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The right target market

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Introduction

One of the most important marketing functions for a firm is finding the right target market. A target market by definition is: "a group of consumers at whom the seller specifically aims its marketing efforts". Identification and selection of the target market is crucial for a firm's marketing strategy to be effective. In the process of finding the target market the first and probably the most crucial step is market segmentation. Market segmentation in general is differentiating groups of people in the market, so that the firm may find similarities between certain groups and therefore construct a target market. Many companies' previously developing products for diverse markets have found that the resource draws unsustainable as consumer demand has dwindled. This has led to greater emphasis on defining the characteristics of accessible and financially viable consumer groups in order to target the unique benefits of an existing product portfolio and rationalize production and marketing costs in the process. The nature of service sector products facilitates product and market differentiation with enhanced opportunities for cost control and productivity gains. A good market segmentation program in effect saves the company resources and hits the market exactly where the company has planned to do so. The process of market segmentation should always be practices within the parameters of the following criteria. The reason for this is that unrestrained segmentation may lead to an impossible amount of product modifications and later nullify all the benefits of the segmentation process as a whole. ...read more.

Middle

The first of the three post-paid divisions is SMART gold. The gold line is what you may call the best value for your money line. It is the basic SMART offer and is no-frills, value for money oriented. The target segment for smart gold are cell phone users aged 25-40 from social classes A,B, C1, C2, and C3 who don't really demand much from their cell phone providers except for the basic services like making and receiving calls and sending and receiving text messages. This target market comes from a mixture of the following segmentation variables. It is a combination of users in the Philippines which is a geographic variable. With demographic variables being all genders with no age limits and with an income that can sustain a cell phone line being the general income requirement. This division of Smart doesn't so much target social class or lifestyle, but what it lacks there it focuses more on the behavioral aspect. The target market here are the users who have a bigger than average usage rate for their cell phones so generally there are more free minutes and advantages offered with reference to heavy usage of the service. It is clear in this example that SMART has mixed 5 variables of the segmentation guideline to come up with a successful mix directed at their target market. ...read more.

Conclusion

Only those in the highest earning cut of the demographic were targeted, males and females who either own their own large companies or are CEO's of others were included. Most likely candidates for this market are of the age group 40's - late 60's. They are part of the elite and have a jet setting lifestyle most can only dream of, these clients know what they want and are willing to pay for it. And pay for it they do, with a price range starting from 5,000 pesos and ending at 10,000 pesos monthly fees SMART Infinity is the most expensive GSM service in the country. With a target market that only had approximately 400 people in it, SMART Infinity's success is yet to be seen. As it is made clear by the examples shown above; market segmentation is clearly not a product of just one variable but a delicate mix of multiple variables that the marketers take into consideration. It is through this delicate mix that most target markets are formulated and from those markets successful business' thrive. In the case of SMART it illustrates effective market segmentation from the beginning, as they observed a growing need not catered to by SMART Gold, and from there formulated a new mix of segmentation variables to come up with a smaller and better defined target market. And later launching a product designed for that target market Addict Mobile. Mixing and matching the different variables for the segmentation of a market is now the only way for this activity to be effective. 1 ...read more.

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