Wednesday, March 20, 2013

In response to Kaley DeBoer

However, what I question is whether or not one of the market segmentations is more beneficial is establishing a target market or does it depend on the product? Or do all of the above segmentations need to be considered at once when a market is determined?

I believe that all of the segmentations (geographic, demographic, psychographic, benefit, and usuage-range)  play a crucial role in determining a target market.  If marketers were to just focus on one segmentation because they felt it was more important than another, they could miss out on a key factor that is important in establishing a target market, and they could possibly lose out on customers.  For instance, if a company were to focus solely on geographic segmentation (segmenting the market by region or country, market size, market density, or climate) they might miss out on a key factor about the demographics in that area that are key to creating a target market like age, gender, income, ethnic background, family life cycle, etc.  An example would be if a target market was created for a high cost product in an area because it had an appropriate climate, but the income of the people of that area was very low, so the people in that area really would not be able to afford that product.  Therefore, it would be more valuable to consider all the factors when determining a target market.  I also believe that the product also plays a key role in who the target market is.

Are there any examples you can think of when a company focuses too much on one segmentation and eliminated a key segmentation which ended poorly for the company? 

One-to-One Marketing

One-to-one marketing is defined as "an individualized marketing method that utilizes customer information to build long-term, personalized, and profitable relationships with each customer" by our textbook.  The goal of one-to-one marketing is to reduce costs and increase revenue.  It is a huge commitment. but can be an advantage to those companies who practice it.

Although most businesses use a mass-marketing approach, it is more efficient for some businesses to use one-to-one marketing to increase share of customer. The difference between mass marketing and one-to-one marketing is that mass marketing increases your odds of getting customers with a less specific focus on a specific people where as one-to-one marketing focuses on specific communication opportunities with each individual customer.

There are four trends that lead to continuing growth of one-to-one marketing.  Those four trends are personalization, time savings, loyalty, and technology.  Personalization focuses on each consumers specific wants and needs.  Time savings involves consumers saving time because they now longer need to shop around and making purchasing decisions.  When loyalty is earned consumers with continually buy from the same company.  And finally, new technology offers one-to-one marketers a more cost effective way to reach out to their consumers.

Can you think of any companies who practice the one-to-one marketing approach instead of the mass-marketing approach?  Has it been beneficial to that company?  Why or why not?