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Market Segmentation by Coca Cola - Case Study Example

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Market Segmentation by Coca Cola

Factors influencing consumer choice such as psychological, socio- cultural, economic government, lifestyles, perception, motivation, attitudes, consumer behavior toward a cold drink, family preference reference group, disposable income, discretionary income and other relevant factors have to be taken into account for segmenting the market and penetrating into different niche markets.
For last 5-6 years many banks and other financial companies targeted low-income groups with bad credits for sub-prime mortgages. These debtors were risky on the standard of credit rating below 6 and were expected to default one day or other. The real motive of the banks to extend credits to such borrowers were to earn quick profits in the background of flush of liquidity with then after the stock market bust in 2001 and the craze of many people to have his own house at any cost. This two supply and demand poles met each other. Financial companies became aggressive in targeting this segment for loans so much so that liquidity with them started falling, thereby creating pressure on lending rate and the resultant credit control by banks. There were numerous defaults in repayments causing credit crisis. In recent years housing prices in USA, were so steeply high that there was speculation of house bubbles.
In research paper published in the Journal of Housing research v...
This two supply and demand poles met each other. Financial companies became aggressive in targeting this segment for loans so much so that liquidity with them started falling, thereby creating pressure on lending rate and the resultant credit control by banks. There were numerous defaults in repayments causing credit crisis. In recent years housing prices in USA, were so steeply high that there was speculation of house bubbles.
In research paper published in the Journal of Housing research volume 6, Issue to by Robert Quercia, George W. Mccarthy & Michel A Stegman similar opinion has been expressed on Mortgage default among rural, low income borrowers. "When mortgage risks are not well understood households are forced to pay mortgages insurance premiums or mortgage interest rates that are higher than necessary to compensate for the higher risk involved.that lenders perceive them to represent"

Data from 2000-01 on foreclosed homes at Utah has used by Amber Gallagher Utah State university points out the fact of defaulting of payments and the following fore closer of the houses of the first time home buyers against loans. They were also subjected to specific segment targets for marketing loans but they were not fit for the mortgage. Payment to income ratio and loan to value ratio were at low level.

No ethics support such target marketing on lower income groups who are either ignorant about the risk or poor enough to afford on their own but have craze to have a house, which is the primary need for everyone. Financial companies with their own motives to earn quick profit target these people and for this they impose unsolicited terms in the garb to squeeze them. When the borrowers fail to repay the loan or interest in time their houses ...Show more

Summary

A cold drink market is very big and one single strategy cannot satisfy the entire market. Coca Cola must choose market segments with greater potentials in terms of penetration and profitability. The company has already targeted its products on different age groups and different consumers choice…
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