Evaluating Market Segments

Date: 2015-10-07; view: 479.

Target marketing

After evaluating different segments, the company must decide which and how many segments it will target. A target market consists of a set of buyers who share common needs or characteristics that the company decides to serve. Market targeting can be carried out at several different levels.

In order to have efficient result in target marketing, there steps must be taken into account including 1) Evaluating Market Segments, 2) Selecting Target Market Segments, 3) choosing target Market Strategy.

In evaluating different market segments, a firm must look at three factors: segment size and growth, segment structural attractiveness, and company objectives and resources. The company must first collect and analyze data on current segment sales, growth rates, and the expected profitability for various segments. It will be interested in segments that have the right size and growth characteristics.

But “right size and growth” is a relative matter. The largest, fastest-growing segments are not always the most attractive ones for every company. Smaller companies may lack the skills and resources needed to serve larger segments

A company should enter only segments in which it can create superior customer value and gain advantages over its competitors.