Question

in 250 words or more describe Exactly what is the relationship between segmentation, target marketing, and positioning? What damage will be done to a company's target market and positioning efforts if markets are incorrectly segmented?

Answer 1

Today's world most of the companies are moving away from mass marketing and adopting target marketing approach. The Business which need to practice target marketing effectively are needs to take three steps. Those are market segmentation, market targeting and market positioning. Segmentation is the process of dividing broad market into small segments which involves the customers who thinks on the same line & shows interest towards similar product & brands. The individuals in the specific segment respond to similar market fluctuations & they need similar products. Segmentation allows you to identify target markets and position your business as the first one to serve it. The market segmentation is also called as Grouping. A good market segmentation will provide the company with clear direction to move forward with the idea of which market is best.

Once the marketer creates the different segments within the market , then he devises different marketing strategies & promotional schemes based on the tastes of individuals in the particular segments, This process is called as target marketing. It is very important to select the target market to which the organization decides to serve, because knowledge about how the customer decides, what are the criteria for buying a product, life style of the customer will help the marketer to develop best marketing strategies. By knowing when and whom to market your product or service will result in much higher rates of return.

Positioning is the last step. Once the company decides on its target market, It tries hard to create an image of it's product in the minds of the customer. Positioning depends on the market structure, competitive positions of the company & the concept of substitution & competition among the products. Positioning is the process by which you position your market & communicate the advantages to potential customer with the aim of convincing them to believe your product or service is better than those of the competitors.

The good market segmentation will provide the high share of potential profitability to the company and can easily be identified in the population or in customer databases. If the market segmentation is done incorrectly it will negatively affect your target market and positioning effort. It is waste of your time, money and energy and it will become a quickly discarded waste of resources gathering dust on a shelf. The final goal of market segmentation is to yield the distinct, highly profitable market, improve the marketing efforts and , boost the market share and profits.