MANAGEMT7104 | Management | Analysis Of The Market Segmentation

Answer:

Importance of Market Segmentation in Small and Medium Sector Organizations

Market Segmentation is defined as the entire process of dividing the large market into the clearly small and identified market segments that are having the same kinds of demands along with the characteristics (Cho, Bonn & Brymer, 2017). The main target is to create a proper marketing campaign which mainly focuses on the specific segment of the different customers. It helps in creating sub-sets of the market based on the same kind of characteristics of the different customers with similar needs along with demands along with satisfying their needs in much better manner.

There are various kinds of benefits along with importance of the market segmentation which can be gained by the different organizations in an efficient manner. There are various divisions of the market segmentation which are required to be analysed in order to analyse the different benefits of the same in managing the effectiveness of the organization in different regions. The different importance of the market segmentation is inclusive o following:

Firstly, this will be essential and helpful in analysing the needs of the different customers along with targeting the marketing strategy at particular group. Furthermore, this is successful in nature in order to create along with promote the customized along with specific products along with services.

Secondly, mass marketing is the strategy wherein targeting along with positioning of the different customers helps in creating new potential customers and generating the new ideas for the various other new products along with services (Cross, Belich & Rudelius, 2015). This will be helpful for the different companies in becoming more effective and this will help in maximising the potential profit as well (Weinstein & Cahill, 2014).

Retaining the different customers is the great way in retaining the different customers and the different organizations will be able to create establish long-term relationship which will be helpful in gaining competitive advantage and gain more maximum value and benefit (Dolnicar et al., 2014).

With the implementation of the market segmentation, this will enable the different organizations in utilising the different resources of the organization in such a manner which will assist in producing the right type of products for the right kind of customers in the entire market (Müller & Hamm, 2014). The segmentation is the most essential element in all the organizations as this helps them in dividing the target customers and market as per their demands.

The segmentation of the business along with the consumer markets is essential in nature which helps in maintaining the existing kind of market along with expanding the same effectively. The successful kind of organization is required to gain competitive advantage by looking at the different needs of the customers in an efficient manner and this will enhance in devising the different strategies which will provide maximum benefit and value (Legohérel, Hsu & Daucé, 2015).

As the result of the segmentation of the market, the different organizations help in treating the different customers in a more effective manner than the other competitors in the overall competitive work environment (Hatheway, Kwan & Zheng, 2017). This helps in improving the overall competitive advantage and strength of the organization efficiently and this will help in preventing the entry of the different competitors and this will provide the strength to defeat the different other competitors in the entire market which is competitive in nature (Venter, Wright & Dibb, 2015).

From the above, this can be analysed that these are the major importance of the segmentation of the market in different companies. With the implementation of the segmentation of market, this will help in benefitting both the nation along with the society along with the contribution towards the overall national development as well. Lastly, identification of the different opportunities of the market is required to be identified in analysing the overall efficiency in the market.

Conclusion

Therefore, this can be concluded that market segmentation plays a major role in managing the overall effectiveness of the small and medium sector enterprises in an appropriate manner. The market segmentation assists such kind of organizations in establishing the close relationships with the specific group of the buyers and this helps in facilitating the continuous generation of profits effectively as well. The customers with the disposable kind of income can help such scale companies to generate huge profit effectively.

Moreover, this can be seen and noticed that this will help in benefitting the small-scale industrial units efficiently which will be help in functioning on limited scale of operations. By concentrating on the demand of the specific kind of group in the market, this will help in making the market profitable in nature and gain more competitive advantage in the overall market which is competitive.

References

Cho, M., Bonn, M. A., & Brymer, R. A. (2017). A constraint-based approach to wine tourism market segmentation. Journal of Hospitality & Tourism Research, 41(4), 415-444.c

Cross, J. C., Belich, T. J., & Rudelius, W. (2015). How marketing managers use market segmentation: An exploratory study. In Proceedings of the 1990 Academy of Marketing Science (AMS) Annual Conference (pp. 531-536). Springer, Cham.

Dolnicar, S., Grün, B., Leisch, F., & Schmidt, K. (2014). Required sample sizes for data-driven market segmentation analyses in tourism. Journal of Travel Research, 53(3), 296-306.

Hatheway, F., Kwan, A., & Zheng, H. (2017). An Empirical Analysis of Market Segmentation on US Equity Markets. Journal of Financial and Quantitative Analysis, 52(6), 2399-2427.

Legohérel, P., Hsu, C. H., & Daucé, B. (2015). Variety-seeking: Using the CHAID segmentation approach in analyzing the international traveler market. Tourism Management, 46, 359-366.

Müller, H., & Hamm, U. (2014). Stability of market segmentation with cluster analysis–A methodological approach. Food Quality and Preference, 34, 70-78.

Venter, P., Wright, A., & Dibb, S. (2015). Performing market segmentation: a performative perspective. Journal of Marketing Management, 31(1-2), 62-83.

Weinstein, A., & Cahill, D. J. (2014). Lifestyle market segmentation. Routledge.