TEAM BLUE

Activity 1
Choosing a Market

Instituto Politécnico Nacional

Escuela Superior de Comercio y Administración Unidad Santo
Tomas

Licenciatura de Negocios Internacionales

Mercadotecnia y Promoción Internacional

Unit 1
Market Situation Analysis
Activity 1 Choosing a Market

Asesora: Erika Marcela Tapia Valdez

Team:
Ortega Paulín Kali Valeria
León Ponce Rosa Amalia
Leon Rodríguez Ana Karen
Villaseñor Gómez Angel Eduardo

Group: 3NX35
INTRODUCTION

Businesses need to grasp the concept of market segmentation fully. After all, market
segmentation is the key to unlocking a business’s potential customer base. By
understanding market segmentation, businesses can better allocate their resources
and focus their efforts on reaching their target audience.
An example of this would be if a clothing company were to market its products to two
different types of consumers: one willing to spend more money on clothing and another
looking for cheaper options.
Market segmentation is a marketing phrase that refers to businesses’ division of the
market. Under market segmentation, a firm divides various needs based on criteria
such as age, pay, geographical location, weather, culture, etc.
What is Market Segmentation?

It is a crucial component of any marketing strategy since it allows you to understand

your customers’ purchasing patterns. Segmenting your market might help determine
what personal, cultural, economic, or social variables may influence clients’
interactions with your products and services.

Segmentation is the process of categorizing a specific audience into subgroups based

on shared characteristics, ranging from age to gender to location to interests and
behaviors.

You’ll be able to market to your audience cost-effectively if you categorize them into
niches rather than concentrating your efforts on an individual or broad scale.

Segmenting your clients will give you a superior understanding of their desires and
requirements. It demonstrates how specific customers are more likely to look for or
buy a product, as is not every client.

How to do Market Segmentation

There are a few different ways that businesses can segment their markets. The most
common methods are geographic location, demographics, psychographics, and
benefit. The following are the steps to take to initiate market segmentation in a
business:

1. Determine the target market – The first step is identifying the target market. It is
done by brainstorming or using market research.

2. Determine the target audience’s expectations – Once the target market has been
identified, businesses need to determine what this market segment wants and needs.
It is done by conducting focus groups or surveys.

3. Make Subgroups – Businesses need to make subgroups after the target market’s
expectations have been determined.

4. Examine the target audience’s requirements – The final step is to examine the
conditions of each subgroup. It is done by conducting more focus groups or surveys.

5. Identify your market segment – Next, businesses should have a good idea of their
target market segments. They can then identify the segment they want to focus on.
6. Create appropriate tactics – Businesses can create marketing tactics tailored to this
group after identifying the target market segment. It includes creating ads, developing
new products, or offering discounts.

7. Examine the conduct – Next, businesses should monitor the results of their market
segmentation efforts. It is done by examining sales figures or customer surveys.

8. Target Market Size – Businesses should be prepared to change their strategy if they
do not see the desired results. It includes changing the target market segment or the
marketing tactics used.

Types of market segment

● Single segment marketing: it capitalizes on a single type of market that has not
been explored by other companies and can increase revenues quickly.
● Multi-segment marketing: companies employing this type of segment can cover
revenues from other market areas with other products sold in another market
area.
● Price-sensitive segment: this type of consumer prefers to buy products in the
market at low prices.
● Profit-sensitive segment: this type of consumer looks for quality in the product
rather than price as the other consumers mentioned above.

Market groups

● Market segment: it must comply with certain characteristics so that the

company can sell the products it is going to incorporate to the market and which
type of consumer is going to be its main target.
● Market niche: it is a type of consumer selected by the company.
● Market cell: this type of consumer is very small, and it is better because its type
of consumption can grow in the future due to the popularity that can be given
to it.

There are 4 main types of segmentation:

● Demographic: This demographic segmentation refers to the division of the

market considering aspects such as age, sex, religion, marital status,
educational level, etc… It is the most Basic form of segmentation.
Advantages:
• The information is relatively accessible and low cost.
• Some products are specifically targeted at one demographic, for
example, grooming products: men's razors and women's razors.
 Disadvantages:
• They often must be used in conjunction with other types of
segmentation to complement each other.
• It's a basic segmentation, so it does not work with very specific niche
products.

GEOGRAPHICAL: Geographic segmentation is grouping customers by where they

live, they can be people who live in the same country, the same city, the same region,
etc.

Advantages:

• Some of the advantages of this type of segmentation is that they can help the
sale of products that serve to cover a specific need in the region, such as winter
clothing in a cold region, beach clothing in coast zones, sports or activities that
are popular in certain areas such as cricket which is popular in India, but soccer
is more popular in Latin America.
• It is a type of segmentation that requires information which can be public since
the study of the geography of the regions by the government is quite common.

Disadvantages:

• It is a type of segmentation that is quite general (it does not delve into behavioral
or psychological factors of the users)
• It does not work for all products, there are some for which it is not enough to
know the geographical conditions of the people, it is also necessary to know
their specific needs.
• It often must be complemented by another type of segmentation since it does
not work for very narrow or specific niches.
• It does not work for all products, there are some where it is not enough to know
the geographical conditions of the people.

PYSICOGRAPHY: Psychographic segmentation refers to the potential customer's

personality, lifestyle, values, attitudes, interests, preferences, and similar
psychological characteristics.

Advantages:

• It is one of the most valuable segmentations due to the degree of depth it

entails.
• This segmentation is useful to gain a deep insight into the needs, wants and
dislikes of customers.
Disadvantages:

• As these are subjective qualities, this segment is more difficult to identify.

• Not very useful when selling non-specialized products or services.

BEHAVIORAL

This type of segmentation is based on customer behavior and actions.

Advantages:

• Since this segmentation is based on user behaviors, it is useful for products

that are similar to others that already have a market segment in which they are
sold.
• It is useful for taking actions based on customer behavior patterns.
• It can help a lot to improve the profitability of already established products.

Disadvantages:

• Behavior patterns cannot be used with a segment that has not been sufficiently
explored before.
• Information is not as easy to obtain as in other types of segmentation.

Bibliography

Aulapolivirtual - Nivel Superior y Posgrado: Ingresar al sitio. (s/f). Ipn.mx Recuperado

el 9 de enero de 2024, de
https://www.nsyp.aulapolivirtual.ipn.mx/mod/assign/view.php?id=18055

Quiroa, M. (2020, febrero 7). Segmento de mercado. Economipedia.

https://economipedia.com/definiciones/segmento-de-mercado.html