for market bution to the development of enterprises.
segmentation.
Market segmentation is a marketing strategy that cateOpportunity: It is the time consumers buy and use the gorises or segments the market based on their characterproduct. these opportunities include marriage, divorce, istics. These categories or segments are demographic, gepurchase, moving, demolition, admission, study, retire- ographic, psychographic, psychological and behavioural
[17]
ment, travel, tourism, holidays,and so on. It will help im- (market segmentatio n). Market segmentation is an efprove brand usage and marketing targeted. Such as travel fective tool for marketers and is said to be a fundamental
agencies can provide specialized travel services at Christ- concept in modern marketing. It realises that individuals
mas, stationery enterprises can begin to provide more have dierent motivations, desires, lifestyles and tastes.
Market segmentations eectiveness is in ability to divide
learning supplies before new semester.
a market into segments which management can then use
Benet: Benet segmentation is a kind of classication to eectively make further informed decisions. By targetmethod based on the dierent interests of consumers ing individuals with similar characteristics, management
from the brand products.Using the benet segmentation can create an eective marketing plan for their targeted
method, what must be determined is the benet people buyers. They can market their brand and develop and adare seeking for, who are seeking these benets, how im- vertise products that relate at deeper and personal level
portant to them these benets are, what brand can oer with their targeted customers (market segmentationi[17] ).
these benets, what benets have not been met.
Demographic
User status: According to the state of use, consumers
can be classied into once users, nonusers, potential Demographic segmentation is the division of the marusers, the primary user, occasionally users and often user ket based on an individuals sex, age, income and life
type, for dierent type of consumers the brand should use style. Demographic segmentation is used the most fredierent marketing strategies and methods. The brand quently by businesses in comparison to the other market
who has a high market share can focus more on the po- segments. This is possibly because of the ability to easily
tential users to change them to the actual users, such as collect this kind of information. The national census of a
leading brands; some small businesses can only be used country collects this kind of information. Demographic
segmentation has been challenged with scholars stating
as an often user services.
that demographic segmentations such as age and sex are
Brand loyalty: Consumer loyalty is the most valuable poor behaviour predictors. However, other studies have
wealth of enterprises. Consumers can be divided into showed that demographic segmentation is accurate and
four types according to their brand loyalty: True Friends, eective when analysed as a group rather than looking at
Butteries, Barnacles and Strangers.
an individuals behaviour.
True Friends: They are the highest level of the four types Geographic
and the most important part of the customer group. For
example, a fan of a Swiss knife, they will keep telling Geographic segmentation is the division of the market
their friends and neighbors the benets of this knife, their based on an individuals location. This can be either nafrequency of use. These loyal customers will be free of tionally, regionally or locally and was said to be the rst
charge to the brand, and continue to recommend to oth- kind of segmentation used practically. Geographic segers. For any business, this is the most popular type of mentation can be used to compare certain habits and characteristics of dierent locations. UKs National Food
customer.
survey showed that Scotlands consumption of vegetables
Butteries: Butteries are not particularly loyal, but have and beverages was much lower than England and Wales.
spent money on your products and brought in good revenue. An example of a buttery would be someone that Psychological
supports Microsoft in general, but buys the iPhone since
5.2
5
tion of the price of the item, payment methods and the
price changes, changes in price can give one company
have a competitive advantage. Place is where the service
or item is sold; it also includes the distribution channels
in which the company received the service or item. Finally Promotion is the market communication achieved
by, personal selling, advertising, public and customer relations etc. (Cengiz & Yayla (2007); Shahhosseini & Ardahaey (2011) and Suprihanti (2011))
or anything that can be oered to the customers for attention, acquisition, or consumption and satises some want
or need (Riaz & Tanveer (n.d); Goi (2011) and Muala
& Qurneh (2012)). The product is the main part of the
marketing mix where the company can show the dierent
parts of their product compared to that of another product
created by another company. The dierences can include
quality, look, brand name or size. By creating a unique
product it allows for a gap in the market to be lled or a
new market to be created increasing prots for the company.
Dierentiated marketing is a practice at which dierent messages is advertised to appeal to certain groups on
people within the target market (Ramya & Subasakthi).
Dierentiated marketing however is a method which requires a lot of money to pull o. Due to messages being changed each time to advertise dierent messages it
is extremely expensive to do as it would cost every time
to promote a dierent message. Dierentiated marketing also requires a lot time and energy as it takes time to
come up with ideas and presentation to market the many
dierent messages, it also requires a lot of resources to
use this method. But investing all the time, money and
5.5 Place
resources into dierentiated marketing can be worth it if
done correctly, as the dierent messages can successfully
Riaz & Tanveer (n.d) wrote that Place refers to the avail- reach the targeted group of people and successfully motiability of the product to the targeted customers. So a vate the targeted group of people to follow the messages
product or company doesnt have to be close to where its that are being advertised (Ramya & Subasakthi).
customer base is but instead they just have to make their
product as available as possible. This improves eciency
and therefore price can be dropped intern increasing sales 6.3 Concentrated marketing Or Niche
and prot. For max prots a companys distribution chanmarketing
nels must be eective in enticing the customer.
