Marketing Essay Example | Topics and Well Written Essays - 2500 words - 2

Marketing - Essay Example Market segmentation was introduced in 1956 by Wendell Smith, and since then it has, more than any other marketing concept, been the subject of scholarly discussion and inquiry (Quinn, 2009). His main argument lay in the sense that goods will be able to realize their maximum potential utility if the differences among market segments were recognized and catered to, rather than if goods were produced indiscriminately for the mass market (Foedermayr & Diamantopoulos, 2008). The wisdom in segmentation is that it aids in creating a homogeneous group out of a heterogeneous market, for which a more effective marketing mix may be designed. This enhances the attractiveness of the firm and its products to the target segment, by allowing the company to more ably meet the customers’ perceived needs. Furthermore, the segmentation exercise undertaken by the company in the process of strategizing better enables the company to more specifically determine and understand customer needs, and the criteria by which such needs may be segmented. A closer match could therefore be created between the product design, the marketing approach, and the requirements of the customers (McDonald & Dunbar, 2007). Market segmentation is conceived of as a highly useful â€Å"sense-making† tool, often for the purpose of communicating to the targeted market in the most effective way (Quinn, 2009, p. 253). However, the degree to which it is useful as a tool for creating specific strategic plans is the subject of current debate. A salient criticism against reliance on segmentation as a concept emerged in the 1990s. At that time it became apparent to some scholars that consumer lifestyles continue to grow increasingly fragmented. As a result, market segmentation appears to become more and more ineffective as a valid method for defining the market of a firm (Quinn, 2009; Charles, 2002; Holt, 1997). The idea of â€Å"lifestyle† has been used to define market segments, but more and mor e the concept has become vague and ambiguous. In practice, it has become difficult to define in detail all customers served by a firm or industry, and increasingly the approach to segmentation is to identify the criteria most important to that business and divide the customers into groups according to those categories that are most manageable (Quinn, 2009, p. 255). The variations in lifestyles and the wide variety of differentiated products have created not a few general homogeneous markets; on the contrary, and for some industries in particular, customization of product and service designs have become the standard. For instance, in addressable and interactive communications are profiled against individualized customer analytics and propensity modelling; these assist in determining the likelihood that specific propositions shall be accepted (Bailey, Baines, Wilson & Clark, 2009). 2. What are the different segmentation processes for both B2C and B2B? To understand the different appro aches concerning B2C and B2B markets, it is necessary to define the terms. B2C is short for business-to-customer; that is, the business that supplies the product, whether good or service, is targeting the end user or individual consumer. On the other hand, B2B refers