SEGMENTATION

 

SEGMENTATION

Meaning of market segmentation

Our country is big country having population of billions and a large geographic territory. In that case, it is not easy for any enterprise to design a product which meets with the requirements of people from different social and cultural backgrounds, perceptions, languages and buying habits. Different customers take a product by different attributes, features, functions and quality levels. Some people are ready to pay a high price for quality products, while for others the economical pricing matters a lot. Thus, it becomes important for the marketers to identify the various consumers segments that they can serve most effectively. Therefore, instead of producing a common product and targeting it to all, the organization must have to design an exclusive product for a specific consumer segment.

Market segmentation is the process of grouping buyers into different categories having common desires or needs. In other words, Market segmentation is a method of dividing a large market into smaller groupings of consumers in which each segment has common characteristics such as need or behaviour.

Market segmentation is just the first step in a three-phase marketing strategy. After segmenting the market into homogeneous clusters, the marketer must select one or more segments to target. So the second step is target marketing, which is the process of evaluating each market segment’s attractiveness and selecting one or more segments to enter.

Market segmentation is the process of sub-dividing market into homogeneous sub-section of customers with common needs, goals, characteristics and behaviour tendencies to targets with a distinct marketing mix.

Definitions of market segmentation

1. According to Cundiff and Still "Market segments are grouping of consumers according to such characteristics, income, age, degree of urbanization, race or ethnic classification, geographical, location or education.''

 

2. According to Philip Kotler, “Market segmentation is the sub-dividing of market into homogeneous sub-sections of customers, where any sub-section may conceivably be selected as a market target to be reached with a distinct marketing mix.”

 

3. According to Stanton, “Market segmentation consists of taking the total heterogeneous market for a product and dividing it into several sub-markets or segments, each of which tends to be homogeneous in all significant aspects.”