Occasional Segmentation and Benefit Segmentation - Assignment Example

Institution : xxxxxxxxxxx Title : Marketing Tutor : xxxxxxxxxxx Course : xxxxxxxxxxx @2010 Task 1. a) Occasional segmentation and benefit segmentation Occasional segmentation and benefit segmentation are two concepts applied in market segmentation. Market segmentation is the process of diving markets into segments which have one or more characteristics. A single market segment is different from the others and has unique characteristics that are homogeneous within it. Occasional segmentation is therefore the process of dividing the market into segments based on occasions during which the buyers develop the idea of buying some products or using the purchased products. Some products are considered for use during certain occasions. This limits the markets of such products during the time of those occasions. For example, cereals have been used for breakfast and are therefore marketed as breakfast foods in many countries. They have therefore been widely used in the occasion of waking up (Tutor2u 2010). On the other hand, benefit segmentation is the process of dividing a market based on the different types of benefits that are being sought by the consumers from a particular product. This considers the attitude of customers towards a particular product. In benefit segmentation, the sellers must try to find out the benefits that consumers look for in certain products. Some products may have other benefits from the obvious ones. For example when buying soaps, consumers may consider other benefits such as medicinal, cleanings, economical and smell (Schiffman, 2007). b). Customer profile is the description of various aspects of a customer including his needs and wants. It defines what a customer is in terms of the products available in the market and his preferences. The customer profile of goods such as women dresses includes young working women mainly from the urban areas. In many cases, rural women do not frequently but clothes since most of them remain indoors or engage in informal jobs. Preferences for women dresses change with time. Women like following what is on fashion and also the weather conditions. During the cold season, women may shop for long dresses, made of heavy materials. But during the hot season, women prefer the light material dresses, which are short in length and having short sleeves. With the young women as the target market, analysis is required on the design that fits their preferences at that particular moment. The geographical location of the women also influences their preference since it has an impact on the climate. Women from the tropics may mostly require the light material dresses; the type of job done by women also determines the form of dresses they buy. Those in the formal employment may require official dresses while those in the informal sector may not consider official dresses very much. Task 2. The most important factor in segmenting a market is to find distinct characteristics that give a business its marketing limits. This is very important to businesses that have a specific target market. Market segmentation therefore requires consideration of the following variables: Geographical market segmentation: This is where a market is segmented based on various aspects of their region. These include the region itself, the climate, and the characteristics of the population in the region. In considering the region, one considers the continent, the country or the state of the target market. This is important because people in various countries or continents have different needs. The size of that region is also important for wider market coverage. Population density is also another important factor in geographical market segmentation. The climate also influences the market needs of people. People from a particular climatic region may have particular needs that are promoted by the climatic conditions (Kotabe, 2005). Geographical segmentation is particularly important for multinational companies that operate in the global world. Such companies have marketing programs in different countries which must be determined by geographical characteristics. An example of such multinational company is coca-cola company for manufacturing and bottling soda. This company operates across multiple continents and this means that various aspects of advertising, promotion and product design varies. For example the mode of advertising adopted in Africa may be different from the one in Asia. The products design for countries in the tropics may be different from those in other regions. Demographic segmentation: this is segmenting a business market based on factors such as the age, income, family status, occupation and gender. These are the most common variables in every business market. This is because most customers base their need son their income levels, family size, their gender and their age. As people’s age increase, their needs change. For example in marketing toys, it is important to consider the age that will have much interest on them. Gender is important when marketing goods such as clothes, cosmetics and services such as hairdressing. The levels of income also determine the purchasing patterns of people. Marketers offering luxury goods and services may target the high income young people. Others offering convenience services such as banking must also target the high income people. People may desire all types of goods but their purchasing power may be lower than their desires (Poulos, 2007). Psychographic segmentation: this is dividing the market based on the values, the lifestyle and the attitudes of the customers. Marketers must understand the psychology of their customers together with their needs so as to be able to decide whether they will accept particular products. For