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Strategy Question: How do I better understand the make-up of my overall market?

Summary: Assuming that the market has been properly sized, it is important to also spend similar effort to define segments and size these appropriately. This tool basically mirrors the approach of the Bottom-up Market Sizing Tool. At this stage, emphasis turns to breaking the overall market into actionable segments. Two to three iterations again are common to improve accuracy. The tool output casts the segments as a rectangular graphic, made up of one column for each segment. Segment width is representative of its size relative to the other segments. The width of all segment columns, added together, ties back and equals the overall size of the markets. The result provides guidelines for determining strategic market segments and niches, and how to best position the firm within those segments.

Strategy Question: Now that my market is sized and segmented, how do I better understand segment niches?

Summary: The Segment Niching Tool gets to the next important level of detail in the understanding of an organization’s environment. We use the Market Segmentation Tool output as a starting point. Here we further carve out key niches for further understanding related to product or service offerings. We add a scale to the segment columns of the Segment Niching Tool, and break the column further into sections whose size represents the percent of that niche to the segment. Like the segmentation tool above, understanding niches within the segments provides important information within the competitive environment. Here is where people can get mired down in infinite ways to niche a segment. We introduce our approach, based on numerous scars of wisdom, of niching based on only two questions: (1) “Why they buy?” — the main reason the product or service is purchased, and (2) “How they buy?” — the main way the product or service is purchased.

Segmentation is an important marketing concept that identifies and analyzes different needs and wants of buyers as well as their buying behavior. Two different perspectives on how buyers and potential customers should be approached have emerged over the last two decades: the transactional perspective and the relational perspective. The two approaches differ in their overall understanding of the customer and how to address the customer. The two approaches therefore hold different implications for how segmentation should take place and how markets should be monitored.

Studies of the social construction of markets have not determined which social environments, which we refer to as proximate social space, are most likely to trigger social construction processes. We find that U.S. nonprofit fiscal sponsors respond to greater potential for category emergence when proximate social space is defined by geography but not by market segment. Further, in addition to responding to potential claimants based on geographic peers, organizations also respond to actual claimants based on peers in the market segment. The pattern suggests that geographic social proximity triggers initial label claiming, which in turn triggers responses from market segment peers.

Strategy Question: Is there a simple yet comprehensive way to characterize the business health of my markets, segments, and niches?

Summary: Now that we have the markets segmented and niched, we need to research each segment relative to attractiveness. This can be simply an indication of segment growth prospects in the chosen planning horizon, or it can be a conglomeration of key elements important to the organization (market strength, opportunity for growth, margin yield opportunity, etc.). This tool takes the user through ways to evaluate the segments for use in prioritizing the importance of various segments to product/service and channel actions. We build on either the Market Segmentation Tool or the Segment Niching Tool by assigning an attractiveness code to the column heading (green, yellow, or red). We then recommend the organization rank order the segments, with the one chosen most attractive positioned on the far left, and those next bests located in decreasing order to the right. We have found the resulting one-page Market Map Tool output extremely helpful in simply conveying what is usually a difficult and very complex picture to explain and communicate.

The purpose of the study is to propose a normative approach for market segmentation, profile and monitoring using computing and information technology to analyze User-Generated Content (UGC).

The specific steps include performing a structural analysis of the UGC and extracting the base variables and values from it, generating a consumer characteristics matrix for segmenting process, and finally describing the segments' preferences, regional and dynamic characteristics. The authors verify the feasibility of the method with publicly available data. The external validity of the method is also tested through questionnaires and product regional sales data.

The authors apply the proposed methodology to analyze 53,526 UGCs in the New Energy Vehicle (NEV) market and classify consumers into four segments: Brand-Value Suitors (32%), Rational Consumers (21%), High-Quality Fanciers (26%) and Utility-driven Consumers (21%). The authors describe four segments' preferences, dynamic changes over the past six years and regional characteristics among China's top five sales cities. Then, the authors verify the external validity of the methodology through a questionnaire survey and actual NEV sales in China.

The proposed method enables companies to utilize computing and information technology to understand the market structure and grasp the dynamic trends of market segments, which assists them in developing R&D and marketing plans.

This study contributes to the research on UGC-based universal market segmentation methods. In addition, the proposed UGC structural analysis algorithm implements a more fine-grained data analysis.

Customer service represents a significant opportunity for segmenting markets. This article reviews the importance of customer service and the conceptual issues associated with segmenting industrial markets on the basis of customer service. A methodology is presented which can be used by managers to classify a market into segments with different customer service needs. Empirical results from a high‐technology industry are also presented. The article emphasises the need to recognise the differing customer service requirements of segments of customers when establishing priorities for customer service expenditures.

This paper’s main objective is to expand the demand-driven strategic field by developing a model where endogenization of consumers’ preferences for clean(er) products becomes the driver of the firm green corporate social responsible (GCSR) profit maximization behavior.

The model proposes that in undifferentiated markets, firms using a conventional technology manage production-related negative externalities via information asymmetries. In turn, when consumer socially responsible individuals (CnSR) discover the nature of the information asymmetries, they then reveal their preferences. The building block of the model is that CnSR derive value both from intrinsic as well as extrinsic product features, and derive negative satisfaction from the production negative externalities. In turn, CnSR preferences offer a higher willingness to pay for a combined intrinsic (private good and direct utility) and extrinsic (public good and feel good–do good utility) product.

The model demonstrates that the firm’s GCSR behavior is a technological-driven process directly affecting the extrinsic component of the product through the development of a safe technology, and exclusively targeting CnSR type of consumers. The corollary of the model is that for the firm pursuing a GCSR behavior, the development of a competitive advantage with higher firm performance leads to profit maximization when exclusively serving the GCSR segment of the market. Thus, GCSR is the result of unusual innovation efforts.

This paper presents a model that expands the field of strategic management through the demand-driven incorporation and respective modeling. To the best of the author’s knowledge, this is the first model to explicitly develop this relationship in this format.