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Market segmentation is the process of dividing mass markets into groups with similar needs and wants. [2] The rationale for market segmentation is that in order to achieve competitive advantage and superior performance, firms should: "(1) identify segments of industry demand, (2) target specific segments of demand, and (3) develop specific 'marketing mixes' for each targeted market segment ...
In marketing, segmenting, targeting and positioning (STP) is a framework that implements market segmentation. [1] Market segmentation is a process, in which groups of buyers within a market are divided and profiled according to a range of variables, which determine the market characteristics and tendencies. [2]
RFM is a method used for analyzing customer value and segmenting customers which is commonly used in database marketing and direct marketing. It has received particular attention in the retail and professional services industries. [1] RFM stands for the three dimensions: Recency – How recently did the customer purchase?
Industrial market segmentation is a scheme for categorizing industrial and business customers to guide strategic and tactical decision-making. Government agencies and industry associations use standardized segmentation schemes for statistical surveys. Most businesses create their own segmentation scheme to meet their particular needs.
Market segmentation is the basis for a differentiated market analysis. Differentiation is important. One main reason is the saturation of consumption, which exists due to the increasing competition in offered products. Consumers ask for more individual products and services and are better informed about the range of products than before.
Segmentation: refers to the process of dividing a broad consumer or business market, normally consisting of existing and potential customers, into sub-groups of consumers (known as segments) [25] Targeting: refers to the selection of a segment or segments that will become the focus of special attention (known as target markets). [26]
Marketing research is the systematic gathering, recording, and analysis of qualitative and quantitative data about issues relating to marketing products and services. The goal is to identify and assess how changing elements of the marketing mix impacts customer behavior.
Approaches to segmentation will vary depending on whether the total available market (TAM) is a consumer market or a business market. Market segmentation is the process of dividing a total available market, using one of a number of key bases for segmenting such as demographic, geographic, psychographic, behavioural or needs-based segments.