example a car dealer may have his market segment as the high income level customers. However, among those customers, the marketer needs to analyse the habits of the potential customers and the existing ones. This will help him to understand the factors that the target group considers when buying a car. Some may consider the prestige, some may consider the job to be done with the car while others may consider the distance coverage. The usage of the car may therefore help the marketer with a basis for his products (Perner, 2010). Behavioural segmentation: This is segmenting the market based on aspects such as the occasional of usage of the product, loyalty of the customers to a certain brand, and the benefits looked for. Behavioural segmentation involves benefit segmentation and benefit segmentation. In occasional segmentation, the marketers look at the times during which a particular product may be extensively used. Benefits include what they gain by buying a certain product. Some products may have multiple benefits such as for leisure, for satisfaction and for protection. Some customers may also be loyal to some brands of commodities and this may attract them to buy such products. This is behaviour of the consumers which may be hard to change. Marketers should therefore aim at providing the products that are in line with the behaviour of customers. For example, customers may be loyal to a certain brand of toothpaste, which they may also like due to its medicinal protection, and also for brushing their teeth in the morning. So the marketer should be aware that it is used in the mornings, and for multiple benefits (Poulos, 2007). Task 3. The steps in rational decision making give a stepwise approach to making decisions and ensuring maintenance of consistency in decision making. The first step in rational decision making involves identifying the problem that needs to be decided on. An example of this is business location. The problem is based on the issue at hand that needs to be addressed. In identifying the problem, one must consider the opportunities that are available in settling the issue. In deciding where to locate the business, it is important to consider the business locations available. The second step in rational decision making is to gather information concerning the available options. One must only gather the relevant information concerning the issue. In deciding on business location, one must gather information concerning the accessibility of the location to customers and the infrastructure of the available options. Information should also be based on the type of business being set up. The third step is to analyse the situation. This is having a deep analysis of the situation. In analyzing the situation, one must consider other available alternatives to the one available. The alternatives must also be analysed in details and compared with the one at hand. One must consider all factors that relate to the business for which location is being sought. Analysing the available situations prepares one to decide on the course to take since one will have all the information at hand. The fourth step is to develop options based on the information gathered and the analysis done. Where there are many options, elimination method can be used where one will eventually be left with those options that are close to the desired characteristics. However, it is good to be left with various options so that if one fails, others can be considered. The options must have different characteristics for a wider consideration. The fifth step is to evaluate the alternatives. Where there are alternatives, they should be evaluated for feasibility, acceptability and how they are desired by the consumers. In this case, one has to consider the desires of the customers and of the business owner. In locating a business, the most important factors are accessibility to the customers, which is determined by the infrastructure. When considering the alternatives, one has to see which of them may be meeting these factors more than the one in mind. The other step is to select the preferred option. After evaluating the opportunities, one needs to settle on one that meets almost or all the requirements. The value of those alternatives must be considered. This is because any option considered must add value to the business. One must consider the value that will be added to the business by locating it in a certain area as compared to other alternative areas. One must also consider the risks that the business will face when located in the available options. The final step is to act on the option chosen. This involves putting in place the resources needed to settle the business in the chosen area (Perner, 2010). Task 4. The family lifecycle is divided into eight stages which are characterised by various developmental roles and crises due to completion or failure to complete these roles. The first step is leaving home when one feels mature and in need of independence. This stage is associated with emotional feelings due to separation from the parents. During this stage, one may not be in need of many things since the only needs to be met are personal. Women at this stage focus more on clothing and cosmetics while men focus on things like vehicles and luxury goods. The second step is commitment to a relationship. At this stage, one has to establish an intimate relationship with a partner of the different sex. This means that there is further separation from the parents and in most cases a permanent one. During this stage, the needs of the two changes from the personal needs to family needs. Their needs are those geared most to family life. They need to build or buy a house and other needs geared towards their future lives. The third stage is learning how to live jointly. Their roles change