Title: Six reasons for Market segmentation - Why use Market segmentation?
Headings: Six reasons for Market segmentation
Six reasons for Market segmentation
About Hitesh Bhasin

Content: Some of the reasons are outlined below. Better matching of customer needs – Customer needs differ. Creating separate offers for each segment makes sense and provides customers with a better solution. Enhanced profits for business – Customers have different disposable income. They are, therefore, different in how sensitive they are to price. By segmenting markets, businesses can raise average prices and subsequently enhance profits. Better opportunities for growth – Market segmentation can build sales. For example, customers can be encouraged to “trade-up” after being introduced to a particular product with an introductory, lower-priced product
Retain more customers – Customer circumstances change, for example they grow older, form families, change jobs or get promoted, change their buying patterns. By marketing products that appeal to customers at different stages of their life (“life-cycle”), a business can retain customers who might otherwise switch to competing products and brands
Target marketing communications – Businesses need to deliver their marketing message to a relevant customer audience. If the target market is too broad, there is a strong risk that
(1) the key customers are missed and
(2) the cost of communicating to customers becomes too high / unprofitable.