Focus with Market Segmentation

JWI 518, Marketing in a Global Environment, Week5 Summary, 11/9/12

This week we learned the value of segmenting markets and also the pitfalls to avoid with segmentation. Market segmentation is a strategy marketers use to identify and profile distinct groups of buyers who differ in their needs, wants, desires and fear. Segmentation allows marketers to focus the firm's resources by tailoring specific messages to target groups instead of relying on a one-size-fits-all mass marketing approach which could be ineffective. Broad segments typically are geographic, demographic, psychographic (Values, Attitudes, Lifestyles) and behavioral. 

Segmentation to be useful must result in segments that pass five key criteria: they must be measurable, substantial, accessible, differentiable and actionable. Cost of time and resources, accuracy, too narrow a focus, not recognizing shifts in market and consumer behavior after the segmentation are among the traps to avoid.

Based on the insights from segmentation, a firm can decide its zone of market focus: Niche within a segment, segment, multiple segments or mass market. 

Dr DP