Essay on Market Segmentation

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Market Segmentation This document prepared and presented by Business Resource Software, Inc.

Market Segmentation The purpose for segmenting a market is to allow your marketing/sales program to focus on the subset of prospects that are "most likely" to purchase your offering. If done properly this will help to insure the highest return for your marketing/sales expenditures. Depending on whether you are selling your offering to individual consumers or a business, there are definite differences in what you will consider when defining market segments.

Category of Need The first thing you can establish is a category of need that your offering …show more content…

Improvement in market share/competitive position

Prospects might be new entrants to a competitive market. Need for education

Prospects might be businesses or individuals looking for books on business planning, or seminars on Total Quality Management. Involvement with social trends

Prospects might be businesses concerned with environmental protection, employee security, etc. or individuals who believe in say 'no' to drugs, anti-crime, etc. Specific - relating to product/service characteristics

Prospects might be businesses or individuals interested in safety, security, economy, comfort, speed, quality, durability, etc. Factors that segment prospects Having determined the more general segmentation characteristics you can proceed to a more detailed analysis of the market. There are literally thousands of ways to segment a market, but the following are some of the more typical segmentation categories.

For businesses: Industry by SIC code

This is especially beneficial for vertical market offerings. Size - revenues, # employees, # locations

In general if your offering is highly sophisticated, requires significant resources or

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