Niche marketing is a term used in business that focuses
on selling its products and services solely on a specic target market. Despite being attractive for small businesses,
6 Strategies for reaching target niche marketing is highly considered to be a dicult marketing strategy as businesses may need thorough and inmarkets
depth research to reach its specic target market in order
to succeed.[19]
Marketers have outlined four basic strategies to satisfy According to (Caragher, 2008),[20] niche marketing is
target markets: undierentiated marketing or mass mar- when a rm/ company focuses on a particular aspect or
keting, dierentiated marketing, concentrated market- group of consumers to deliver their product and marketing, and micromarketing/ nichemarketing.
ing to. Niche marketing, is also primarily known as con-
6.1
Mass marketing
Marketing)
(Undierentiated
6.4
Direct marketing
Niche marketing also closely interlinks with direct marketing as direct marketing can easily be implemented on
niches within target markets for a more eective marketing approach.
Direct marketing is a method which rms are able to market directly to their customers needs and wants, it focuses
on consumer spending habits and their potential interests.
Firms use direct marketing a communication channel to
interact and reach out to their existing consumers (Asllani
& Halstead, 2015). Direct marketing is done by collecting consumer data through various means. An example
is the internet and social media platforms like Facebook,
Twitter and Snapchat. Those were a few online methods of which organisations gather their data to know what
their consumers like and want allowing organisations to
cater to what their target markets wants and their interest
(Lund & Marinova, 2014). This method of marketing
is becoming increasingly popular as the data allows organisations to come up with more eective promotional
strategies and come up with better customize promotional
oers that are more accurate to what the customers like, it
will also allows organisations to uses their resources more
eectively and eciently and improve customer management relationships. An important tool that organisations use in direct marketing is the RFM model (recencyfrequency-monetary value) (Asllani & Halstead, 2015).
Despite all the benets this method can bring, it can be
extremely costly which means organisation with low budget constraints would have trouble using this method of
marketing..
10
REFERENCES
or desire of having the represented style). Consumers are unaware of the amount of information being taken from
persuaded by the characteristics in the advertisement and them as they browse the internet. They don't know how
those of the consumer.[22]
it is being collected and what it is being used for. Cookies are used, along with other online tracking systems, in
order to monitor the internet behaviors of consumers.[30]
Online targeting
10 References
[1] Kurtz, Dave. (2010). Contemporary Marketing Mason,
OH: South-Western Cengage Learning.
[2] Kaleikini, Michael. Why is it important to dene a target market for your business?". Entrepreneur. Retrieved
2016-03-31.
[3] Credo (2011). Target Audience (Denition) in Business. Credo. Credoo. Retrieved 23 March 2016.
[4] Chapman, Devenish, Dhall, Norris (2011). Business Studies in Action. Milton, QLD Australia: John Wiley & Sons
Australia Ltd. pp. 190196.
[5] Dowhan, David (2013). Hitting Your Target. Marketing
Insights. p. 5.
[6] Credo (2011). Proling your target market. in Business:
The ultimate resource. Credo. Retrieved 25 March 2016.
[7] Sherlock, Tracie (25 November 2014). 3 Keys to Identifying Your Target Audience. Database: Business Source
Complete. Retrieved 23 March 2016.
[8] Cohen A. Wiliam. (2005) The Marketing Plan. John Wiley & Sons, Inc.
[9] Wedel, Michel; Kamakura, Wagner A. Market Segmentation - Springer. doi:10.1007/978-1-4615-4651-1.
[10] Hunt, S. D., & Arnett, D. B. (2004). Market segmentation strategy, competitive advantage, and public policy:
Grounding segmentation strategy in resource-advantage
theory.
Australasian Marketing Journal, 12(1), 725. Retrieved from http://search.proquest.com/docview/
199330650
[11] Thomas, J. W. (1980). Market segmentation. Quarterly
Review of Marketing,6(1), 25-28.
[12] Boote, A. S. (1984). INTERACTIONS IN PSYCHOGRAPHICS SEGMENTATION: IMPLICATIONS
FOR ADVERTISING.Journal Of Advertising, 13(2),
43-48
[14] Percy, Rossiter, Elliott (2001). Target Audience Considerations, in Strategic Advertising Management 2001.
Target Audience Considerations. Strategic Advertising
Management. Retrieved 23 March 2016.
[31] Guillaume, Johnson D; Greir, Sonya A (2011). Targeting without Alienating: Multicultural Advertising and the
Subtleties of Targeted Advertising. International Journal
of Advertising. 2 (30): 233258.
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Content license