Customer Relationships and Satisfaction - Essay Example

According to marketers, there is a difference in the target audience when it comes to specific products. They are dissimilar on the basis of demographics, attitudes, wants, locality and social relationships (Decker, 2000).

Customer segmentation and targeting permits the marketer to offer a target audience a product that is contained by the requirements of needs and wants. It is a requirement to come up with the needs and values of the customers targeted within every single segment, in order for companies to suitably promote their products, brands or services.

Demographic segmentation

Under demographic segmentation, the division of customers within segments is established on standards of demography like gender, size of the family, age and the life cycle, social class and occupation among other factors.

The reason as to why demographic segmentation is frequently applied in market segmentation it is because the variables are easy to identify and measure. Moreover, the variables of demography are connected with selling of various types of products and services and in conclusion they provide an explanation of the target customers so that buyers using the media and alternate buyers can target the market they desire (Decker, 2000).

During segmentation of markets, each and every variable has an advantageous knowledge and a number of which were cited above and are discussed below.

To begin with, a focus on age and life cycle segmentation. As a result of the significant change in age, the needs and wants of consumers keep on changing. Thus, a number of companies run through the effect age and life cycle segmentation and their determinant approach in marketing is age and life cycle. In addition, age and life segmentation are associated with behavioral features and patterns of buying.

Besides this, gender segmentation has been used to distinguish between the needs and wants that men and women have as a result of the fact that men and women have dissimilar approaches toward a product. Gender segmentation over a period of time, has used in connection with how people dress, kinds of hairstyle, makeups and publications. Furthermore, the fact that metro sexuality in the current times has developed to be a common gender factor, therefore, marketers need not only describe a products on the point of masculine or feminine (Decker, 2000).

In the market, income segmentation has divided the market in diverse income groups. They are applicable in the following markets: motors, outfit, makeups, and travel. Most companies inside the stated groups look for to the target with high income while others pursue to lower income targets so as to achieve loyalty of customers and reduce pressures of competition. Conversely, companies need to reflect the point that predicting the most reliable customer on a specific product does not depend on income since some customers spend differently their money through their preferences and priorities

Furthermore, every generation is affected by the period of time they nurtured up for example the cinemas, the songs, political affairs and other substantial happenings with features of the age. Marketers consequently market to a group by use of images and pictures that are applicable conferring to the generation (Farkas, 2011).

Last but not least, segmentation among the social class splits the customers basing on their likings in vehicles, outfits, home furnishing, holiday activities, reading routines and vendors. Though, granting the palates of social classes, many enterprises design foodstuffs for particular social classes.

In summary, the discussion above about demography and the variables, methodology to segmentation of the market takes an assumption that as individuals can be categorized into various groups they are expected to segment the equal standards and buying conducts (Farkas, 2011).

Geographic segmentation

Basing on geographical subdivisions of countries, capitals, and others areas, customers are divided under geographic segmentation. A firm may target a number of regions and must be conscious about factual information of variations in population as a result of geographical segmentation.

Since the purchasing behavior of customers is affected by some factors, segmenting through geography is important. Thus most companies modify their products through advertisements, product promotion and other ways in order to fit in certain geographical conditions.

The geographic segmentation is additionally valuable as soon as there are differences in site wherever a product is noticeable. The variances can be affected by social influences, customs, and political affairs and moreover the variances can be important in one segment, however in alternate segments the variances can be slight and a smaller amount of importance.

In addition, due to the rise in the globalization in the present day the geographic segmentation has been connected to other changes in socio-economic and demographic features (Farkas, 2011). The outcome of this segmentation is denoted as geodemographics. The combination between geographic segmentation and demographic segmentation result to geodemographics and thus associates the study conferring to the place where target customers live in contrast to the way the communal class describes consumers by their job and in this manner the firms have extra capability of forecasting the behaviors of consumers.

Psychographic segmentation

Variables of psychology stem up from double kinds of customer’s principal; personality and lifestyle profiles. Under profiles of psychology, it is frequently used as a complement to geographic and demographics which offer adequate sight of the customer behavior. Although the traditional geographic and demographic foundations such as gender, time of life, and salary, offer the marketer with convenience to customer segments, the psychological variable offer extra material about these and improve the thoughtfulness of the behavior of current and prospective markets targeted.

Psychographic segmentation consequently splits individuals according to their approaches, standards, and way of life, wellbeing and sentiments. Additionally certain marketers have used behavior variables to subdivide the markets (Goldenberg, 2008).

Behavioral segmentation

Behavioral segmentation is established on the customer’s defiance headed for, usage of or answer to a product. A lot of marketers have confidence in behavioral variables that are unsurpassed beginning points for raising market segments and therefore these variables will be defined in the subsequent.

