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A market was defined as a group of people having a similar need for a product or service, the resources to purchase the product or service, and the willingness and ability to buy it. When an organization offers a product or service to a wide range of consumers it is practising mass marketing. Market segmentation involves the division of a large market into smaller segments ( or targets) based on common need and/ or similar lifestyles. The marketer concentrates on segments of the population by marketing different products to segments with different characteristics. Other market segmentation alternatives are niche marketing, a situation where an organization targets a very small or narrow segment of the market; and direct segmentation, a situation where the organization targets customers on an individual basis. With marketing segmentation the goal is to reach customers effectively. Advancing technologies have enhanced the marketer's ability to do so. Marketers can target customers individually and send messages to where they live, a practice referred to as geo-targeting. Through smartphones and GPS technology a marketer can track an individual's whereabouts and send messages to them as they move around, a practice referred to as location-based targeting.


Segmenting a market involves three steps: identifying market segments; selecting the most attractive segments to pursue; and positioning the product to appeal to the target market. The marketer will use his or her knowledge of demographic trends in the population when identifying potential markets to pursue. The marketer will identify a profile of the target customer. The profile is based on demographic, psychographic, geographic, and behaviour response characteristics—whatever information is relevant to the situation.

Demographic characteristics include age, gender, income, education, occupation, marital status, household formation and ethnic background. Psychographic characteristics relate to the lifestyle of the target and consider the target's attitudes, interests and opinions. Geographic characteristics relate to where the target lives; urban, suburban, or rural locations. Behaviour response segmentation considers the target's occasion for using the product, the benefi ts they require in the product, the frequency in which they use it, and their degree of brand loyalty.

The marketer develops a target market profi le that considers relevant demographic, psychographic, geographic, and behavior response characteristics. The target market profile is a key element of a marketing plan, since all marketing strategies are based on how well a marketer understands the customer.


Positioning involves designing a product or service to meet the needs of a target market and then creating the appropriate marketing appeals so that the product stands out in the minds of consumers. The goal is to plant a desirable image of the product in the customer's mind. Marketers describe how a brand is positioned in a positioning strategy statement, another key e lement of a marketing plan. Many experts believe a sound positioning strategy is the foundation of a marketing plan. Its importance is demonstrated by the fact that all marketing mix strategies (product, price, distribution and marketing communications) must fit with the positioning strategy. Such integration is what creates the desirable image for the brand in the customer's mind.

Some common positioning strategies include head-on comparisons with competitors, brand leadership, product differentiation, technical innovation, and lifestyle approaches. As a product matures, such factors as competitive activity and changing consumer preferences will force the re-evaluation of positioning strategies.