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Write a report advising Livelong how the understanding of market segmentation might help him improve his business prospects. Your report should include a discussion of appropriate segmentation criteria and provide an example of how they might be used in t

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Introduction

Question 2: Write a report advising Livelong how the understanding of market segmentation might help him improve his business prospects. Your report should include a discussion of appropriate segmentation criteria and provide an example of how they might be used in the health food market. Definition: "A marketing technique that targets a group of customers with specific characteristics.'" Explanation: To market products effectively to consumers, market segmentation, gives a company the understanding of groups of customers having the same interests and needs: what are their priorities when selecting the same product? What are they primarily looking for in a product? This profiling of consumer groups helps the company to decide which set of customers it has the best opportunity to sell to most cost effectively, easily and competitively, so as to gain the biggest market share by positioning the same product in different ways to different consumer groups. ...read more.

Middle

Certain criteria have to be met to help target the right market segments & sell to them successfully, such as: * Viability of the segment: is the segmented consumer group presenting a good enough opportunity to actually be a profitable venture? This means that the identified segment should be large enough so that the kind of product they are most interested in can be produced cost-effectively to be sold at a good profit. If the segment is too small, the production cost of their preferred product will be too high; the sale prices will be higher and even if the consumer group likes the product, because of the fact that it has become out of their economic reach, they might not be so eager to buy it. This may not allow the producer to compete with other sellers of the same product, resulting in possible loss of market share. ...read more.

Conclusion

Therefore women could be a better segment than men to promote cereal based health foods like Good4U bars as a popular and preferred way to keep fit. * Socio-economic segmentation: It can be can assume that since the company is situated in the southern part of the country, where the economic conditions are better than the rest of the country, and the spending power of consumers is higher, Rufedge could target the high income level segment. Also, we have to acknowledge that people with low income level are not generally going to spend money on a posh thing like cereal bars, especially because being in the category of 'health foods' they are perceived to be expensive and people with low income would rather cook their breakfast at home from scratch. Their social class segmentation should be C2 and above. * Psychographic Segmentation: Since psychographic segmentation is related to interests and lifestyle, people with busy lifestyles and health related interests should be targeted because busy people like working mothers and people who actively participate in sports should be considered as a segment for Rufedge's products. ...read more.

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