Quiz 6: Target Markets: Segmentation and Evaluation

Business

Market segmentation: It is the strategy which is used by marketers for dividing the total market in groups that relates to people having similar needs and desires. These groups are then known as target market. For every target market, a different marketing mix may be designed that meet the requirements of the customers of that market segment. For example, a luxury hybrid car Lexus 660h L that has a base price of more than $100,000 is targeted at high net worth individuals who are conscious about environment pollution. This car is not purchased by mass market. Another example, customized luxury cars like Mercedes, BMW, Porsche and Aston Martin again targeted at high net worth individuals. These cars have price range in millions of dollars and can only be afforded by individuals like politicians, celebrities and industrialists.

Trek uses undifferentiated marketing strategy, in which the target customer is from almost every segment. In other words, undifferentiated marketing strategies ignore segment marketing and target each and every group of customers. It manufactured bicycles by keeping in mind the below category of people: • mountain biking • stylist bicycle for urban population • bicycle for professionals • shock absorber bicycle for riders • bicycle for women • bicycle for children • cheap bicycle for rural population From the above different categories of people, it is clear that they didn't focussed on only a single targeted group. It gives the proof that they follow the undifferentiated marketing strategy to cover all customers groups irrespective of the gender as well.

A market is comprised of all actual and potential buyers who need products in a particular category and have the ability, willingness, and authority to buy those products. Market Requirements To be part of a market, an individual is required to have • Need or desire for a particular good/service. • Ability (the money) to buy the good. • Willingness to use his/her purchasing power. • Authority to buy such goods. For instance, a billionaire may have the ability, willingness and authority to buy a vintage car, but he may not have the need or desire for it. An individual or a group of individuals lacking even one of the four requirements would not constitute a market.