Market Segmentation

Businesses built for profit purposes are under pressure by their owners to make money. Sometimes the type of business or the condition of the market for that business is a strong factor in how much money a business will make. Otherwise, a business may need to study marketing tactics, like market segmentation, to boost and improve profits. 

Mark Moncher a Senior Business Development Executive say that the process of market segmentation involves analyzing the consumers within a specific market. Using the data attained, the consumer market is divided up into segments. The variables that define each segment define the future marketing approaches that will be taken for that segment. By taking strong consideration of its consumer base, this is a very calculating way to make more money with a business.

"Different types of factors are used to divide up the consumer base that a company is pursuing" says Mark Moncher. First, the business needs to ensure with the use of market segmenting that the consumer base or market they are analyzing is for them. Next, they must decide what it is they wish for from the customers in terms of profit and retaining ability. Then, the business must check these against its own needs and expectations. Is the business under pressure to match a certain profit margin? Is it attempting to be innovative in its field? Market segmentation helps with this.

Each segment defined by marketing segmentation must be homogenous unto itself. It must also have heterogeneity from other segments. It's through the similarities of consumers within a segment and knowing the differences between segments, that a business can create the most appropriate retention programs. 

When a segment is defined by market segmentation as being homogenous, it has specific traits that are unique to just that segment. Different things can decide what traits a segment is characterized by. Demographics, industry and other factors help to show a segment's traits. All of the consumers with a segment will have things in common with the other consumers in their segment. 

Different consumer segments must also have heterogeneity from other segments. The use of market segmentation will help in demonstrating this. Consumers of one segment will not have traits in common with consumers of another segment. Retention programs are best suited to specific market segments. If there is an overlap, profits may be spent unnecessarily on retention programs that suit multiple segments but are not specifically segment oriented. 

A strong purpose of marketing segmentation is that of helping a business to create appropriate retention programs for their consumers. Segments are analyzed and specific questions are asked of each in terms of business and profit. Is this particular group or segment at risk of becoming non-customers of the business? Is it money-worthy to work or put out effort to retain these customers? What is the best way to retain this segment and these customers using the data that has been attained? 

According to EFG Marketing, the retention strategies a business uses with future consumers can get quite a boost in the right direction if there is market segmentation done. Market segmentation is an eye-opening EFG Marketing Solutions strategy that will likely help any business in the end. 

Mark Moncher Senior sales and business development executive has lead national and regional sales teams across US for Merchant Acquisition and Optimization. He has the strong passion that drives the dedication and focus is second to none and consistently high leadership scores year after year drive a winning attitude across the organization.

Read more articles by Mr. Moncher click here