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Article
Publication date: 1 February 1996

Malcolm Wright

Discusses Mitchell’s recent proposal for astrological segmentation which demonstrates the extremes to which segmentation and targeting can be taken if we uncritically…

9495

Abstract

Discusses Mitchell’s recent proposal for astrological segmentation which demonstrates the extremes to which segmentation and targeting can be taken if we uncritically accept their core assumptions. Proposes that although Mitchell’s proposal can be subjected to a number of minor criticisms, it can only be finally disposed of by critically examining whether astrological segments really are associated with a stable set of preferences, and whether targeting these segments actually gives a higher return than other approaches. Once the stability of segments, the logic of targeting, and the empirical evidence are examined, it turns out that not only is Mitchell’s approach unsupported, but so are most other segmentation and targeting efforts.

Details

Management Decision, vol. 34 no. 1
Type: Research Article
ISSN: 0025-1747

Keywords

Article
Publication date: 22 August 2008

Lyndon Simkin

The creation of a target market strategy is integral to developing an effective business strategy. The concept of market segmentation is often cited as pivotal to…

15517

Abstract

Purpose

The creation of a target market strategy is integral to developing an effective business strategy. The concept of market segmentation is often cited as pivotal to establishing a target market strategy, yet all too often business‐to‐business marketers utilise little more than trade sectors or product groups as the basis for their groupings of customers, rather than customers' characteristics and buying behaviour. The purpose of this paper is to offer a solution for managers, focusing on customer purchasing behaviour, which evolves from the organisation's existing criteria used for grouping its customers.

Design/methodology/approach

One of the underlying reasons managers fail to embrace best practice market segmentation is their inability to manage the transition from how target markets in an organisation are currently described to how they might look when based on customer characteristics, needs, purchasing behaviour and decision‐making. Any attempt to develop market segments should reflect the inability of organisations to ignore their existing customer group classification schemes and associated customer‐facing operational practices, such as distribution channels and sales force allocations.

Findings

A straightforward process has been derived and applied, enabling organisations to practice market segmentation in an evolutionary manner, facilitating the transition to customer‐led target market segments. This process also ensures commitment from the managers responsible for implementing the eventual segmentation scheme. This paper outlines the six stages of this process and presents an illustrative example from the agrichemicals sector, supported by other cases.

Research implications

The process presented in this paper for embarking on market segmentation focuses on customer purchasing behaviour rather than business sectors or product group classifications ‐ which is true to the concept of market segmentation ‐ but in a manner that participating managers find non‐threatening. The resulting market segments have their basis in the organisation's existing customer classification schemes and are an iteration to which most managers readily buy‐in.

Originality/value

Despite the size of the market segmentation literature, very few papers offer step‐by‐step guidance for developing customer‐focused market segments in business‐to‐business marketing. The analytical tool for assessing customer purchasing deployed in this paper originally was created to assist in marketing planning programmes, but has since proved its worth as the foundation for creating segmentation schemes in business marketing, as described in this paper.

Details

Journal of Business & Industrial Marketing, vol. 23 no. 7
Type: Research Article
ISSN: 0885-8624

Keywords

Article
Publication date: 1 June 1996

Erwin Danneels

States that market segmentation is one of the most important concepts in marketing, though little has been published about its application in business practice. Explores…

5553

Abstract

States that market segmentation is one of the most important concepts in marketing, though little has been published about its application in business practice. Explores the application of segmentation in Belgian apparel retailing. Compares the views and practices emerging from in‐depth interviews with 22 retail practitioners and six industry experts and contrasts them with the normative segmentation model. Concludes that the retail mix evolves through a cyclical process rather than a linear sequence, and that the segmentation model is more a normative than a descriptive model of retailer behaviour. The data suggest that a simple sequence fails to capture the ongoing iterative process by which retailers adjust their market offerings. Finds that the target market emerges from this process of interaction with the marketplace. Marketing academicians are encouraged to root their work in business practice.

