Market Segmentation
Market Segmentation involves dividing potential customers into different groups. The various groups are based on the characteristics of the consumers (Andaleeb, 2016). Customers with similar characteristics, such as needs, traits, and locations, are placed on the same group because they have the same reaction to market strategies. This paper will discuss market segmentation and its importance to Raleigh Wheels company.
Market segmentation is essential for bicycle producers because it enables the company to design different styles of bicycles to satisfy every customer’s needs. Since the customers’ tastes and preferences are different, market segmentation ensures that each one of them gets their desired design. Market segmentation helps Raleigh company to identify the customers who use the bicycles for messenger purposes and also those who casually enjoy riding bikes. This knowledge makes the bicycle company target those consumers by making them bicycles according to their preferred needs hence making them earn more income and satisfying their customer’s wants.
Raleigh wheel’s market segmentation is based on the different tastes of the customers and the intended use for those bicycles. One of the segments is companies that need bikes for transport. Therefore, their bicycles should have features for easy transportation. Another segment is the customers who need bicycles for entertainment purposes as they enjoy riding. Descriptive statistics are used to describe the essential elements of a given data. They provide summaries about the sample. In Raleigh company, the company that used the bicycles to deliver documents and packages is used to summarize the other consumers who use the bike for transport services.
The new segment refers to one of the groups, while an attractive segment means one which shows large current or long-term profit potentials (Venter, 2015). According to Raleigh’s research, the people who enjoy riding bicycles as a lifestyle are the ones who make attractive segments. This is because, during demonstration fleets, they discover that the Raleigh bicycles are not as heavy as they expect steel to be. Through social media also, they get information about the features of the current and future bikes. This provides current and long term profit as the customers switch to their bikes. The market segment that Raleigh is pursuing is of great importance since they get to know the features their customers would like to have in their bikes. This will help the company produce such bikes; hence they will be able to increase their profits and satisfy their consumers.