Market Segmentation Can Help You Grow, or Gain, Market Share

You dont need to buy market share, you need to learn how to earn market share. Market segmentation is one of the functions within the overall marketing plan that will help you earn your share of the market. By segmenting your market into more targeted buyers or groups of buyers you will be able to grow existing sales and build new sales; and grow them without cutting price. The goal for market segmentation is to target the most likely to buy and understand your target market enough to focus in on what it needs.

There are a number of different levels of market segmentation: mass marketing, segment marketing, niche marketing, local marketing, one-to-one or direct marketing - each level has different attributes.

In mass marketing, you produce one product that serves all markets and that can be produced in mass and distributed in mass. For example, paper clips, which can be mass produced, mass distributed and can serve all its markets business, financial, school, etc..

In segment marketing, your product can appeal to buyers in different groups or segments. These buyer segments have similar needs and wants. Segments are determined by assessing certain criteria. For example, product-usage patterns, demographics, psychographics, and geographics and more. The benefit of segment marketing over mass marketing is that you can narrow the product offering to specifically address the needs of the market segment you have defined as your primary, or secondary, or tertiary market. The other elements of marketing mix; price, promotion and distribution can also be more focused to deliver the needs of the market segment.

In niche marketing, you will narrow the market segments even further to find smaller markets that are less populated by competitors and that are under-served by others. To find your niche market, assess the market segment for similar needs and wants and divide the segment into smaller niches. To do well in niche marketing you must understand your customers extremely well and you must be able to understand their business, or their needs and wants well enough to provide solutions. Specializing in niche markets often results in higher costs not the economies of scale that you find in mass marketing, and even to some degree, in segment marketing, and also higher profits if customers recognize and accept the value your product brings.

In local marketing, you will focus on a local area or region to market your product. This does not mean that your product is not sold globally, it means that you focus on building marketing programs or tactics that address the local area needs and wants for your product. For example, shopping in Vancouver, British Columbia typically is at street level so storefront displays are large and dramatic; while shopping in Calgary, Alberta often happens inside malls because of weather conditions, resulting in smaller storefronts inside the mall and smaller scale displays.

One-to-one or direct marketing is the latest marketing segmentation strategy and it comes from a segmentation approach called individual marketing. One-to-one marketing is a segment of one, compared to a segment of many. Building your marketing concept is focused on how to identify the needs of one individual and how to target that one in your marketing plans. To be successful in direct marketing you must be able to either collect or acquire data on individual buyer behavior, habits, and attitudes many loyalty card programs collect that type of data. Computer technology has enabled this type of market segmentation.

To best identify your market segments, you will need to conduct research surveys, perhaps by using focus groups or other exploratory interview techniques; you will need to analyze the data you gather; and then you will need to develop a profile of each segment that you identify. Be aware that consumer and business market segmentations use somewhat different approaches to reflect the differences in consumer and business markets.

Once you have identified your market segments, you must evaluate and select the target marketing segment and approach best suited to your product, and to your business objectives, strategies and resources. Your small business growth objectives can be supported by a strong market segmentation approach.


About the Author

Kris Bovay owns Voice Marketing Inc, the business and marketing services company. Kris has worked for, and with, a range of small, medium and large businesses and has been able to help business owners focus on their challenges and improve their business results. For more business advice, visit

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• How To Drum Up More Business In Essex

The Importance of Marketing Mix and the 4 Key Mix Elements

The marketing mix section of your small business marketing plan concentrates on the tactics used to achieve the marketing and business plan. Those tactics can be categorized as the four Ps of marketing: product, price, promotion and placealso known as the distribution channel.

A common analogy used in describing marketing mix is relating the mix in marketing mix as being the ingredients in a recipe: you need to get the quantities of each element right or the result will not be what you need or expect.

Consider the following questions carefully when you build your marketing plan:

When developing your marketing tactics for the product, you must consider the features, advantages and benefits of the product. Define all the characteristics of your product. Define and rank which are most valuable to your target market Why are they valuable to your market Define what is unique about your product and why it has a competitive advantage something that is not easily duplicated. Consider conducting a marketing research survey to test your assumptions. You may be surprised to find out that what you thought was important to your market is not. Make sure you can address all these questions in your marketing plan.

Pricing your product sounds like a straightforward process but the reality is that it is a very complex process. At what stage in the life cycle is the product Product life cycle stages will influence price. Are you the high cost, high value provider Or the low cost, high volume provider Does your product have unique attributes that can not be easily duplicated Does your product have a competitive advantage not easily overcome Are you trying to buy your way into the market Be very careful with this buy-in strategy --it is often very challenging to move a low price up. Is this product a loss leader for your sales of another, more profitable product There are still more questions to consider when developing your price and you must analyze each answer carefully before determining the price for your product. Typically it is a good idea to plot your price attributes on a grid - you can visually see where you are on a grid and better assess if that is the right place to be.

Promotion includes a number of marketing communications tactics. Should you build a direct mail program is your product conducive to a printed description; do you have a good targeted mail list Can you market your product online Are traditional advertising methods print, radio, television the most appropriate What kind of budget do you have Does your product have a strong enough brand If not focus on building a stronger identity and brand. How can public relations efforts help you promote your product Can you successfully participate in trade shows and industry events to sell your product How will you craft your sales story: from sales letters to sales pitches Have you build measurements into each of your promotional vehicles Do you truly understand your market and your audience Recognize that you will need to use more than one of these tactics to launch a successful marketing campaign.

Place is how your product moves to market. What distribution channel will you use Will it be a business-to-business channel or a business-to-consumer channel Will you sell using your own sales staff, or will you outsource sales and use distributors or sales agents Can you sell your product online or must it be offline and in-person Is your market geography wide or narrow What are the implications of the answers to these questions on your marketing mix

When building and creating your marketing plan you must consider these elements of your marketing mix because they will have a significant impact positive if well planned and managed; negative if poorly planned and not managed on your products success or failure.

All small business owners go into business expecting success; not all plan for success. Ensure that your small business enjoys success by developing a strong strategic marketing plan that includes a comprehensive marketing mix.


About the Author

Kris Bovay owns Voice Marketing Inc, the business and marketing services company. Kris has worked for, and with, a range of small, medium and large businesses and has been able to help business owners focus on their challenges and improve their business results. Kris has a masters degree in business administration, with a specialty in marketing, operations, planning and strategy. For more business advice, visit

Relaited Links:

• How To Drum Up More Business In Essex