When a market is effectively segmented, less resources are put in place hence culminating into profitability to the firms. For Market Segmentation to be effective, the following conditions are necessary.
The market segment must be;
The size and buying power of the segment should be measurable. This will enable the marketer to assess the amount of products to produce and how to price them.
It should be large enough to generate sales volume that ensures sustainability. A small segment can also be profitable if it has a substantial buying power.
Marketing managers should be able to communicate effectively with different segments using various advertising media.
The segment should be distinguishable and should respond differently to different marketing mix element and products.
The marketing manager should be able to formulate attractive programs to attract and serve the segments. A market should be actionable if it is large in size or it is profitable.
Benefits of Market Segmentation
- Marketers are able to assess effectively their competitive strengths and weaknesses.
- Marketers can avoid fierce competition by putting resources in areas not penetrated by their rivals.
- The target market identification can help marketer design products that really match the market needs and wants.
- Marketers can formulate promotion messages geared to specific target market.
- Helps in determination of the most effective channel of distribution that can ensure a specific target market is served effectively.