market segmentation process the targeting strategy and positioning of the product influence a company s decisions
Introduction The central philosophy of marketing is to identify and attempt to satisfy the needs and wants of the consumer and to persuade individuals to buy the product the company offers. ... Target marketing is made up of three distinct stages: market segmentation, market targeting and product positioning. Target marketing will be strongly interrelated with the marketing mix, which the firm will need to develop to sell the particular product. The assignment will show how these ideas will appear in the case of a fast-moving consumer goods company, namely Unilever. Background of target marketing- Heterogenity of the market As a consequence of differences between the needs and wants of consumers a single firm with a homogenous product will not be able to meet the requirements of all people. The market is made up of numerous subgroups, sub-markets which will all require a different approach from the side of the firm offering products. Firms will be more succesful if they attempt to satisfy the wants of these sub-markets for a particular product instead of trying to serve the entire population. The method of target marketing will allow the firm to concentrate on a carefully selected part or subgroup of the entire market. There is hardly any product that would satisfy the needs of all people, thus product differentiation has gained ground. ... They have realised that the market is built up of segments. Each segment has its own identifiable requirements towards a certain product. Market segmentation Market segmentation is the first stage in target marketing. This process divides the market into segments, sub-markets by easily identifiable characteristics. If segmentation was effective members of a particular distinct group would have the same requirements towards a product and would react very similarly to the marketing mix of the firm. Market segmentation involves the identification of the bases for segmentation and determines important characteristics of each market segment. Segmentation is usually based on any of the following four categories.