Reply for Petra Mizzi Segmentation

M‌‍‍‌‌‍‌‌‌‌‌‍‍‍‌‌‌‌‍arket segmentation is the method of dividing the “market into groups of similar customers” and identifying the differences between them (Hooley et al., 2020:107). Market segmentation looks into how to effectively divide the market, it identifies the customers who belong to different customer profiles and develops segment descriptions. Segmentation is a fundamental aspect of market strategy since it allows companies to differentiate themselves from the competition. “Until competitors copy or segment your segmentation, you have a competitive edge, even if you serve the segment with a standard product or service. If the product or service is specific to the segment then your competitive advantage is multiplied” (McBurnie and Clutterbuck, 1988). For segmentation to be effective marketers must identify the differences between customers in the consumer market. Although “all customers differ in some respect”, one must identify which differences are related to different behaviour patterns Segment targets should also be identifiable by measurable characteristics as well as ensuring that the chosen segments “be isolated from the rest of the market” (Hooley et al., 2020 : 109). This allows marketers to target these customers with a “distinct market offering” (Hooley et al., 2020 :109). Marketeers segment the consumer market based on characteristics of customers, customer attitudes and behaviour. Hooley et al. (2020) outlines two different approaches marketers can take to segmenting a market. The first being priori segmentation and the second being post hoc segmentation. Priori segmentation “u‌‍‍‌‌‍‌‌‌‌‌‍‍‍‌‌‌‌‍ses schemes that are in the public domain and hence also available to competitors” (Hooley et al., 2020:125). Whereas post hoc segmentation does not outline the final segmentation immediately. The segmentation of the market can be multidimensional, when marketers use this type of segmentation data which is collected through qualitative and quantitative market research. This data is then analysed to identify patterns in the market. Through this research the customer segmentation is created (Hooley et al., 2020). Companies make use of both priori and post hoc segmentation. A good example of priori segmentation is travel agencies who offer customers pre planned tours to foreing countries. ROCS travel, a Maltese travel agency offers customers various packages and trips. Age is a great segmentation factor and ROCS travel has created these tours specifically to target anyone who is over 50. Apart from travel agencies what other types of businesses do you think would use priori segmentation?

 References:

Camilleri, A. (2018) ‘Market Segmentation, Targeting and Positioning’, in: Camilleri, A. (eds) Travel Marketing, Tourism Economics and the Airline Product. United States: Springer. 69-83. Dibb, S. (1998) Market segmentation: strategies for success. Marketing Intelligence & Planning 16(7): 394-406.  DOI: https://doi.org/10.1108/02634509810244390 

Hooley, G., Nicoulaud, B., Rudd, J., Piercy, N. and Lee, N. (2020). Marketing Strategy and Competitive Positioning. 7th Ed. Harlow: Pearson International Content. McBurnie, T. & Clutterbuck, D. (1988) Give Your Company the Marketing Edge. Lond‌‍‍‌‌‍‌‌‌‌‌‍‍‍‌‌‌‌‍on: Weidenfeld & Nicolson

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