To begin with, when customers are distributed into segments centered on different occasions, that is period of time. Individuals are therefore being assembled to conferring to time over which they received the awareness to buy, sort their buying or consume the purchased thing. An example may be in the course of holidays like Christmas. A business may select one type of strategy in marketing during Christmas and another during a different holiday time and therefore the ability to target more preferred customers.

Besides this, benefit segmentation is also a form that divides the customer to the dissimilar paybacks that might pursue from a product. Through looking for advantage that people need in various products, benefit segmentation considers that. Additionally, the benefit segmentation classifies marketplace segments through unpremeditated influences rather than expressive influences like demographics.

Status of the user

Through segmenting in relation to different kinds of users, a firm’s product can modify marketing of every division. A place where every different users that is, regular users of certain products request one type of marketing methodology, prospective users might wish a different type of marketing style and therefore it is essential to distribute the consumers into different segments and target them in diverse methods (Goldenberg, 2008)..

Rate of usage

Under rate of usage segmentation, customers are divided in relation to the extent they use the product. The division is under different kinds and firms aim at a single heavy user and not a number of light weight users. This is as a result of the opinion that users who are heavy establish a minor proportion of the market although accounts for a greater proportion of the entire purchase. Therefore a firm needs to become accustomed to strategies of marketing conferring to the customers. Nevertheless, it should be mentioned that it is of certain importance not to exclude the rest of the users for reasons that these users might deliver a positive view for forthcoming expansions (Gutek, 2000).

To conclude the rate of usage splits the customers in relations to place and period, an example is, a firm might trade a single product different parts of time and the other product a different time of the day and subsequently the rest of the year as is related to using segmentation by occasion.

Buyer awareness

This refers to the level of awareness and curiosity in a specified product. Certain individuals are not aware of the product, part of them are aware, considering different interests. The drive is to lead the customer along so that he or she may buy the product at last. Therefore a company needs to obtain strategies to marketing that will favor the features.

Loyalty status

Segmentation in the market can also be in relation to loyalty that customers have. An assumption is always made that customers are always loyal through purchasing a similar product. Such customers are denoted to as hard core loyals. Individuals that are loyal towards more than one product are denoted as split loyals, among other types of customer’s loyalty towards a product (Gutek, 2000).

The last variable under behavior segmentation is the attitude that a customer has in relation to a certain product. Individuals can be distributed into segments in terms of their attitude toward a product. Through bearing in mind the attitude of a customer over a product, a company will receive a great opinion over the market and its segments.

Thus, through merging alternate variables of behavior, it is likely that markets will receive a clear picture of the segments of the market and in that way; the marketer can improve on the strategies.

Targeting

After the segmentation of the market, the next level is targeting. This is done after the segments have been recognized and ready to be targeted. Thus a firm may consider a mixture of marketing strategies that include; mass marketing strategy, single segment strategy or a multi segment strategy (Gutek, 2000)..

Mass marketing strategy

Mass marketing strategy is also referred to as undifferentiated marketing. Under this strategy the firm does not reflect on the alterations amongst every segment and selects to target the market with a single product. Thus, the firm focuses on a comparable need for the customers relatively to the differences. Nevertheless, when applying the strategy, it is incapable of archiving all the customers’ expectations and therefore it is impossible to fulfill all the customers’ needs.

Single segment strategy

Also referred to as, the differentiated marketing strategy. This is where a firm targets a number of market segments which provides particularly made for every segment. Therefore a company might obtain more sales and a stable position in every segment of the market. Nevertheless, differentiated marketing additionally results to more running costs for the business as a result of planning for each segment. Thus, firms should expect more sales alongside higher costs.

Multi segment strategy

This is also referred to as the concentrated marketing, and involves focusing on the bigger portion of a single or a small number of segments. Through these strategy a firm market effectively as a result of stable position and wide information to customers in every segment. Despite the fact that concentrated marketing can result to high profits, it includes high risks since the firm only rely on a single or a small number of segments in the entire business.

Thus, the selection of which type of strategy a firm will rely on is dependent on a number of factors; the product, the competition and the market. Each factor should be well reflected upon before determining the segment to target.

CRM

Through customer relationship management (CRM), the technology connects diverse departments of a company together. This is achieved through ensuring that the customer interacts efficiently with the firm and making information available to the customer through the website. The strategy in in CRM is concerned with building and developing a valuable product, where the consumer relies on (Wübben, 2008).

The development of a long term relationship with consumers and key clients in based on strategy creation. The main objective is to deliver quality services that will influence the long term satisfaction of a customer which is a general precondition to full loyalty.