Marketing: Importance of Market Analysis and Segmentation

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Introduction to Marketing
Essentially, marketing has become an integral element of any business in the highly
competitive contemporary business environment both locally and internationally. Marketing is a
complex process that consists of all the activities involved in preparation for sales, (Tanner, Jeff,
and Mary, 2015). The local and global business environment is dynamic with several internal
and external interrelated factors shaping the market dimensions continuously. In order for any
business organization to survive or strive in business, it has to be flexible in their marketing
tactics so as to attract new customers and retain the old customers as well.
Marketing is driven by the urge to fill the gap existing between the product or service
and the potential customers. The concept of 7 Ps, that is, product, price, place, promotion,
people, positioning and packaging, is commonly used in marketing, (Abdul-Hamid, Ibn Kailan,
et al, 2017). Marketing involves producing the right product that will be available to the right
customers at the right place and time.
The main purpose of marketing is to create utility. A utility is defined by the American
Heritage dictionary as the quality or condition of being useful, (Hair, Joseph, and Bryan, 2014).
Utility refers to the ability of any product or service to satisfy the needs and wants of the
customers. There are four types of utility namely possession utility, time utility, form utility and
place utility.

In order for any business organization to make more sales in a competitive business
environment, they have to perform a good market analysis. Customer satisfaction should be the
key driving force behind the operations of the organization. Market analysis involves analyzing
market opportunities through defining the market, sales forecast and demand analysis, company
resource assessment and consumer assessment. Secondly, market analysis involves identification
the market segments and selecting target market groups to put more emphasis on them.
Identification of the market segment allows a business to understand the needs of their
consumers as well as gain a comprehensive understanding of their purchasing habits and power.
Understanding the target segment will help the organization become creative in producing or
offering goods and services that meet the specific needs and demands of their customers. The
needs and wants of the customers change continuously thus it is important for any business to
have an interactive engagement with their customers, (Hill, 2015). Establishing good customer
relations promotes brand loyalty which is good for business.
Market analysis also helps in developing marketing strategies that help an organization
create and maintain a competitive advantage over their competitors. Development of market
strategies involves the process of positioning, considering the dynamic global challenges and
opportunities, modifying the production life cycle as well as making choices on the most
appropriate strategy to be adopted by the organization. Marketing also involves planning of
marketing programs. Marketing programs and practices include managing brands and packaging,
selection of the suitable marketing channels, selecting the suitable pricing strategies, designing
promotion activities, managing wholesaling, distribution and retailing among many more
activities, (Weinstein, Art and Dennis, 2014). Marketing also requires coordination and