What is Marketing?

Focus: Market Segmentation

Introduction:
Marketing is the art of creating value by building strong relation with customers by
understanding their needs to maximize profit. The concept of marketing is to consider the
customers’ needs and serve them in a way which is mutually beneficial.

“Marketing is the activity, set of institutions, and process for creating, communicating, delivering,
and exchanging offerings that have value for customers, clients, partners, and society at large.”

(American Marketing Association, 2013)

One of the most important activities of marketing is Segmentation. To have an effective marketing
policy, understanding the customers needs and grouping them appropriately is essential as it helps
the organization to serve them better. Hence it is necessary to a clear idea about the process of
segmentation.

Segmentation:
“Kotler (2010) describes Segmentation as the classification of consumers within a market
that share related needs and establish related purchasing behavioural habits.” - Martin, G. (2011).
The Importance of Marketing Segmentation. American Journal of Business Education, 4(6), 15. In
simple terms, Market Segmentation is dividing the market into smaller groups to help serve the
customers more accurately and profitably. With the recent rise in important of marketing in most
organisations, segmentation is becoming an extremely urgent part because it helps to target the right
audience and deliver the right product.

Each consumer has specific needs and wants and serving each one is impossible as it will be too
expensive. As the concept of mass marketing was introduced, it put an end to production of a
specified product for each customer. But mass production meant that there was a reduction in
availability of choices of products. Due to this major limitation, marketers started diving the market into
smaller groups of customers with similar needs, and this in return gave them the competitive edge as
their products were more suited with the needs.