Market Segmentation, Orientation, and Positioning | Free Essay Example

Market Segmentation, Orientation, and Positioning

Words: 1690
Topic: Business & Economics

Market segmentation

Market segmentation is critical for the success of the organization. As such, firms have to be tactical while deciding on the market segment to be targeted by a particular product or service. The reason is that consumer demands are varied depending on several factors including age and income. In other words, the organization has to meet the demands of various target groups effectively. Essentially, organizations must have the knowledge of their target markets, segment the market depending on various factors and align the products to the needs of various market subdivisions.

Market segmentations are often conducted by the organization to improve productivity as well as the characteristics of products and services. In most cases, organizations segment their markets to understand the needs of the target market. Knowledge is critical in the production of goods and services. In other words, organizations use the knowledge of the target market segment to align their products and services according to the needs of the clients. As such, the organization’s productivity and competitiveness increases.

In the context of the coffee shop, market segmentation according to various factors can lead to several target customer profiles. Segmentation according to demographics can lead to customers that are grouped in terms of gender, income level, age, occupation, and marital status. The coffee shop may target more males than females depending on consumption levels. Also, the coffee shop may target high and low-income earners or may target middle-income groups.

Moreover, the business’s target group may be the younger generation or adults particularly the married. Essentially, the target market group has distinct characteristics and needs that the organization aligns with its products. Depending on how the market is segmented, the coffee shop may end up with high-income customers, married women as well as travelers primarily drinking coffee.

The usefulness of segmentation in marketing

Classifying the market into various categories of consumers has several benefits not only to the firm but also to the marketers. One f the greatest benefit of client categorization is the increased knowledge of the customers within the group. In other words, market segmentation leads to improved knowledge of the customers. To the organization, market segmentation is critical in the understanding of the needs of the clients. In most cases, classifying clients in terms of various specific criteria is significant in identifying other applications of products and services that were not known in prior. Such knowledge is critical for organizations to target larger audiences within the demographic categorization leading to increased market share in the same sub-market base.

There are several approaches to market segmentation, particularly in fast-moving products and services. In particular, the fast-food market applies several segmentation procedures that increase their competitiveness and enhanced market share. Often, firms within the first food market apply a need-based segmentation approach where the business group customers according to their needs, specifications, and likings. Moreover, the firms within the fast-food market apply a marketing mix segmentation strategy where the products, price, promotion, and place elements are combined to position the products brands and penetrate the market. For instance, MacDonald Corporation has applied the marketing mix segmentation strategy to penetrate and position its brands into the market.

Market orientation

Market orientation and its importance in marketing

Market orientation is the process where the firm aligns its products and services according to the needs of the market. In other words, market orientation is the process where the firm’s products, services, operations as well as activities are organized around the market needs. In other words, the market-oriented firm has its primary focus on the changing needs of the market as well as its competitiveness in the marketplace. Such firms will often focus on activities as well as capabilities that increase their competitive advantage (Jobber, 2012).

For instance, Boundless Inc., a firm manufacturing textbook has applied various market-oriented processes to remain competitive and capture a sizeable market share. The firm has applied its technological capabilities to come up with the client’s database specifying their needs. Also, the firm has applied technological competencies to conduct market research. Similarly, Ford Company has changed its focus from product-oriented to market-oriented through the application of various strategies that put more emphasis on the needs of the customers.

Ford Company has put in place strategies that monitor the actions of the competitors, consumer preferences as well as needs. Moreover, the firm has aligned its resources towards attaining the desired goal. In both cases, the firms have been involved in analyzing the effects of exogenous factors on the customers’ preferences.

Key elements that a firm should consider when seeking to maintain a strong marketing orientation

The most important elements in marketing orientation include customer orientation, competition orientation, and inter-functional coordination. In customer orientation, the firm should focus its resources on attaining superior client value. Customer orientation enables the firm to attain long-term profitability. Therefore, the organization must recognize the fact that clients are the source of its long-term profitability. In this element, the main aim of the firm is to correspond to both the current and future needs of the customers.

