MCom 2nd Year Global Segmentation To Trade Study Material Notes

MCom 2nd Year Global Segmentation To Trade Study Material Notes: In this post, we will learn about MCom 2nd Year Global Segmentation To Trade Study Material Notes. In MCom 2nd Year there is one of the most important questions comes from Global Segmentation. You will learn about MCom 2nd Year Global Segmentation To Trade Study Material Notes. 

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GLOBAL SEGMENTATION

A market segment refers to a group of countries that are alike in respect to their responsiveness to some aspect of marketing strategy. Marketing Segmentation may be defined as a technique of dividing different countries into groups. The concept of segmentation is based on the fact that a business can not serve the entire world with a single set of policies because there are disparities among can not serve the entire world with a single set of policies because there are disparities among countries-both economics and cultures.

An international marketer, therefore, should pick out one or more countries are target markets. A company may not find it feasible to do business immediately with the entire spectrum of countries forming a segment. In that case, the firm may design its marketing programs and strategies for those countries it does enter and draw upon its experience with those countries in dealing with new markets. (MCom 2nd Year Global Segmentation To Trade Study Material Notes)

Peter. D. Bennett, market segmentation is the process of subdividing a market into distinct subsets of customers that behave in the same way or have similar needs. Each subset may conceivably be chosen as a market target to be reached with a distinctive marketing strategy. The process begins with a basis of segmentation-a product-specific factor that reflects differences in customers’ requirements or responsiveness to marketing variables (possibilities are purchase behavior, usage, benefits sought, intentions, preference, or loyalty).

Today, global companies are likely to segment world markets according to one or more key criteria: geography, demographics, psychographics, behavioral characteristics, and benefits sought. It is also possible to cluster different natural markets in terms of their environments, (e.g., the presence or absence of government regulation in a particular industry to establish groupings. Another powerful tool for global segmentation is horizontal segmentation by user category.

The basis of market segmentations are:

1. Demographic Segmentation. Demographic segmentation is based on measurable characteristics of populations such as age, gender, income, education, and occupation. A number of demographic trends-aging population, fewer children, more women working outside the home, and higher incomes and living standards–suggest the emergence of global segments.

2. Geographic Segmentation. Geographic segmentation is dividing the world into geographic subsets. The advantage of geography is proximity. Markets in geographic segments are closer to each other and easier to visit on the same trip or to call on during the same time window. Geographic segmentation also has major limitations. The mere fact that markets are in the same world geographic region does not mean that are similar. (MCom 2nd Year Global Segmentation To Trade Study Material Notes)

3. Psychographic Segmentation. Psychographic segmentation involves grouping people in terms of their attitudes, values, and lifestyles. Data are obtained from questionnaires that require respondents to indicate the extent to which they agree or disagree with a series of statements. In the United States, psychographies are primarily associated with SKI International, a market research organization whose original VALS and updated VALS to analyses of U.S. consumers are widely known.

4. Benefit Segmentation. International benefit segmentation focuses on the numerator of the value equation–the B in V = B/P. This approach can achieve excellent results by virtue of marketers’ superior understanding of the problem a product solves or the benefit it offers, regardless of geography, (MCom 2nd Year Global Segmentation To Trade Study Material Notes)

5. Behaviour Segmentation. Behavior segmentation focuses on whether people buy and use a product, as well as how often and how much they use it Consumers can be categorized in terms of usage rates. For example heavy medium, light, and non-user. Consumers can also be segmented according to s user status; potential users, non-users, ex-uses, regulars, first-times, and users of competitors’ products. Although bottled water may be considered a luxury h product in some middle-income markets.

Nestle is marketing bottled water in Pakistan where there is a huge market of non-users, who, despite their low income, are willing to pay is a bottle of clean water because of the widespread presence of arsenic poisoning in well water and the pollution of surface water.

SEGMENTATION STRATEGIES

Global companies normally follow the following segmentation strategies:

1. National Market Segments. Where markets are segmented according to variables that largely ignore national boundaries, e.g., demographic, bring practices, preferences, etc. The strategy concentrates on identifying similarities in customer needs across countries rather than emphasizing country/cultural differences. (MCom 2nd Year Global Segmentation To Trade Study Material Notes)

2. Global Market Segments. Which involves serving the same market segments in multiple markets but on a national basis segmentation is on the basis of geography/nationality which emphasizes cultural differences rather than similarities between countries.

3. Mixed Market Segments. Which is largely a combination of the first, two national markets may be of sufficient size to warrant individual situations. Others may be clustered into similar market segments.

GLOBAL MARKET TARGETING

Targeting is the act of evaluating and comparing the identified groups and then selecting one or more of them as the prospect(s) with the highest potential. SC A marketing mix is then devised that will provide the organization with the ar best return on sales while simultaneously creating the maximum amount of value for consumers.

CRITERIA FOR TARGETING

The basic criteria for assessing opportunity in global target markets are:

1. Compatibility and Feasibility. If a global target market is judged to be large enough, and its strong competitors are either absent or not deemed to represent insure mountable obstacles, then the final consideration is whether a company can and should target that market. In many cases, reaching global market segments requires considerable resources such as expenditures for distribution and travel by company personnel. Another question is whether the pursuit of a particular segment is compatible with the company’s overall goals and established sources of competitive advantage. (MCom 2nd Year Global Segmentation To Trade Study Material Notes)

2. Potential Competition. A market or market segment characterized by strong competition may be a segment to avoid or one in which to utilize a different strategy. After a local brand may present competition to the entering multinational. The multinational might try more or different promotions or may acquire the local company or form an alliance with it.

3. Current Segment Size and Growth Potential. The marketer has to see and judge the size of the market segment by asking the question–Is the market segment currently large enough that it presents a company with the opportunity to make a profit? If it is not large enough or profitable enough today, does it have high growth potential, so that it is attractive in terms of the company’s long-term strategy? (MCom 2nd Year Global Segmentation To Trade Study Material Notes)

Indeed, one of the advantages of targeting a market segment globally, is that where the segment in a single country market might be too small, even a narrow segment can be served profitably with a standardized product if the segment exists in several countries.