Market segmentation represents the grouping of products with analogous qualities, in order to market these goods to segments of the population with similar tastes and purchasing power to better serve them with the appropriate advertising to further their satisfaction and increase sales. Companies utilize market segmentation information to better know their customers, to please them, and to be cognizant of the competition, to differentiate products from others at a competitive cost while seeking to offer better quality or value than the other producers. Differences in preferences, backgrounds, and purchasing power are a few of the elements that must be considered to better target the customer as well as their wants or needs.
Global marketing approach to segmentation differs from the domestic marketing approach due to additional considerations that must be made such as cultural values, currencies to be used and the exchange rates, tariffs and taxes in country as well as differences in cost of distribution, and political risk that must be estimated. Culture, Infrastructure, language, population, gender, age, wealth, education, geography are some of factors to be reckoned and considered. A main advantage of regional marketing is the homogeneity it may present and the characteristics shared by the population such as religion, sports and the like. The contrary can be said of what is required in the global marketing strategy, it has more elements to consider being more complex, yet it furthers the goals of expansion to the firms and their growth.
Kotabe, M., & Helsen, K. (2017). Global Marketing Management, seventh edition. Hoboken, NJ: John Wiley & Sons, Inc.
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