Details

European Journal of Marketing, vol. 30 no. 6
Type: Research Article
ISSN: 0309-0566

Keywords

Article
Publication date: 1 February 2002

Geng Cui and Pravat Choudhury

As the population and purchasing power of ethnic minority consumers in the USA continue to grow, more marketers are using subcultural segmentation and targeted marketing…

14624

Abstract

As the population and purchasing power of ethnic minority consumers in the USA continue to grow, more marketers are using subcultural segmentation and targeted marketing to reach these consumers. Meanwhile, some marketers have grown increasingly concerned with the cost‐effectiveness of ethnic segmentation and differentiated marketing. This research reviews various methods for segmenting the ethnic markets and suggests the nested approach and cost‐benefit optimization for analyzing the cost‐effectiveness of ethnic segmentation and marketing. Furthermore, this research proposes four alternative strategies for marketing in a multicultural environment. Directions for future research and managerial implications are explored.

Details

Journal of Consumer Marketing, vol. 19 no. 1
Type: Research Article
ISSN: 0736-3761

Keywords

Article
Publication date: 20 September 2011

Lyndon Simkin and Sally Dibb

This paper aims to explore how segmentation is often undertaken in practice, highlighting problems commonly encountered. It is based on the deregulated and highly…

4748

Abstract

Purpose

This paper aims to explore how segmentation is often undertaken in practice, highlighting problems commonly encountered. It is based on the deregulated and highly competitive UK market for energy, namely gas and electricity supply. The case is appropriate for modules in marketing strategy, target marketing and marketing management, at MBA, MSc or advanced UG levels.

Design/methodology/approach

The case highlights why this organisation opted for segmentation, how it conducted this project, and the problems faced. These insights are referenced with the segmentation literature.

Findings

With little product differentiation possible, gas and electricity tend to be price‐driven purchases, which increases the importance of effective segmentation and shrewd target segment selection. Both consumer and business segments are cited, but the case focuses more on the business‐to‐business outcomes. The approach adopted for selecting which segments to target is also featured. This case explores the use of market segmentation and the practical difficulties encountered. The solutions to these difficulties are highlighted.

Research limitations/implications

The case could not disclose the company's identity, but provides an insightful explanation of how segmentation may be conducted and the problems encountered. There is bias towards business segments, rather than consumer ones.

Practical implications

Readers will be made aware of the impediments facing effective execution of market segmentation and be well prepared to spot such difficulties in any such projects that they might undertake.

Originality/value

Few cases explore the practical issues encountered during segmentation or the creation of a new target market strategy. These difficulties are addressable, but only if they are anticipated or identified expediently. This paper provides such warnings and guidance.

Details

Marketing Intelligence & Planning, vol. 29 no. 6
Type: Research Article
ISSN: 0263-4503

Keywords

Article
Publication date: 1 February 1997

Dennis J. Cahill

Discusses Wright’s recent attack on targeting and segmentation theory. Proposes that, although Wright has some valid criticisms about specific applications of the…

26992

Abstract

Discusses Wright’s recent attack on targeting and segmentation theory. Proposes that, although Wright has some valid criticisms about specific applications of the concepts, targeting and segmentation are acceptable and defensible marketing strategies if properly designed. Gives some indications of possible methods for segmenting that may meet Wright’s criticisms.

Details

Management Decision, vol. 35 no. 1
Type: Research Article
ISSN: 0025-1747

Keywords

Book part
Publication date: 26 February 2008

Leslie H. Vincent

This chapter provides an overview of the marketing strategy development process in the commercialization of breakthrough technologies. Important concepts and elements that…

Abstract

This chapter provides an overview of the marketing strategy development process in the commercialization of breakthrough technologies. Important concepts and elements that are considered critical when developing market applications are presented with emphasis on three key decisions: target market selection, segmentation, and positioning. These strategic decisions will guide the more tactical considerations relating to the specific elements, or marketing mix, of the product's marketing strategy. Marketing strategy development is a dynamic process impacted by many factors. This chapter highlights the dynamic nature of this process as well as provides insight into the fundamental considerations in strategy formulation.

