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The Product Related Segmentation Marketing Essay

Paper Type: Free Essay Subject: Marketing
Wordcount: 2679 words Published: 1st Jan 2015

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This assignment is about understood and studies the consumer behaviour. In this report there are two researches to be found in regards of KS Ltd plan to launch a wide range of personal laptops to cater for many types of customer and the author have to list and explain the a few of market segmentation that the company can use to segment their market and select one of the market segment that the company aim for. In the second question, the author has make a research on consumer decision making process and discuss every stages in detail with relevant example.

For this research project, the author categorized the project into four sections. There are introduction, market segmentation, consumer decision making process and conclusion.

On the introduction, the author has explained what consumer behavior is. In consumer behavior, marketer studies the importance of consumer behavior on the way to understand their behavior on how they make a decision on buying a product or services and results to company growth if the marketers can understand what and how to satisfy consumer needs and wants.

In finding of question one, the author has explained about identifying the specific needs and wants of customer group in the market segmentation in order to satisfy consumer needs and wants. There are four common bases segmenting consumer markets that KS Ltd can target to the customer, geographic segmentation, demographic segmentation, psychographic segmentation and product related segmentation which helps to identify differences in buying behavior. The author has selected product-related segmentation to target their consumer.

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For question two, the author has explained the consumer decision making process is to gathers and assess information of people thoughts and opinion people gathers and make choices among alternative products, services, organizations, people, places and idea. Throughout the process, marketers are able to know how a consumer think and target them in order to purchase the product or services.

At last in the conclusion, the author has emphasize the importance of consumer behavior again and to explained the importance of choosing the right market segmentation to market the right consumer and from the consumer decision making process, marketers will understand the behavior of how a consumer will purchase a product though the process.

TABLE OF CONTENTS PAGE

Executive Summary 1

Introduction 4

Market Segmentation 4

Geographic Segmentation 5

2.1.1 Demographic Segmentation 6

2.1.2 Psychographic Segmentation 6

2.1.3 Product-Related Segmentation 6

2.1.4 Summary 7

2.2 Consumer Decision Making Process 7

2.2.1 Problem Recognition 8

2.2.2 Information Search 8

2.2.3 Evaluate Alternative 9

2.2.4 Purchase Decision 9

2.2.5 Post Purchase Evaluation 10

3.0 Conclusions 11

4.0 References 13

1.0 Introduction

In this business world, organizations have to understand of how consumer behaves with regards to what they buy in order to sell a product or service effectively. Therefore, organizations often study consumer behavior to determine how and why a consumer makes decision to purchase or not to purchase a product or service. (Neal, 1999) Regardless in a small business or an organization, understanding how is the customers to buy your products and service will definitely help a company grow and expand by responding to consumer needs and meeting their satisfaction. Marketers borrow extensively from psychology and sociology to better understand consumer behavior. And therefore, a company has to make use of all the information from marketing strategy to satisfy target consumer needs.

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In order to effectively understand consumer behavior in achieving customer satisfaction and needs and wants, a company have to develop a wide variety of products to meet very different needs and to understand a few segmentation variables the company can use to segment their market and which segment could the company can aim for to meets their consumer needs as well as to satisfied their customer to gain trust in the company and build customer loyalty.

2.0 Market Segmentation

KS Ltd Plan to launch a wide range of personal laptops to cater for the many types of customers. In order to target and satisfied different kind of consumer needs and wants, market segmentation are crucial to enable the business to better target the products at the right customer. Market Segmentation is about identifying the specific needs and wants of customer groups and then using those insights into providing products and services which meet and satisfied customer needs and wants. It also can adjust marketing strategies to meet the needs of each group. There are four common bases segmenting consumer markets that KS Ltd can target to the customer, geographic segmentation, demographic segmentation, psychographic segmentation and product related segmentation which helps to identify differences in buying behavior.

2.1 Geographic Segmentation

Geographic segmentation is a division of an overall market into homogenous groups based on their locations. Marketers look at total population, a variety of economic variables, geographic indicators and migration patterns to determine market size. According to Kurtz 2010, Geographic location does not ensure all consumers in a location will make the same decisions, but this segmentation approach helps to identify some general patterns. And therefore, marketers need to pay attention to areas with quickly growing populations to plan for the future. Through this segmentation, the marketers of KS Ltd need to look into the population each of every state. The marketers are too have to find out the fastest-growing states and lowest-growing states in order to plan the strategies on what range and types should target in the particular states.

2.1.1 Demographic Segmentation

Demographic Segmentation is the most common of market segmentation. In Kurtz, 2010, Demographic segmentation is also called socioeconomic segmentation as this segmentation defines consumer groups according to demographic variables such as, gender, age, income, occupation, education, sexual oriented, household size and stage in the family lifecycle. Through this segmentation, KS Ltd marketers are able to come up with a list of demographics like statistic, characteristic and qualities that represent the ideal target market and segmented into several to help to target the consumers more accurately. Furthermore, this segmentation is closely linked to variables of customer wants. Marketers can easily collect more data to understand in order to meet consumer satisfaction.

2.1.2 Psychographic Segmentation

This Segmentation is used mainly to target a certain group from within a population. Psychographic segmentation is one which uses people’s personality, social class, lifestyle, their activities interests and opinions to define a market segment. It is based on the assumption that the types of products and brands an individual purchases will reflect that persons characteristic and patterns of living. KS Ltd can use AIO statements (Attitude, Interests and Opinion) method for developing psychographic research of a population to conduct a large-scale survey by asking opinions, interests, needs and wants to agree or disagree with the products.

