Comprehensive Market Segmentation and Targeting Report, MKTG 4460

This report provides a comprehensive overview of market segmentation and targeting, focusing on the practical application of these concepts through a case study of Gucci. It begins with a definition of market segmentation, emphasizing its importance in organizational branding and customer targeting. The report outlines the principles of market segmentation, highlighting the need to provide products and services to the right customers at the right time. Using Gucci as an example, the report illustrates how the company segments its market based on factors like gender, culture, and economic well-being, leveraging both traditional and digital marketing tools. The report then details the objectives of market segmentation and targeting, including increasing brand awareness, improving marketing effectiveness, driving sales and revenue, and fostering customer loyalty. It also discusses the disadvantages of market segmentation, such as increased marketing costs and potential inventory issues, as well as the advantages, including efficient resource utilization and the ability to identify new profitable segments. The report concludes by emphasizing the significance of market segmentation in today's globalized market, where customers have diverse backgrounds and needs.

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Running head: Market segmentation and targeting MKTG 4460-01, Student Name, Student
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Market segmentation and targeting
University
Word count

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Running head: Market segmentation and targeting MKTG 4460-01, Student Name, Student
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Table of Contents
Introduction......................................................................................................................................2
Definition.........................................................................................................................................2
Principle of market segmentation....................................................................................................3
Example...........................................................................................................................................3
Objectives of market segmentation and targeting...........................................................................3
Disadvantages of market segmentation...........................................................................................4
Advantages of market segmentation................................................................................................4
Conclusion.......................................................................................................................................4
References........................................................................................................................................5

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Running head: Market segmentation and targeting MKTG 4460-01, Student Name, Student
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Introduction
This paper presents a market segmentation concept to have deeper insight over the topic. The
market segmentation is necessary for better organizational branding and brand positioning. The
market segmentation helps target the customers in a better way according to the unique
requirements of each group of customers (Ramaswamy & Ozcan, 2016). The paper gives an
example of a company named Gucci which sells fashionable products made of leather goods to a
wide segment of the population. The company sells clothes, handbags, footwear, and many more
leather-made goods by catering to the needs of diverse people belonging to different countries.
The company has its stores in advanced countries of world where it sells its products on retail
basis whereas in other corners of the world, the company operates on whole sale basis. The
company sells its products through online platforms as well as retail stores as per segmentation
of market.
Definition
The market segmentation entails categorizing the market in different groups based on unique
characteristics like the place, economic well-being, demography, gender, etc. This leads to
targeting of customers based on their requirements, thus better reaching the intended population.
The company will be able to access the market segments according to their unique needs leading
to relaying og message to intended or targeted population effectively. The proportional

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Running head: Market segmentation and targeting MKTG 4460-01, Student Name, Student
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marketing mix includes market segmentation as a basic tenet of marketing which tends to create
a win-win situation for all stakeholders associated with the company.
Principle of market segmentation
The market segmentation is based on the principle of supplying products or services at the right
time to the right population in the desired manner (Sargent, 2016). For example, a toy company
manufactures the products based on gender as male and female children have different choices
according to their age and sex. There are many other criteria to segment the population like
country, culture, ethnicity, etc. the market segmentation target each customer who can be
persuaded to buy the services or products from a particular company (Saboo, Kumar, & Ramani,
2016).
Example
The example considered in this Paper is Gucci, as mentioned above. Gucci targets its customers
based on gender, culture, place or country of origin, culture and economic well being. The tech-
savvy modern generation is provided with the facility of the website of Gucci where modern
customers can buy products depending on their choice according to their age. Along with this,
the trending and latest fashionable products are sold by Gucci to incite modern customers of the
21st century who have high expectations. Along with this, the traditional marketing tools are
used by Gucci to cater to the needs of old age population by setting up retail stores in various
advanced countries of the world (Skiera, Bayer, & Schöler, 2017). Another market segmentation
criteria used by Gucci is the gender whereby trendy and fashionable products are made available
to men and women based upon their gender.

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Running head: Market segmentation and targeting MKTG 4460-01, Student Name, Student
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Gucci targets customers from diverse backgrounds from the perspective of economic well-being.
This makes the organization vibrant enough to cater to the needs of several segments of the
market based on the economy.
Objectives of market segmentation and targeting
There are several objectives of market segmentation and marketing which are as follows:
a) To generate awareness regarding the products or services of the particular business
corporation among the local population
b) To better market the products and services among the intended population promptly leading
to relaying of vision and mission of the particular organization in an effective way.
c) To increase profit for the company by increasing sales and revenue generation which helps
brand positioning and organizational branding
d) To adopt the best practices related to marketing to communicate the best ideas to customers
in a synergized and synchronized manner
e) To increase the number of loyal customers by segmenting the population-based on different
needs
Disadvantages of market segmentation
Following disadvantages can be accrued from market segmentation:
a) With the change of characteristics of the segmented population, the products already
manufactured become useless leading to wastage of time and money

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Running head: Market segmentation and targeting MKTG 4460-01, Student Name, Student
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b) The cost of marketing gets increased due to special marketing plans for different segments
of the population. This increases the input cost leading to narrowing of profit margin. The
company may need to change the pricing strategies leading to loss of competitive advantage.
c) Maintenance of large inventory for distributors and manufactures leading to overstocking
in case of economic turmoil or any untoward situation
Advantages of market segmentation
Following advantages can be accrued from market segmentation and targeting:
a) Efficient utilization of resources by targeting the right customers at the right time
b) New profitable segments can be identified by better segmentation with budget allocation
according to the need
c) Setting up of realistic selling targets leading to better prediction of market response along
with knowledge about the customer response
d) Timely modification of the products or services as per customers’ response leading to prompt
action during exigencies
Conclusion
Market segmentation is helpful to reach modern customers in a better way through various
means of marketing which include traditional as well as digital marketing (Stephen, 2015). The
products or services are sold to customers depending on the segmentation of the market done in
the form of various groups. This leads to better organizational branding and brand positioning
helpful to generate awareness regarding the products of the company. Gucci has used the market

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Running head: Market segmentation and targeting MKTG 4460-01, Student Name, Student
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segmentation and targeting concept effectively which has resulted in an increase in traffic on its
website along with an increase in the number of units sold. Thus, market segmentation has
become important in the era of globalization whereby the customers are from different
backgrounds having different needs.

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Running head: Market segmentation and targeting MKTG 4460-01, Student Name, Student
Number,

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Running head: Market segmentation and targeting MKTG 4460-01, Student Name, Student
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References
Ramaswamy, V., & Ozcan, K. (2016). Brand value co-creation in a digitalized world: An
integrative framework and research implications. Elsevier, 78-89.
Saboo, A. R., Kumar, V., & Ramani, G. (2016). Evaluating the impact of social media activities
on human brand sales. Elsevier, 50-67.
Sargent, P. (2016). A digital marketing strategy for the SAH Journal. Approach and findings.
Pauline Sah Journal, 34-38.
Skiera, B., Bayer, E., & Schöler, L. (2017). What should be the dependent variable in marketing-
related event studies? Elsevier, 56-78.
Stephen, A. T. (2015). The Role of Digital Media ans Socia Media Marketing in Consumer
Behavior. Current Opinion in Psychology, 34-45.