Question

In: Accounting

Is market segmentation always a good idea? Under which conditions, if any, might segmentation be unnecessary...

Is market segmentation always a good idea? Under which conditions, if any, might segmentation be unnecessary or unwise?

need help to make a discussion for the class of marketing in healthcare.

Solutions

Expert Solution

Market segmentation: Process of dividing the customer base into some groups having similar characteristics.

No, market segmentation is not a good idea "ALWAYS"!

Segmentation is a very good idea to a certain extent but beyond that it doesn't reap any extra benefits. Conditions were segmentation is unwise:

1. Suppose a company has already created optimum segments and now again it wants to further specialise the segments, in this case further segmentation will add to the costs of the company and in no way give benefits.

2. When the company is in its initial stages of operation, in this case also it is not a very good idea to create segments. This will add to extra stress on existing manpower.

3. In cases where distinction between two segments is negligible. In this situation customers will not have any specific differences in fheir minds and hence no benefit to company.

4. When company doesn't have huge funds to market their segments, then creating more segments is unwise.

Conclusion: Hence segmentation is very good but above aspects should be kept in mind. This list is inclusive and not exhaustive.


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