Achieving Superior Customer

Responsiveness
• Achieving superior responsiveness to customers means giving
customers value for their money, and steps taken to improve
the efficiency of a company’s production process and the
quality of its products should be consistent with this aim. In
addition, giving customers what they want may require the
development of new products with new features.
• To achieve superior customer responsiveness, a company must
give customers what they want, when they want it, and at a
price they are willing to pay—and not compromise the
company’s long-term profitability in the process.
• In other words, achieving superior efficiency, quality, and
innovation are all part of achieving superior responsiveness to
customers.
 Who are Our Customers?
Market Segmentation

• In managerial aspects, business-level strategy begins

with deciding who the company is going to serve,
what needs or desires it is trying to satisfy, and how it
is going to satisfy those needs and desires.
 What is Market Segment?
• A market segment is a group of customers who share
one or more common characteristics, needs and
wants
• Each market segment is unique, and marketers use
various criteria to create a target market for their
product or service.
• Marketing professionals approach each segment
differently, after fully understanding the needs,
lifestyles, demographics, and personality of the target
customer.
 Bases/Variables for segmenting Consumer
Markets

• Geographic segmentation.
• Demographic segmentation.
• Psychographic segmentation.
• Behavioral segmentation.
• Geographic segmentation refers to dividing a
market into different geographical units such
as nations, states, regions, cities, or
neighborhoods.
• For example, national newspapers are
published and distributed to different cities in
different languages to cater to the needs of
the consumers.
• It is the simplest type of market segmentation.
• City
• Region
• Country
• Climate
• Urban or rural
• Demographic segmentation divides the
markets into groups based on variables such as
age, gender, family size, income, occupation,
education, religion, race and nationality.
• Demographic factors are the most popular
bases for segmenting the consumer group, as
consumer needs, wants, and usage rates often
vary closely with the demographic variables.
• Age
• Gender
• Income
• Religion
• Family Status
• Occupation
• Education
• Ethnicity
• Psychographic Segmentation categorizes
audiences and customers by factors that relate
to their personalities and characteristics.
• Psychographic profiles are prepared on the
basis of patterns of responses that emerge
from people’s activities, interests and opinions
• Personality traits
• Values\Beliefs
• Attitudes
• Interests
• Lifestyles
• Psychological influences
• Motivations
• Behavioral segmentation uses consumer
behavior aspects for dividing the market.
Consumers differ their ways of usage and
faithfulness to a product.
• These activities may relate to how a customer
interacts with a brand or to other activities
related to the brand.
• Purchasing habits
• Spending habits
• User status
• Usage rate
• Brand interactions
• Measurable means the market size, buying
ability and profile of the segments should be
measured.
• Market segments are usually measured in terms
of sales value or volume (i.e. the number of
customers within the segment).
• Measurements are very important to be able to
evaluate the overall attractiveness of each
segment.
• Substantial means the market segments should
be large enough, in terms of sales and
profitability for the firm, so that it can get
financial return of its investment.
• A market segment is useful when it contains a
larger homogenous group with clearly defined
characteristics such as age group, socio-
economic background and brand perception.
• Accessible means the market segment should
be reachable, particularly in terms of
distribution and communication.
• Firms should effectively reach and serve the
different segments and obtain their attention
through outdoor advertising, social media
campaigns, television commercials, or any
number of other approaches.
• Differentiable means each segment of
consumers should be relatively unique, as
compared to the other segments and they
should respond differently to different
marketing programs.
• Differences between market segments should
be clearly defined, so that the campaigns,
products and marketing tools applied to them
can be implemented properly.
• Actionable means the market segment must
have practical value, so that the firm can
formulate effective programs to attract and
serve the segments.
• The firm needs to be able to implement a
distinctive marketing mix for each market
segment based on its capabilities and
resources, so very specialized segments may
not be appropriate.