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Week 4 market segmentation

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  • 1. Market Segmentation
    • This part of your analysis will help you determine who your website visitors are, their geographic location, how and why they will buy from you, what makes them unique, and what you have to do to keep them loyal.
    • The concepts of market segmentation have become known as niche marketing. Instead of trying to compete on a grand scale, businesses choose to compete in smaller areas. These are called niches. Within these niches, businesses must identify certain characteristics to differentiate customers from one another.
  • 2. Market Potential
    • Now you are ready to segment your market. You have to determine if the market has potential for you. You may want to review the market attractiveness. Or, you may want to determine if the market can afford your services, if there is growth potential, who the competitors are, and the cost of doing business in this marketplace.
  • 3. You can take the process one step further by identifying the customer characteristics of your market segment.
    • This can be done
    • Geographically
    • Demographically
    • Psychologically
    • What is purchased
    • Type of organisation
    • etc
  • 4. Geographically
    • It may or may not be necessary to look at the geographic area of where our target audience is coming from. This can be broken down into Continent, Country, State, City, Urban, Inner City, Regional.
    • We may also need to consider the distance that the target audience is from the websites owners location.
  • 5. Demographically
    • Demographics looks at the makeup of the target audience. We should consider the Age, Gender, Education, Occupation, the Disposable Income and any special characteristics.
    • Age: Is the target market, a child, a teenager, an adult or retiree?
    • Gender: Is the product aimed at Males or Females?
    • Education: Consider if the product would suit people with a Secondary, Tertiary or University education.
    • Occupation: Is the product to be used in a special occupation?
    • Disposable Income: Is the product/service priced to a higher salaried bracket of the market?
    • Special Characteristics: is the prospective customer  a member of a special religion, race or nationality?
    • All of these need to be considered to put together a quality website plan. Miss the consideration of any one of these areas could mean the failure of the website.
  • 6. Psychologically
    • Every buyer/visitor is different and their reasons for buying are different. They could be influenced psychologically by their lifestyle, status, preferences and usage patterns. They could have special fashion needs, or follow fashion trends.
    • Personal preferences could effect buying trends, the customers hobbies, sporting activities or special interests will have to be considered.
    • Religion, ethnic requirements, political trends all have to be considered for possible areas of marketing actions.
  • 7. Other Ways to Segment the Market
    • There are other categories or classifications that may be used to segment the market even further. The tighter you can define your target audience the effectively you can create a website which meets their needs.
  • 8. Some other primary market identifiers you may want to consider include:
    • Financial Volume or Size:
      • How much money can your participation in this marketplace generate? Are there enough prospective customers to make it financially viable for you to compete?
    • Socio-psychological Needs:
      • What is the emotional state of the marketplace and does your product or service relate positively to that emotional state?
  • 9. Purchaser/User/Site visitor:
    • Quite often, the site user may not be the purchaser user, as seen when a parent buys children’s clothing. You must know both the purchaser and the user.
  • 10. Loyalty:
    • Will your target audience be loyal to your product or service or website? Try to find this out before settling on a particular market segment to target. OR
    • Is loyalty even a factor OR
    • Is there any residual “loyalty” that you may want to leverage?
  • 11. Getting to Know Your target audience
    • It is essential to know who your potential target audience will be and what makes them tick, so to speak.
  • 12. Who is the websites target audience?
    • Is our target audience male or female, married or single, white or blue collar, educated or not?
    • What does our target audience need from us?
    • What does our target audience want from us, and how does this differ from what she/he needs from us?
    • Can we satisfy those needs and wants, and if not, what changes must we make to satisfy them?
    • What does our target audience expect from us in sales and service?
    • What must we do to meet and exceed those expectations?
    • Where will we find our target audience?
    • What must we do to keep our target audience loyal?
    • How do we get our target audience to refer new individuals to us?
    • What must we do to make sure that what we are selling is what our target audience is buying?
  • 13. These questions should help you get to know your target audience. You should perform a SWOT analysis on your target audience or interview several of them to find out who they are, why they do or would do business with you, and what you have to do to keep their business. Consider all this information when developing your website plan.