Answer to Question #314388 in Marketing for lady

Question

conduct a detailed discussion on the importance of benefits of segmenting and targeting markets for firms and include a myriad of national and international exapmles

Answer 1

Market segmentation involves dividing a large homogenous market of potential customers into clearly identifiable segments. Customers are divided based on meeting certain criteria or having similar characteristics that lead to them having the same product needs. Segments are made up of customers who will respond similarly to marketing strategies. They share common interests, needs, wants and demands.

The benefits include;

Market segmentation allows you to target your content to the right people in the right way, rather than targeting your entire audience with a generic message. This helps you increase the chances of people engaging with your ad or content, resulting in more efficient campaigns and improved return on investment (ROI).

Greater company focus

When a company has identified specific market segments, it helps them to focus on what segments they want to target with specific products/ services/ content/ blogs and campaigns. When a company has a focus on specific segments, they ensure they are targeting the right segment with the right product which will see the greatest ROI.

Better serve a customer’s needs and wants

Having defined segments enables companies to satisfy a variety of customer needs by offering different bundles and incentives. Different forms and promotional activities will be used for different segments based on that segments needs/ wants and characteristics.

Market competitiveness

When a company is focusing on a specific segment, their market competitiveness increases. Which in turn will lead to a higher ROI. The company is focused on specific segments and learns everything they need to know about that segment, to market their products to them.

Market expansion

With geographic segmentation as discussed earlier, market expansion is possible immediately. When a company understands their segments and how to market to a segment in a particular location, they can expand immediately into another nearby location. If segmentation is based on demographics, then once the company knows their demographic segment they can expand in that segment with similar products.

Targeted communication

Even when product features and benefits are the same, it is important for companies to target segments with specific communication. For example, if your segment was senior engineers, they may respond better to technical information about a product in the form of white papers or info graphics, but a project manager might respond better to information regarding cost savings, efficiencies etc. in the form of a blog, case study or video. Messaging will be different for different segments. Platforms which are used to target different segments will be different also. The key is to understand your segments and target communication relevant to them on the relevant platforms.

Why market segmentation is important?

When marketers use market segmentation it makes planning campaigns easier, as it helps to focus the company on certain customer groups instead of targeting the mass market. Segmentation helps marketers to be more efficient in terms of time, money and other resources. Market segmentation allows companies to learn about their customers. They gain a better understanding of customer’s needs and wants and therefore can tailor campaigns to customer segments most likely to purchase products.