Classwork Exercise and Series ( Commerce- SS2): Market Segmentation And Marketing Mix

 Market Segmentation and Marketing Mix

Definition Of Market Segmentation

It is the process of dividing an entire market up into different customers segment or the division of customers into distinct groups where firms will identify those parts or section of the market that they can serve better.

Market segmentation helps firms or organization to reach target customers with the most appropriate marketing strategy. It makes the seller to make appropriate set of product mix, quality, price, advertisement etc.

Two Types of Segmentation Strategy

1. Multi-segment strategy: This is the situation where an organization focus on more than one market and directs its effort to two or more segment and thereby developing a mix for the segment chosen.
2. Concentration segmentation: This is a situation where a firm or an organization direct or focus all her marketing mix on only one segment of the market.

Definition of Marketing Mix

marketing mix refers to the set of actions that a company uses to promote its brand or products in the market.

marketing mix is the combination of some controllable element to satisfy the needs of the consumer and also to increase sales.

Four Ps of Marketing Mix

Marketing mix is denoted as “the four Ps. This four Ps was popularized by Neil Bordon and Mc Carthy

Element of marketing mix (four Ps) they are as follows: Product, price, place, promotion

Product Mix: This is the goods offered for sale or services rendered to customers. Products can fall into two categories namely-

Consumer Product : These are product purchased to satisfy personal or household needs e.g garri,cloths,etc

 Industrial products : This is the type of product bought by a firm or organization  for the production of other goods.

Product  mix is therefore concerned with creating or producing the right goods or services to the right market.

Price Mix : Price is the monetary value or worth that is placed on goods or  service. price mix is therefore the placing of monetary value on a product that will suit the consumer and yet will bring revenue to the producer or the seller. Some pricing policies are :

1. market skimming: this is a situation where the skimmer i.e the producer increases the price of goods to attract the rich and make quick profit and can later reduce the price as competition increases.
2. Market penetration :this pricing policy is good for new products.its a situation where the price of goods is relatively low so as to dominate the market.
3. Pricing with the market leader: this is the strategy whereby the new firms charges price along with the other firm in the market.
4. Pricing above the market : this policy is usually used for goods that are sold to rich people, in this policy a firm will charge prices above the other competing firms.other pricing policies are
5. Variable pricing
6. Bid pricing
7. Target return pricing
8. Product line pricing.

Place Mix : This is concerned with the distribution of goods and services to places where they are needed, distribution of goods and services should be package in such a way that it will create demand for the product.

Channel of distribution: It is the combination of institution through through which the seller markets its product to the buyers.

Producer—————————————————>consumer

Producer——->wholesaler——>retailer———>consumer

Producer———–>agent————>consumer

Producer———>retailer———–>consumer

Producer———->wholesaler—————->consumer

Promotion Mix: This deals with the communication aspect .its objective is to ensure that goods and services known to buyers i.e it helps to create awareness.

Forms of promotion are:

1. Advertising
2. Sales promotion
3. Publicity
4. Personal selling
5. Public relation
6. Product differentiation and branding/packaging.

Test and assessment

1. The means of dividing the market into market groups that enables the producer to serve their customers better is called———– (a)market segmentation (b)marketing mix (c)marketing concept (d)market research.
2. The four Ps of marketing mix was popularized by (a)Charles Taylor (b)Neil Bordon and Mc Carthy (c) Henry Murphy (d)non of the above.
3. The policy whereby the producer relatively reduces the prices of its goods is known as———- (a)market skimming (b)bid pricing (c)pricing above the market leader (c)market penetration (d)pricing with the market leader.
4. Products purchased to satisfy to satisfy personal or family needs is called———— (a)industrial product (b)company’s product (c)consumer’s product.
5. The strategy where the producer focus all her marketing mix on only one segment of the market is called———–(a)multi-segment strategy (b)concentration segmentation (c)double segmentation (d)one segmentation.

For more notes; see: http://passnownow.com/classwork-support/