Requirements for Effective Segmentation/ What are the criteria used for effective market segmentation
Requirements for Effective Segmentation: Clearly, there are many for segment a market, but not all segmentations are effective. For example, buyers of table salt could be divided into blond and brunette customers. But hair color obviously does not affect the purchase of salt. To be useful market segment must be;
1. Measurable: The size, purchasing power and profiles of the segments can be measured. Certain segmentation variables are difficult to measure. For example, there are 32.5 million left-handed people in United States—almost equaling the entire population of Canada. Yet few products are targeted toward this left-handed segment.
2. Accessible: The market segment can be effectively reached and served. Suppose a fragrance company finds that heavy users of its brand are single men and women who stay out late and socialize a lot.
3. Differentiable: The segments are conceptually distinguishable and respond differently to different marketing mix elements and programs. If married and unmarried women respond similarly to a sale on perfume, they do not constitute separate segments.
4. Actionable: Effective programs can be designed for attracting and serving the segments. For example, although one small airline identified seven market segments, its staff was too small to develop separate marketing programs for each segment.