Global Market Segmentation - Essay Example

Global Marketing Q1. Global Market Segmentation and Contribution of Market Research Global market segmentation is a procedure to identify specific segments across countries which consists potential consumers with similar attributes and similar buying powers. The goal of global market segmentation procedure is to segregate the global market of any product or services into various groups of consumers that have displayed differences in responses towards the marketing mix strategies of the organization. The proper execution of a global market segmentation method needs to consider six major processes such as identification of the purpose, selection of segmentation criteria, collection of relevant information, profiling of geographical location of the consumers as per the segmentation criteria, evaluation of the appropriateness or the attractiveness of the segmentation and updating and reassigning the segment membership. Identification of the purpose of global market segmentation involves the assessment of different segmentation strategies. These segmentation strategies assist global organizations to analyze the major objectives of market segmentation. These objectives consists the identification of customer needs to offer more suitable product for them, improvement of customer profitability by analyzing pricing process, identification of new target consumer groups, improvisation of customer retention and identification of growth opportunities to gather desired market share. The proper analysis of the marketing strategy will enable organization to adequately assess the market segmentation requirement. After identifying the major purposes, it is essential to analyse the suitable segmentation criteria. There are a number of based or methods which can be utilized to segment different global marketplace. The segmentation bases can be divided according to traditional process as well as the requirement of emerging market. The traditional segmentation bases include demographic, geographic, cultural, environmental, psychographic and behavioural criteria. On the other hand, the emerging segmentation bases focuses on response elasticises and product diffusion pattern. The choice of the bases of segmentation is one of the most important factors for global market segmentation. Global organisation need to focus on the selection of the right base for their market segmentation procedure in terms of their products/ services and customers profile. The segmentation bases for global market differs due to the differences in consumers responses and product features. The selection of wrong bases of the segmentation can misdirect the marketing strategies of the organisation. As per instance, in terms of market segmentation of the Lexus brand of Toyota the marketers need to segment the market as per household income and lifestyle while Malboro needs to segment the similar market as per population to introduce their new cigarette brand. Alternatively, while selecting the emerging segmentation bases for global market segmentation organisations may choose to analyse the global market in terms of product diffusion patterns. This pattern can allow organisations to analyse the actual purchasing pattern of different market segment. Another key task of global market segmentation is the accumulation of relevant information of the global marketplace as per the selected market segmentation bases. A number of segmentation variables under each suitable segmentation base need to be selected to gather proper information of the market status and consumer buying pattern of the global market. The important variables for demographic bases are age, gender, education, income and occupation. Similarly, for geographical bases the variables for relevant market information are nations, city size, population density, climate etc. Another major step of global market segmentation is the profiling of the consumers and geographical locations as per the segmentation criteria and collection of relevant data. The profiling of segmentation as per the collected relevant data assists marketers to characterize the large and identifiable groups of any market. The analysis of each segment and their profiling allow the marketers to assess the needs and demands of different market segmentation. Therefore, it allows the marketers to modify their marketing mix strategies accordingly to ensure proper establishment in the new global marketplace. After the segmentation of the market, collection of relevant data and profiling of market segments the marketers need to analyze the attractiveness of each market segments. The attractiveness of market segmentation can be determined by the analysis of the expected profit contribution of each market segment. The demand potential, responsiveness and accessibility of any market segment needs to be determined to assess their attractiveness. Therefore, the final major task of global market segmentation is to update or reassign segment membership by selecting the most appropriate market segment as per the market demand, accessibility and responsiveness of the market. The incorporation of market research in the global market segmentation process allows the marketers to maintain their focus as well as to deliver the required market insight. The process of market research involves the accumulation of information from different audiences via different tools such as focus group discussion, one-to-one interview and broad distributed surveys through e-mail, online polling, mail, phone etc. The market research processes can be divided into qualitative and quantitative procedures. The qualitative process generally collects in-depth information regarding the market pattern, trends and consumer decision making process. On the other hand, quantitative research provides more statistical and measurable information regarding the target market audiences and their purchasing pattern. The qualitative research procedure such as focus group discussion and in-depth interview assists organisations to analyse their segmented market as per their assessment and understanding regarding different product and service category. The utilization of projective technique in the qualitative market research procedure allow the marketers to uncover the insight regarding how the business audience and customers see, feel and predict about their product category and competitor brands. The projective techniques allow in engaging the respondents in a creative and free flowing description regarding their needs and the procedure to fulfil them. The qualitative research in the global market segmentation procedure assists the marketers to refine their market hypothesis as well as their learning about consumers. The motive of qualitative researches is to develop the preliminary dimensions of segmentation while the quantitative research procedures are used to draw conclusion regarding the importance of segmentation and their patterns and size. The quantitative research process allows marketers to focus on specific targeted audience segment to select a relevant target population sample as per the statistical results. Quantitative market research generally consists of online or telephonic surveys which allow organisations in terms of identification and profiling of large market segments. The collection of data and researches regarding market demand, product pattern, consumption pattern and buying behaviour allow the marketers to select the portions of larger market segment which demonstrate the proper desire and requirement of the organisation specific product and services. Therefore, these market research procedures allow the marketers to properly execute the global market segmentation procedure. It also enables the businesses to select and target the accurate market segment. Read More