The Concept of Market Segmentation
The assistant to the Manager of the marketing department of Dyson have
been asked to write a report that describes the concept of market
segmentation with suggestion on how Dyson could segment its markets,
an outline of the new product development process along with
suggestions of how Dyson should apply these stages and concluding with
an explanation of how Dyson can perform their marketing control.
This report is fully based on secondary data, primarily from the
course literature but also other internet based sources.
This report will systematically explain the concept of market
segmentation together with examples of how Dyson can segment its
markets. This will be followed by a stage outline of the new product
development process accompanied by my suggestions on how Dyson should
apply these stages. Finally, a descriptive scenario of how Dyson might
control and monitor its performance will follow.
Levels of market segmentation
A company using this strategy does not segment the market at all; it
offers the same product and uses the same promotion for all consumers.
This method has often been used by companies with mass production of
convenience products or by companies with few or none competitors.
Mass marketing is associated with low promotion costs often reflected
by a low price.
This involves the process of dividing the market into categories with
different characteristics and needs. By doing this a company can adapt
all their offerings towards the needs of one or more different
segments, in order to better fulfil these needs. The advantages are
that a company can target the segments of which they best can match
the consumer needs or those segments with the least number of
A niche is basically a sub-segment which often has unique
characteristics and special needs. Niches often search for special
features, for which they are prepared to pay for. This puts companies
using niche marketing under pressure since they have to achieve great
understanding of its customers needs. Since the niches are rather
small, the competition will also be smaller and this can create
opportunities for small companies to serve customer needs that others
have not recognised.
Micromarketing is concerned with specially design their marketing mix
to meet the needs and tastes of particular locations or individuals.
Local marketing aims to meet the needs and wants of a specific
geographical location. This method can be used by both small local
enterprises as well as large corporations. However, for the large
corporations this is often associated with...