Details

Technological Innovation: Generating Economic Results
Type: Book
ISBN: 978-1-84950-532-1

Article
Publication date: 4 January 2016

Timo Dietrich, Sharyn Rundle-Thiele, Lisa Schuster and Jason P. Connor

Social marketing benchmark criteria were used to understand the extent to which single-substance alcohol education programmes targeting adolescents in middle and high…

1397

Abstract

Purpose

Social marketing benchmark criteria were used to understand the extent to which single-substance alcohol education programmes targeting adolescents in middle and high school settings sought to change behaviour, utilised theory, included audience research and applied the market segmentation process. The paper aims to discuss these issues.

Design/methodology/approach

A systematic literature review retrieved a total of 1,495 identified articles; 565 duplicates were removed. The remaining 930 articles were then screened. Articles detailing formative research or programmes targeting multiple substances, parents, families and/or communities, as well as elementary schools and universities were excluded. A total of 31 articles, encompassing 16 qualifying programmes, were selected for detailed evaluation.

Findings

The majority of alcohol education programmes were developed on the basis of theory and achieved short- and medium-term behavioural effects. Importantly, most programmes were universal and did not apply the full market segmentation process. Limited audience research in the form of student involvement in programme design was identified.

Research limitations/implications

This systematic literature review focused on single-substance alcohol education programmes targeted at middle and high school student populations, retrieving studies back to the year 2000.

Originality/value

The results of this systematic literature review indicate that application of the social marketing benchmark criteria of market segmentation and audience research may represent an avenue for further extending alcohol education programme effectiveness in middle and high school settings.

Details

Health Education, vol. 116 no. 1
Type: Research Article
ISSN: 0965-4283

Keywords

Book part
Publication date: 2 August 2016

Leslie Vincent

This chapter provides an overview of the marketing strategy development process in the commercialization of breakthrough technologies. Important concepts and elements that…

Abstract

This chapter provides an overview of the marketing strategy development process in the commercialization of breakthrough technologies. Important concepts and elements that are considered critical when developing market applications are presented with emphasis on three key decisions: target market selection, segmentation, and positioning. These strategic decisions will guide the more tactical considerations relating to the specific elements, or marketing mix, of the product’s marketing strategy. Marketing strategy development is a dynamic process that is impacted by many factors. This chapter highlights the dynamic nature of this process as well as providing insight as to the fundamental considerations in strategy formulation.

Details

Technological Innovation: Generating Economic Results
Type: Book
ISBN: 978-1-78635-238-5

Keywords

Article
Publication date: 20 July 2012

Rusnah Muhamad, T.C. Melewar and Sharifah Faridah Syed Alwi

The purpose of this paper is to explore the different segments of consumers in the Islamic financial services industry (IFSI) and their relationship with product/brand…

6992

Abstract

Purpose

The purpose of this paper is to explore the different segments of consumers in the Islamic financial services industry (IFSI) and their relationship with product/brand positioning for Islamic financial services (IFS).

Design/methodology/approach

In‐depth interviews were conducted with individuals in managerial positions among the key market players in the IFSI to explore the segmentation of consumers and their buying motives.

Findings

Four segments of IFS consumers emerged, namely, Religious conviction group; Religious conviction and economic rationality group; Ethical observant group; and Economic rationality group. These segmentation groups were appropriately categorized through a psychographic (value)‐based approach.

Research limitations/implications

The empirical findings of this study pave the way for embarking on promising and relevant future research, which is needed to substantiate and enrich the academic understanding and managerial practice of linking market segmentation and brand positioning for IFS in the global market. Future research should focus on analysing these issues from the perspective of consumers of IFS to identify the purchase trend.

Practical implications

The study provides empirical evidence of the bases or initial dimensions of consumer segmentation for IFS. The findings are useful in guiding the management of institutions offering IFS in making decisions relating to the marketing communication and promotion strategy as well as product and brand positioning strategy.

Originality/value

For both academia and the IFSI, this study provides useful knowledge in strategically using market segmentation to position IFS in the global market.

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