Segmentation

Segmentation allows selling companies to create an enhanced and specified target market. The companies set themselves in a position to reach genuine clientele so that they can have quality sales. Specifically, in chapter 4 in Godin he discusses “the smallest viable market.” How there needs to be a segmentation to target the most likely consumer. When reading about the CEO of JC Penny, he decided to change the JC Penny business model and transition from constant sales, coupons and promotions and shift to lower the cost of items. This resulting in a 50% decrease in sales. Now one would ask, why? but, the reason is simple. There is a specific market of buyers that will only buy products on premotion or sale. That is the segment of JC penny. There particular viable market is consumers who look to “get a deal” when shopping, rather than purchasing low cost items.

Consumers believe they want choice, however too much choice does confuse the consumer. It is very important for the selling company to “force a focus (Godin) ” on the consumer otherwise it does not create direct personal and specific selling to the consumer. In the Kerin reading, they bring in the example of both men and women buying cars. When creating different segments to sell the both to men and women certain variables differ not based on needs, but rather based on outlook. Both may value speed, but the type of speed is dependent on the need. For men it is a 0–60 feature making them feel powerful, whereas with women they want consistent speed. For a car company to give both limited options it will give them more overall buyers. The reason for this would be because men statistically are only looking for certain specific features and so are women. By given them each limited option in what they are looking for it will allow them to make concisions and decisive decisions.