Market Segmentation
A definition of market segmentation is groups of potential buyers that have two things in common, similar needs and a reaction to the marketing strategy. (Kerin, 188) There are four different segments to the market. They are geographic area, demographic focus, psychographic referring to lifestyle and behavioral which refers to where the person makes purchases, what they are looking for, how often they shop, and their reason for purchasing. (Kerin, 193)
A definition of target market is one or more groups of consumers that a company uses for purposes of market focus. The five criteria for selecting a target segment are, market size, growth expectation, competitive position, cost associated with reaching the segment, and compatibility with the objectives and resources of the organization. (Kerin, 198-199) where a target market is groups selected for company focus, market segmentation is used to divide potential buyers into more specific groups.
The statement, “ Sometimes a firm can achieve a key differential advantage by simply emphasizing how its offering satisfies existing consumer demands/desires and needs better than its competitors” can be very true in that a company can use what is already known about their customer base to identify their products best focus group. Companies can use this advantage to instill positive feeling about their products to their already existing customer base as well as competitor clientele. A marketing strategy called product repositioning can help a company to change the importance or usefulness of a product in a consumers mind in comparison to a competitor product. A company will use head to head positioning (pg. 202) in order to compete with suppliers of similar products. An example of this type of positioning is Pepsi vs. Coke. These two companies sell soda that the attempt to convince theirs and the opposing companies customers of buying.
An example of a company, product, and positioning strategy is Splash Lagoon Water
A definition of target market is one or more groups of consumers that a company uses for purposes of market focus. The five criteria for selecting a target segment are, market size, growth expectation, competitive position, cost associated with reaching the segment, and compatibility with the objectives and resources of the organization. (Kerin, 198-199) where a target market is groups selected for company focus, market segmentation is used to divide potential buyers into more specific groups.
The statement, “ Sometimes a firm can achieve a key differential advantage by simply emphasizing how its offering satisfies existing consumer demands/desires and needs better than its competitors” can be very true in that a company can use what is already known about their customer base to identify their products best focus group. Companies can use this advantage to instill positive feeling about their products to their already existing customer base as well as competitor clientele. A marketing strategy called product repositioning can help a company to change the importance or usefulness of a product in a consumers mind in comparison to a competitor product. A company will use head to head positioning (pg. 202) in order to compete with suppliers of similar products. An example of this type of positioning is Pepsi vs. Coke. These two companies sell soda that the attempt to convince theirs and the opposing companies customers of buying.
An example of a company, product, and positioning strategy is Splash Lagoon Water
References: Kerin, R. A., Hartley, S. W., & Rudelius, W. (2011). Marketing The Core (4th ed.). New York: McGraw-Hill/Irwin. http://www.splashlagoon.com/ web page. Splash Lagoon Water Park, Erie,PA