Market segmentation is the grouping of consumers with similar needs through gathering crucial data relating to potential consumers including demographic, socioeconomic, psychographic, geographic, behavioural and benefits, to determine the best suitable market that will be beneficial for the organization. Segmenting market is important to an organization as it helps to decipher consumer’s needs.
This group is chosen by utilizing three key components of market segmentation in order to accurately and efficiently identify their common needs. These components include gathering information on, demographic, which is specifically related to age, gender, ethnic background, socioeconomic and geographic, exploring location in terms of country and city, (Shark, & Lyberger, 2015).
1. Components of market selection decisions and how market selection decisions are incorporated into the larger strategic marketing process.
The key components of the market selection decision are segmentation, targeting, and positioning (STP).
(a) Segmenting, as the first of the model, refers to the grouping of consumers with similar needs, by gathering data relating to demographic, socioeconomic, psychographic, geographic, behavioural and benefits.
(b) Targeting, is related to choosing the appropriate divisions or sections that will be beneficial to the organization’s market objectives.This process will help the organization to choose the best market that is sizable, reachable and measurable.
(c) Positioning, as a crucial component of the of the market selection decision objective, is to psychologically penetrates the minds of the consumers within the target market. This process is through psychological stimulation and will ensure that the target market has a favorable perception and reaction to the product being marketed by the organization.
2. Details of some examples of how sports marketers segment the various sports markets.
(a) Demographic, is one of most widely used technique explored in segmentation within the sport industry to capture personal information about people’s attitudes and sport behaviour. The depth of analysis can be done including identifying and measuring of information utilizing secondary data from government databases to determine different age groups of sport consumers. For example, to understand who attends as a posed to watching sports on television or via the internet.
(b) Socioeconomic, determines consumers grouped within the target market, whether they have the same status or not based on society’s standard, in other words, social class based on accomplishments including level of education and income.
(c) Psychographic, is more comprehensive segmenting than others, as it explores why consumers buy, with the aim of having a better insight specifically to their lifestyle, activities, interest and opinion. The grouping of consumers is with relation to their lifestyle and preference in sport, to better understanding why they buy the product they buy.
(d) Geographic considered a simple segmentation, but is very potent for sport markers as it is critical for making broad distinctions within market segments, for example, world region because of the escalating interest in international markets within the sport industry.
3. The Target Market
The target market is the consumer group based on strategic evaluation that is chosen for penetration of a product to obtain an organization goals or objective. The target market should meet certain or specific criteria including the following.
(a) Size should be a differentiated market which is very important, and marketers should choose carefully the adequate potential consumers for its product.
(b) Reachable, an organization should be able to communicate with consumers efficiently through mass media including television, radio, and print, such as newspaper and magazine.
(c) Measurable is the ability to evaluate the size, accessibility and the purchasing power of the potential consumers exploring variables such as identifiable, accessible, sustainable among others.
Reference
HP Sports Corner 