Market segmentation is the process of dividing the market of potential customers into groups or segments. The segments created are composed of consumers who will react similarly to marketing strategies and have similar interests, needs or location characteristics.
Identify Market Opportunities
Review the needs of each segment and the current offers of competitors. Find out the current satisfaction of customers. Segments with low satisfaction represent excellent market opportunities.
Provide Better Service to Your Customers
Provide better service to your customers by concentrating your marketing efforts on a specific market area with market segmentation. Increase customer satisfaction with appropriate marketing segmentation.
Develop an Idea for Product Design
Market segmentation helps to design products that truly meet the demands of the target audience. Design and direct new products with high market potential that meet the satisfaction of the target market.
Reach the Right Market at the Right Time
Market Segmentation helps in setting the timings of the promotional efforts so that more emphasis is placed during those periods when response is likely to be at its peak. Focus on the promotional activities of the right market segment at the right time.
Get an Idea to Set Prices
Since different market segments have different price perceptions, adopt different pricing strategies. For example, optimize the prices of low income groups and revise product and promotional efforts.
Improve Marketing Programs
Instead of a marketing program aimed at attracting all potential buyers, create different marketing programs which designed to meet the needs of different customers. Make the right advertising and sales promotion decisions for the right audience.
Provide Help for Your Distribution Strategies
Segmentation also helps to identify appropriate delivery strategies. Different market segments may require different distribution mixes. For example, distribute your products to prestigious sales points for the high-quality market segment that targets the upper class.