Market Segmentation

This document discusses the concept of market segmentation and its significance in developing branding strategies and building customer relationships. It focuses on the case of Microsoft Corporation and explores the various segments identified for the organization. The document also delves into the positioning strategies, leveraging brand identity, and building brand relationships. The study concludes by emphasizing the importance of customer relationships in the market.

Running head: MARKET SEGMENTATION
MARKET SEGMENTATION
Name of the Student
Name of the University
Author Note

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Table of Contents
Introduction................................................................................................................................2
Company Background................................................................................................................2
Segmentation Targeting and Positioning...................................................................................3
Segmentation..........................................................................................................................3
Targeting Strategies...............................................................................................................3
Value Segments of Target Markets............................................................................................3
Brand Strategy............................................................................................................................5
Positioning Strategies.............................................................................................................5
Leveraging the Brand Identity...................................................................................................6
Brand Relationship.....................................................................................................................6
Conclusion..................................................................................................................................7
References..................................................................................................................................8

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Introduction
Market is one of the most dynamic platforms that is the rationale behind the strategies
that the organizations take for the segmentation of the products. Segmentation becomes a
significant part for the organization to deal with such activities that are required for the
development of the key areas influencing the key aspects of the market (Weinstein and
Winston 2016). The chosen organization for the study is Microsoft Corporation. The study
will be stating about the organizations and complexities of the market that will be liable for
the identification of the branding strategies along with the ways the brand is associated with
building relationships. The study will also focus on the positioning of the organization. Study
will discuss the stated parts but after stating about the company.
Company Background
Microsoft is one of the most influential brand in the whole world. The company was
started in 1975, founded by one of the richest man in the world Bill Gates and Paul Allen
(Microsoft.com 2019). The company is currently involved in being the largest software
maker by revenue (Forbes.com 2019). The company is associated with significant industries
such as computer software, hardware, consumer electronics, networking services, cloud
computing and many more. The company does have a product portfolio inclusive of
Windows, Office, Servers, Software, Allied Services, Gaming Consoles, Visual Studio along
with search engine like Bing. The company’s revenue for the year 2018 was USD 110.36
billion (Microsoft.com 2019). The company is associated with dealing with 134,944
employees (News.microsoft.com 2019).

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Segmentation Targeting and Positioning
Segmentation
The key segments that have been identified in case of Microsoft is stated below for
the study. The key segments are;
Demographic: This is a segment that has been utilized by addressing the aspects such as age
and occupation of the segment to address the issue that are related to the development of the
segment.
Behavioural: The organization also utilizes behavioural segment in order to create a segment
that is based on the aspects such as usage frequency, occasion and the benefits that are
needed by the consumers. There is another behavioural aspect such as the brand loyalty for
the products such as Microsoft windows and office suites that engages them with the
offerings of the products.
Targeting Strategies
The key target market for the organization based on the various segments is inclusive
of the mix strategies that is stating about the activities such as differentiated and
undifferentiated factors of the organization. Microsoft is having a wide range of product
offerings, thus it becomes significantly important to address the target market with both
differentiated and undifferentiated strategy while considering the market. The population for
the target is homogeneous in nature and target market is consisting of the entire world.
Value Segments of Target Markets
Microsoft being one of the major companies it is one of the most important part for
the organization to deal with the identification of the customers. There are four key aspects of
the Roy Morgan’s value segments. These key aspects are based on the life satisfactions,
individualism along with quality expectations. These also includes price expectations,

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innovation and progressiveness that have influences the aspects. Incorporation of such factors
have helped in the determination of the segments for the company.
The segments that have been suggested by Roy Morgan is stated below:
Consumer with Socially Aware: This is a segment that is stating about the buying pattern
that is liable for creating its own segment (Roy Morgan 2019). This is a segment which is
idealistic in nature and this can help in defining the various aspects of the organization for
Microsoft.
Consumer with Visible Achievement: This is a segment that is inclusive of the customers
who are already famous for their achievement and they are having a sense of control in their
life (Roy Morgan 2019). This targeted consumers are having a psychographic approach to
ensure their influence in external environment.
Consumer with Young Optimism: This is a segment that have influenced seeking for more
improvement in their consumer products (Roy Morgan 2019). This is segments of the
consumers who are involved in the process of trying everything. The young people are
involved in the process of developing a conscious approach.
Consumer with Real Conservatism: This is a segment that is inclusive of the buyers that
will be projecting the activities liable for their conservative ethical and moral values (Roy
Morgan 2019). This segment for Microsoft is important to address the customers who have
been loyal to the company for a long period.
Consumer with Conventional Family Life: These are the segment of the customers who are
involved in the process of seeking more value from their products (Roy Morgan 2019).
Microsoft can target these segments by offering products with values.
Summary

