We will discuss the Process of Market Segmentation
According to Philip Kotler (2006). Market segmentation is the act of identifying and profiling distinct groups of buyers who differ in their needs and preferences.
It is a process of identifying and profiling distinct groups of buyers based on requirements.
Process of Market Segmentation
The process of Market Segmentation consists of the following steps:
Investigating the market information about the customer nature, attitude, brand, loyalty, price value, perception, wage pattern, and other variables. Studying to market for managing groups based on similar preferences. Knowing about market features and characteristics. Like, customer needs and characteristics, brand awareness by customers, etc
We should do an evaluation of the data and information after collection. Factors affecting the demand are classified into major and minor factors. Major factors are studied in detail. Quantitative tools and techniques can be use for deciding possible segments.
Detail and micro-level study of all identified segments to know more information. Segmentation variables that can be used in segmentation are analyzed in detail. It also identifies similarities and dissimilarities of segments. Hance, A separate profile of each segment based on common criteria is prepare. They represent micro markets.
Comparing all the identified segments based on common criteria. It manages a way of choosing the best. Segments can be evaluated on the basis of cost, Revenue, Profit, Customer Volume, Growth Ratio, and Technology of the organization. Similarly Budget, Resources, Objectives, Social expectation, competition, ethical consideration, fulfillment of requirements such as measurable, divisible, accessible, substantial, etc. Markets keep on changing. Hence, market segmentation is necessary periodically.
Hence, we should follow above mention steps to select the best segments.
Other Important Links
Requirement for effective Segmentation: CLICK HERE
Benefits of Market Segmentation: CLICK HERE
Target Market: CLICK HERE