Product Service Factors and Segmentation Strategy for Timbre Group

This report provides an analysis of Timbre Group's product service factors and market segmentation strategies, focusing on their potential expansion into Shanghai, China. It examines the company's various offerings, including live music venues, food and beer delivery, music education, and artist management. The report delves into the Chinese market dynamics, highlighting the increasing disposable income and evolving consumption patterns of Shanghai residents. It includes a customer profile and demand analysis, geographic segmentation, demographic segmentation, and psychographic segmentation to identify target markets. The report also emphasizes the importance of adapting to the Westernized lifestyles of the younger generation in Shanghai and their demand for quality entertainment, food, and music experiences. The analysis uses data and market research to assess the viability and potential success of Timbre Group's business ventures in the Shanghai market.

Timbre Group Product Service Factors
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5.0 Product Service Factors
Timbre Group has several offerings as live music venues at several locations, food and beer
delivery, music education, music and artists agency and also organizes festivals (Sharma 2013).
The group runs some of the most successful bars and concept based eateries in the country. The
group has been hinting at a social change within the hospitality business market.
Markets analysis of China as per Euromonitor reveals that food industry will become more
dynamic with faster growth as compared to current value. Rising disposable income amongst
Chinese consumers with premiumisation factors reveals is bound to drive sales in the food
industry. Consumers in China exposed to greater levels of stress with fast lifestyle are more
eager to go to listen to music, artistry performances or consumer food. As demand from food and
live music increases segmentation present within the market is expected to further support rising
demands into a virtuous circle.
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Figure 1:Increasing Disposable Income & Consumption Expenditure in Shanghai
Source: (HKTDC Retrieved on 17th March 2017)
Shanghai is a developed city within China offering a host of business opportunity along with
rising tourists spots (Hassan 2012). It is known to attract foreign regular tourists as well as
business purpose visitors throughout the year that further helps splurge demand for food and
other products offered by Timbre.
5.1 Customer Profile and Demand Analysis
Markets in China have been booming in recent times with capability of its product penetrating
world markets. Shanghai’s GDP has been increasing by 7.0% every year with Rmb 2,366.1
billion reaching in 2014 alone. It shares a proportion of 3.7% of the GDP from the entire country.
Shanghai has been topping the chart in fixed asset investments, export and import values, total
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retail sales related to consumable goods and utilizing foreign investments. The city’s
consumption pattern has been driving growth in neighboring areas as well.
Figure 2: Shanghai's GDP
Source: (HKTDC Retrieved on 17th March 2017)
Shanghai’s domestic consumption pattern has changed greatly in the recent years with immense
influx of foreigners in the country. Consumers with increasing disposable incomes are inclined to
purchase good and quality food as well as music that comes at good offering. Chinese consumers
have been growing tendencies towards Westernized lifestyles with inclination Chinese
companies.
Moreover, robust population of China, especially in Shanghai makes it more promising for
businesses as Timbre to flourish in the region. Product offerings of Timbre are comparable to
current changing lifestyle and behaviour of the young generation within the city. Demand
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patterns of young generation including office goers greatly match to the services that are offered
by the Company, hence there is a great scope of success for the business.
5.2 Geographic Segmentation
Shanghai is a vast city that has been divided into northern, southern, western and eastern parts.
Profiles of commercial districts within the city includes Nanjing West Road, Nanjing East Road,
Sichuan North Road, Xujiahui, Zhonghuan (Zhenbei), Huaihai Middle Road, Xiao Lujiazui -
Zhangyang Road, Yuyuan Tourist Mart,Wujiaochang, International Tourism and Resorts Zone,
Zhongshan Park, Hongqiao Business District, and New Hongqiao – Tianshan. Daning and
Zhenyu. Amongst all these commercial localities Nanjing Ear Road is regarded as China’s No. 1
Shopping Street. Most of the popular international brands as well as well-known hoteliers are
based across these localities. These places have integrated consumer area that caters to
diversified consumer needs of entertainment, business, fashion, shopping, dining and other
experiences. Shanghai area is bound to offer the business with immense potential for growth and
expansion related to the business.
5.3 Demographic Segmentation
Shanghai has a robust population of 24.26 million as per 2014 which was depicted to increase by
36% from 2005 when it was at 17.78 million. Amongst the population share 41% accounted for
Shanghai’s permanent population with the rest being population which was primarily out-of-
province. Though during recent times, there has been a dip in Shanghai’s population across its 17
districts, but it has been noted that most of the population went on to suburb
(worldpopulationreview.com Retrieved on 17th March 2018). Population consisted of male
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being 52% share of the total, rest being female. The best part of the demographics in Shanghai is
that majority consist of young age population, with less than 10% population being aged 65 years
or more. Education level of permanent population in Shanghai were only 22% university level,
21% having senior school education with rest being junior or primary school education levels.
Population within Shanghai comprises of residents, workers, entrepreneurs, business travellers
and tourists from overseas location. With high levels of variety within consumer occupation,
habits an income levels consumption needs also vary. High amounts of disposable income
amongst city residents and increasing number of young population makes price not the main
consideration for consumption rather enjoyment and development. Narrowing trend amongst
eastern Chinese population and westernized culture has been seen to be narrowing which makes
mainstream consumers attracted to varied food, entertainment and music.
5.4 Psychographic Segmentation
Timbre had been responsible for changing behavioral patterns amongst consumers, as earlier
they used to have traditional Mandarin-English live music changing to live jazz-blues music.
Their focus is to keep innovating and surprising their customers on their service and product
offerings, which helps them to attract consumers (Times Retrieved on 17th March 2018).
Detailed segmentation of Shanghai’s consumer profile reveals diversified types of consumers
with increasing purchasing power. Individual demand from high-end consumers are greatly
enhancing which makes service quality and brand names being integral part of service
disposition. Shanghai has been offering a destination for international brands and choices from
where a consumer can select from. Therefore, quality oriented brands have high likeliness and
possibility to establish their businesses there.
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Works Cited
Hassan, S. S., & Craft, S. "Examining world market segmentation and brand positioning
strategies. ." Journal of Consumer marketing, 2012: 344-356.
HKTDC. "Shanghai: Profile of a Consumer Market."
http://china-trade-research.hktdc.com/business-news/article/China-Consumer-Market/
Shanghai-Profile-of-a-Consumer-Market/ccm/en/1/1X000000/1X0A3FYT.htm, Retrieved
on 17th March 2017.
Sharma, A., & Lambert, D. M. "Segmentation of markets based on customer service. ."
International Journal of Physical Distribution & Logistics Management., 2013.
Times, The Straits. "The Life Interview with Timbre Group's Edward Chia: Changing
Singaporeans, one tray at a time."
http://www.straitstimes.com/lifestyle/entertainment/the-life-interview-with-timbre-
groups-edward-chia-changing-singaporeans-one, Retrieved on 17th March 2018.
worldpopulationreview.com. "World Population Review."
http://worldpopulationreview.com/world-cities/shanghai-population/, Retrieved on 17th
March 2018.
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