MARKET SEGMENTATION

Marketers appreciate that not all clientele buy the same manufactured goods to address the same need. And, client satisfaction level may vary depending on particular attributes  within groups of clientele such as age, sex, race, religion, geographical educational background,  sexual preference, location,  profession, and income, just to name a few. Therefore, marketers smash customer populations down into smaller market using these shared individual attributes and other information; this is called market segmentation. Clientele within these smaller populations share needs that are more closely allied and unusually identifiable. This makes it easier to develop new products and to design detailed marketing efforts. For example, a cigar manufacturer may choose to run an advertisement for its product in Golf magazine, because investigate shows that those who golf and read golf magazine often also smolder cigars, and can afford to smoke luxurious cigars. Alternatively, cigar manufacturer would not scamper an ad in Prevention magazine, or Health and Fitness, because data suggests people who read these magazines typically do not smoke.

A more specific and individualized practice of market segmentation is database marketing.  Database marketing uses populace figures to identify and target persons within a group to determine who is most likely to buy a product. For example, suppose sear kept a database of all its clientele who use a Discover card to buy baby clothes sized zero to six months. Sears could imagine that these consumers are either expectant a child or know someone who is. Sears could then use the database to send these clientele particular baby catalogs or coupon to stimulate them to buy more baby foodstuffs at Sears.

Use of, and especially the advertising of databases contain an individual's purchase times past has sparked debate among privacy advocates. Any company that sells customer's information must also give customers the option to "opt-out" of having their information sold. A law approved in 2001 granted financial services corporations the legal right to sell individual's transactional information if the individual did not "opt-out." Thus the accountability is typically placed on the person to "opt-out," rather than on a company to ask him or her to "opt-in." Nonetheless, great care should be taken before advertising information. If you are bearing in mind selling your client database, you should notify clientele first, to avoid the risk of negatively touching customer pleasure.

Possible privacy issues aside, market segmentation is an important tool for advertising professionals in determining who their clientele are and what those clientele want.

With this basic understanding of who their clientele are and how those clientele make decisions, marketing professionals then expand products and services and attract clientele to buy them. The marketing model that describes this procedure is known as the five Ps.