2.1.3 Product-Related Segmentation

In Kurtz, 2010 explained that product-related segmentation involves dividing a consumer population into homogeneous groups based on their relationships to the product such as, segmenting based on benefits people seek when they buy a product; on usage rates for a product or consumers’ brand loyalty towards the products. For this segmentation, KS Ltd can linked and use the demographic and psychographic segmentation on their products and positioning their product in order to strengthen and creating brand loyalty.

In Author opinion, KS Ltd could aim and focus product-related segmentation to target their consumers. Take an example, a customer looks for when buying the company laptop, where customer may buy one just for basic use, internet surfing or office documents use, in each case, customer needs are different. So here the marketers can identify benefits a customer looks for when buying the company products. On the other hand, if the customer is buying a laptop for their children as courage for their children, customer now is looking for intangible benefits. Besides of that, Marketers can link to use other demographic and psychographic segmentation to segment a total market by grouping people according to the amounts of a product they buy. KS Ltd can differentiate as heave users, moderate users and light users to benchmark quantity for each segment. At last but not least, KS Ltd could use brand loyalty to segment their market to consumers. If the customer are hard core loyal in the product, those customer will continue to buy the same brand over and over again. This would make customer refuse the competing brand even other brands are launch new products or having promotion.

2.1.4 Summary

In short, market segmentation is important to target the consumer needs and wants in order to make the consumer to purchase the product. KS Ltd can actually using multiple segmentation bases as this could help the company to increase the accuracy in reaching the right markets. (Kurtz, 2010) Therefore, in order to get to know their customer better and satisfy their needs, marketers have to take more time all these research to help to sell the products.

2.2 Consumer Decision making Process

Consumer’s decision making process is the ways which people gathers and assess information and make choices among alternative products, services, organizations, people, places and idea. “It is particular important to marketers is the way in which situation internal and external sources of influence affect the consumer purchase decision process” (Neal, 1999) There are two levels of purchases decision which are high-involvement purchase decision and low-involvement purchase. High-involvement purchase decision is consumer who’s deciding of high levels of potential or economic consequences like, purchase a car or houses. For low-involvement purchase decision is represented by the habitual decision like buying clothes or a drink. When consumers show an interest in buying a product, consumers will follow a decision making process. There are five steps in the consumer decision process, problem recognition, information search, evaluate of alternatives, purchase decision and post purchase evaluation.

2.2.1 Problem Recognition

The first stage in the buying decision is problem recognition. According to Neal, 1999, the recognition of a problem is the result of a discrepancy between a desired state and an actual state that is sufficient to arouse and activate the decision process. Consumers are hesitant to react to unfulfilled desires because the product or services cannot satisfy their needs. For recognition of the problem example, the need for a personal computer may take longer because there may be more subtle problems, which take more then to consider. So the core of the marketer’s goal is to understand consumers unsatisfied needs, and to show the consumer how the product will fulfill that need.

2.2.2 Information Search

Once the problem is recognized, the consumer gathers information about the attainment of a desired state. This search may content of internal and external sources of information. This used of information from memory is referred to as internal search and the search process is focused on external stimuli relevant job solving the problem is referred to as external search. (Neal, 1999) Likewise, a consumer may notice of a new laptop launching in the store and then the consumer may read about the attributes of the product, and this represent the consumer has limited decision making involve mainly internal information. But if this consumer seek for more information at other brands that may be similar as the first product they saw and make a comparison of the product, this would be the example of limited decision making involve both internal and external information. This research will result to increase product and market knowledge and enhance personal influence as well as personal satisfaction.

2.2.3 Evaluation of Alternatives

The third step in the consumer decision process is to evaluate the evoked set of opinion. The alternatives are evaluated on the basis of the consumer’s criteria to guide the selection and the relative importance of these criteria. The common criteria include price, brand image, income level social class and culture. The number of evaluative criteria used by consumers depends on the product, the consumer and the situation. Therefore, it is important that the marketer to focus on evaluative criteria as they can try to educate consumer about attributes the view of importance of the products and show why a specific brand fulfills those criteria. At last, they will try to induce consumer to expand the evoked set to include the marketed product.

2.2.4 Purchase Decision

Once the product has been selected, the consumer has evaluated each alternative, and then narrowed the alternative down to one, at last, the consumer has decided to buy and pay for the product. Purchase decision remaining at this stage center on the shop of purchase. After purchase the product, the next step will be an evaluation of the purchased product.

2.2.5 Post purchase Evaluation

At this post purchase evaluation, the purchase act will leads to two results. Is either the consumer feel satisfy of not satisfy with the product they bought. The level of satisfaction that the consumer will experience will depend on how many of the consumer was met; meet-or exceed their expectations. At some circumstances, consumer may experience post purchase anxiety called cognitive dissonance. This anxiety results from a imbalance among a person’s knowledge, belief or attitudes. Consumer might experience dissonance when they spend a lot of money on the product but this product failed to exceed their meets and satisfaction. This may cause consumer decide reject and not to purchase this product anymore. Therefore, marketers should provide information that supports the chosen item in order to reduce the cognitive dissonance and continue use this product.

3.0 Conclusion

In conclusion, Consumer behavior is the way a person reacts to purchase focused marketing material or action. It is difficult to predict, even for experts in the field, it is vital to study consumer buying behavior and understand customer needs and wants and how it works in order to meet their satisfaction.

Through the market segmentation, KS Ltd will know which market segmentation to use to market their products to the consumer in order to achieve company goals. With several of segmentation, KS Ltd could use aim for one segmentation to fully utilize and target the consumers. With understanding consumer decision making process, marketers could evaluate criteria are used by the consumer and look for the ways the consumer perceives the various alternative in terms of each criterion and improve or change the product features to affect consumer buying perspective. The marketers are also able to come up with the right marketing strategies in order to the right target market.

 

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