Marketing 101: Segmenting
Small businesses should learn to segment their current and future customers
Workshop
Small businesses should learn to segment their current and future customers
Segmentation is a businesses’ map of the market. It divides the market into sub-markets on basis of people with common needs. It helps to identify the most valuable customers for the business.
Step 1: Finding total size of the market
Total population
% of population as users
Consumption pattern, trends and breakup of the users or customers
Total consumption per year
Average cost and total market value
Step 2: List down the variables in the category
Online shoppers
In-store shoppers
Other behaviours of the customers
Step 3: Giving weightage to the categories
How meaningful it is to your business ( 1 to 10)
How actionable it is to your business (1 to 10)
Multiply both the weightage to get the final score
Step 4: Picking the market segment
Top 4 or 5 variables with the highest score
These are the most relevant for the business
Map out the segments and give them a name
Step 5: Ask strategic questions
Is your product a profitable idea?
Which segments should your product target?
What position should they take when targeting a segment?
Should that positioning be different for other segments?
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