to common ones and there is division of labour. Their lives become independent from their families and have to make their own decisions. Needs are in this case directed towards the expected children. Housing is also an important need in this stage. The fourth stage is parenting the first child. At this stage, another family member comes with more needs. Needs such as clothing for children, special food and child care services commence. The parenting roles have to be shared so that the child can get the best life. Education also becomes a need at this time since the child must be taken to school. The fifth stage is bringing up the adolescents. The needs of the adolescents are so many and this requires that the parents make anew focus on their career lives. Education needs increases, food also increases and entertainment services for adolescent children. Adolescents are in their rapid growth stage and they require enough food at this time. They must also keep changing their clothes since their body sizes keep changing. Parents must therefore work hard to be able to provide for them. The sixth stage is the departure of the children from home. At this stage, the adolescents may require freedom of being away from their parents. The parents may be left alone and this decreases their needs. They also lose their parenting roles. The only important service that they require from their parents is counselling and guidance. The needs of the parents now shift to their children. The seventh stage is retirement. During this stage, the earning decrease but at the same time the needs also decrease. Since children have already departed, the only needs that have to be met are food and a few clothing. The parents have a lot of free time and they may require leisure activities. Travelling needs may also be high at this stage. The final stage is the old age. Here the body abilities decrease and most services may have to be paid for. They may be unable to cook, wash and to farm. They therefore have to pay for such services (chiffman 2007). Task 5. a). Methods used by marketers to collect information of consumer behaviour For consumers to improve on their marketing strategies, they need to understand the behaviour of their customers. One of the methods used in collecting such data is by conducting surveys. Surveys are research tools that involve administering research questions to get response from the consumers. These are questions about some aspects of consumer behaviour. The questions may be open ended thus allowing consumers to give some information about themselves, while others may be close ended where the consumers choose among various multiple choices. Surveys can be conducted through personal meeting with the consumers, or through emails and letters. Companies may carry out surveys in some market segments where their line of production aims while other businesses may carry out general surveys covering all the consumers. Data obtained from the surveys may be used to determine the purchasing patterns and power of the consumers. This can also give information on the tastes. The other method of collecting consumer information involves conducting interviews. Interviews involve meeting the consumers directly and having discussions with them. Interviews are preferred over the surveys because they give more insight and one can read the mind of consumers. Researchers can ask the consumers of how they make purchasing decisions and the factors that influence them. Some companies do video recording of the consumers while in the markets, for example the grocery markets. This helps the marketers to get information on how the market environment influences the consumers. One may be able to see how the market arrangement may also affect the customers, the prices, and the language of the sellers (Blackwell, D'Souza, Taghian, Miniard, & Engel, 2006). b). Purpose of collecting consumer information according to Webb (2005), the first purpose of consumer information is that it helps the marketers to increase their sales after knowing the preferences of the consumers. Marketers may change their product line after knowing what the consumers like most. The second reason is to know what attracts the customers into certain shopping points. Sellers may realise that their form of arrangement of goods may be a source of attraction to the customers. The third reason is that the sellers may get feedback information from the consumers that they may use to improve on their products. For example those dealing with food items, they may get information concerning the tastes of the customers and this may help them to improve on their products. The fourth reason is that it helps in marketing. Marketers may know how factors such as advertising and promotions may influence the buying behaviour. They will therefore know what to focus in while designing the advertisements. The fifth reason is that it also helps the marketers to know the psychology of the consumers, and other factors such as their culture that may influence their purchasing habits. This will help the marketers to adopt into the cultures of the consumers. Bibliography Webb, K., 2005), Consumer Behaviour, McGraw-Hill , New York. Blackwell, R., D'Souza, Taghian, Miniard, & Engel, 2006, Consumer Behaviour: An Asia Pacific Approach, Thomson, Cengege, Austria. Poulos, M., 2007, Buyer Behaviour implications for marketing 2nd Ed, Pearson Education, Meulborne. Schiffman, L., et al, 2007, Consumer Behaviour, 4e, Pearson Education, Meulborne. Kotabe, et al; 2005, International Marketing - An Asia Pacific Focus, Wiley, London. Perner, L., 2010, Consumer Behaviour: The Psychology of Marketing. Retrived on 21st October, 2010 from Tutor2u, 2010, Market S egmentaion retrieved on 21st October, 2010 from http://www.tutor2u.net/marketing/default.html Read More