Segmenting the Business Market

1
Segmenting the Business Market

• Chapter 5

2
High-Profit Companies

• What makes them successful?
• Three targets

3
Business Market Segmentation Benefits

• Market segmentation
• A group of present or potential customers with
  some common characteristic which is relevant in
  explaining (and predicting) their response to a
  suppliers marketing stimuli.
• Percentage breakdowns

4
Business Market Segmentation Benefits

• Five criteria for measuring desirability
• Measurability
• Accessibility
• Substantiality
• Compatibility
• Responsiveness

5
Business Market Segmentation Benefits

• Competitive Environment
• Competitive analysis
• Core competencies
• New competition
• Technical Environment
• Three types of technology
• Product technology
• Process technology
• Management technology
• Benefits of Segmentation

6
Bases for Segmenting

• B2C Segmentation
• Macrosegmentation
• Organizational characteristics
• Examples
• Dell
• Microsegmentation
• Characteristics of decision-making units
• Examples

7
Macrolevel Bases

• Segmentation Methods
• Characteristics of Organization
• Size
• Geography
• Usage rate
• Structure of purchasing function
• Product Service Application
• NAICS

8
Macrolevel Bases

• Segmentation Methods (contd)
• Value in use
• Definition
• Purchasing situation
• Example
• First-time
• Novice
• Sophisticates

9
Microlevel Bases

• Segmentation Methods
• Key criteria
• Whats important to customer
• Example
• Programmed
• Relationship buyers
• Transaction buyers
• Bargain hunters
• Value-based strategies
• Innovation
• Customer in fast-growing markets
• Customer in highly-competitive markets

10
Microlevel Bases

• Segmentation Methods (contd)
• Purchasing strategies
• Satisficers
• Optimizers
• Structure of the decision-making unit
• Importance of purchase
• Attitudes toward vendors
• Organizational innovativeness
• Personal characteristics
• Microsegmentation Illustration
• Philips

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Organizational Market Segmentation Model

• Macrosegmentation
• Microsegmentation
• Check on costs and benefits
• UPS
• Implementation
• Questions to ask