In terms of competitor orientation, the firm needs to focus on the activities that will enable it to outperform its competitors. In most cases, market-oriented firms outperform their competitors through the delivery of better quality, products, and prices. Moreover, such firms have a greater knowledge of the client’s needs and adaptable to changes occurring in the market. Inter-functional coordination means orienting the firm’s resources and capabilities towards attaining the desired goals.

The market mix

Key characteristics of an effective marketing mix

Creating the right marketing mix is critical for the success of the organization. The main characteristics of the marketing mix are the tools organizations utilize to differentiate their products and services. Product, price, promotion, and place remain key attributes the marketing mix firms use to differentiate their products or services from the competitors.

Besides key characteristics that ensure increased service quality, competitive prices, right promotional strategies as well as distribution channels, the people, process and physical evidence will add more value to the services the coffee shop offers, which in turn increases its competitive advantage. People, process and physical evidence are additional characteristics that the business should consider to increase its competitiveness in the market. In other words, the 7Ps approach in the marketing mix will ensure the business increases the value of the offered services, which enhances its competitive advantage (Jobber, 2012).

Whether the extended marketing mix creates additional value for service organizations

As indicated, the product, place, promotion, and price forms the basic core elements of the marketing mix. As such, organizations often apply the four tools to create a marketing mix strategy that ensures the increased value of their products, which in turn increases their competitiveness in the market. However, with additional characteristics including the people, process and physical evidence, there are increased possibilities that the service firms will increase the value of services they provide to the clients. In other words, the 7Ps approach has increased possibilities of enhancing value to the services or products offered to customers. The place, process, and physical evidence look into the internal processes that help in the attainment of the place, price promotion, and product strategies.

Brand positioning

The concept of brand positioning and its purpose

Brand position is the perception of consumers towards a particular product. Consumers normally perceive particular products or services about competing brands within the market. Therefore, brand positioning is what the firm has created in the mind of consumers regarding a particular product. The main purpose of brand positioning is to increase awareness of the product and services as well as the existence of the organization. In other words, successful brands have increased awareness, relevant and differentiation from similar competing brands.

Intangibles brands attribute often create close relationships with the end-users. The tangible attributes are what normally create product differentiation since they generate a perception in the mind of the consumer as delivering certain expectations (Jobber, 2012). Unlike intangible brand attributes that cannot be grasped by the consumers, tangible brand attributes are seen, understood and considered important by the customers. Brand attributes are often explained through the application of a brand positioning map. Brand positioning map is used to evaluate the strengths and weaknesses of the product, indicates the product differentiation in the consumer’s mind as well as identifying the ideal points in the product life cycle.

Key issues in brand positioning

As indicated, the brand positioning is the process of placing a particular product or service into the mind of a consumer against competing for merchandise depending on the attributes as well as derived benefits. As such, the key issues in positioning the brand include attributes and benefits derived from the brand, quality and price, use or user as well as competition. In other words, the brands are positioned according to the characteristics that are attached to the service or product, the benefits consumers derive from the product or service, the image of the firm, the type of consumers using the products, comparison with other competing products as well as the whole product range.

Ansoff Matrix

Main considerations for a firm when developing a competitive analysis of their market

While developing competitive analysis, factors such as internal and external environments, the firm’s capabilities and risks as well as the strategies adopted by the business are often taken into consideration. Ansoff matrix identifies areas that the firm should consider while developing its competitive analysis in the market. According to the Ansoff matrix, a firm can apply various strategies including market penetration, market development, product development, and diversification to remain competitive. Using the matrix, a firm can assess the strategies to find out the best growth strategy options that will enable increased competitive advantage.

With the help of the Ansoff matrix, the UK clothing retailer can apply diversification strategy to remain competitive in the UK market. Diversification is a strategic growth option where the firm sells new products to diverse clients. Even though the growth strategy has increased risks, it remains the most suitable for firms operating under uncertain markets. The strategy is also the most potential for future growth and development.


Jobber, D 2012, Principles and practice of marketing, McGraw-Hill Education, New York, NY.