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To summarize the study it has been observed that there are vital segments for Microsoft
Corporation and this can help the company in the determination of the positioning strategies
that will be responsible for creating a cognitive space in consumers’ mind.
Brand Strategy
The brand needs to strategize based on the activities that will be required for the
development of the key areas that will be responsible for the development of the growth path
for the company. Two of the most important strategies that are associated with the
organization are the strategy to identify and evaluate the positioning of the brand and evaluate
the brand identity of the organization. Thus, these factors are stated below in the discussion:
Positioning Strategies
Vast product portfolio is one of the major factor that is needed towards that
development of the positioning strategy (Roymorgan.com 2019). There are commonly three
stages of positioning that is required to be considered. Three stages are top of mind recall,
aided awareness and unaided awareness. Microsoft being one of the major player in the
market it is one of the most significant attribute towards strategizing the positioning based on
these aspects that will be liable for the organizational growth (Roy Morgan 2019). There are
three factors that influences the positioning of the organization that includes differentiation,
cost effectiveness along with focus on the brand identity of the organization.
Differentiation: The key differentiation strategy that has been taken by the organization is to
incorporate the changes that will be impacting the aspects of the organization. This is one of
the most influential part for the organization that will be liable for the positioning in the
cognition of the customers (Hoberg and Phillips 2016). Microsoft differentiates themselves
from the other competitors via their service and their product experience.
Cost Effectiveness: Microsoft does involved in the process of developing the key areas that
will be responsible for their cost effectiveness of their products. Microsoft does provides a

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value for money products that enables them with the developing a reputation for the brand in
the cognition of the customers.
Brand Identity: Microsoft does provides some of the most unique set of values that will be
liable for the serving the customers with quality service. This is one of the major factor that
contributes towards the development of the areas that creates an impact on the cognition of
the brand (Khedher 2015). Microsoft is involved in the process of creating an environment by
serving their products.
Leveraging the Brand Identity
Companies does get involved in leveraging the brand identity (Roymorgan.com
2019). The company does leverage their fame in the operating systems market in the other
categories such as browsers like Edge, for game consoles like Xbox and search engines like
Bing. Brand identity is one of the major positive for Microsoft Being involved in such a big
company they do use their brand identity for their new product line up such as Surface Series
for laptops. Microsoft have also leveraged their brand name in the past while dealing with
Lumia smart phones. The company does involved in the process of leveraging the brand
image for the development of their new products (Roy Morgan 2019).
Brand Relationship
Relationship with the customer is one of the most significant factor that contributes to
the development of the market (Chinomona 2016). One of the most influential target for
Microsoft is the real conservative, socially aware and consumer with conventional family
segment that is inclusive of the enthusiasts who are involved in the process of developing the
key areas that will be liable for the development the products.
Building Relationship: The most utilized ways that Microsoft can use to build a better
relationship with the targeted base of the customer is by spreading awareness about the

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unique value proposition (Grace, Ross and King 2018). The company can get indulged in the
process of developing the key areas that will be responsible for developing attitude towards
the company.
New Product development: Microsoft can incorporate the requisite strategy to develop the
products that are more suitable for the segments such as young optimist and people with
socially aware to create a relationship with the customer.
Provide Value to Customer: Proving values can help owners to set the key responsibilities
that will be helpful for the development of the relation between the organization and the
customer (Grace, Ross and King 2018). It is the duty of the top level management to get
indulged in the factors that will be liable for the development of the key processes that are
associated with providing the values to ensure better customer relationship.
Conclusion
Throughout the study it has been observed that target market is one of the major
contributor towards the development of the organization. Microsoft being such a big
organization it is important for them to get involved in the process of developing the key
areas that will be liable for a better customer relationship. The strategies that have been
identified for the segmentation of the target market has provided a positive perspective. To
summarize the study it can be concluded that there is significance of the relationship with the
customer.

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References
Chinomona, R., 2016. Brand communication, brand image and brand trust as antecedents of
brand loyalty in Gauteng Province of South Africa. African Journal of Economic and
Management Studies, 7(1), pp.124-139.
Forbes.com 2019. [online] Forbes.com. Available at:
https://www.forbes.com/global2000/list/#industry:Software
%2520%2526%2520Programming [Accessed 24 Mar. 2019].
Grace, D., Ross, M. and King, C., 2018. Brand fidelity: a relationship maintenance
perspective. Journal of Brand Management, 25(6), pp.577-590.
Hoberg, G. and Phillips, G., 2016. Text-based network industries and endogenous product
differentiation. Journal of Political Economy, 124(5), pp.1423-1465.
Khedher, M., 2015. A Brand for Everyone: Guidelines for Personal Brand
Managing. Journal of Global Business Issues, 9(1).
24Microsoft.com 2019. FY18 Q4 - Press Releases - Investor Relations - Microsoft. [online]
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Q4/press-release-webcast [Accessed 24 Mar. 2019].
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2019].
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loyalty-programs-really-201609261433 [Accessed 24 Mar. 2019].
Roy Morgan 2019. Industries. [online] Roy Morgan. Available at:
http://www.roymorgan.com/industries [Accessed 24 Mar. 2019].

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Roymorgan.com (2019). Values Segments. [online] Roy Morgan. Available at:
http://www.roymorgan.com/products/values-segments/ [Accessed 4 Apr. 2019].
Roymorgan.com 2019. [online] Roymorgan.com. Available at:
https://www.roymorgan.com/~/media/files/papers/2003/20030401.pdf?la=en [Accessed 24
Mar. 2019].
Weinstein, A. and Winston, W., 2016. Defining your market: winning strategies for high-
tech, industrial, and service firms. Routledge.