1) Segmentation determines whether a market exists & is accessible
2) It determines the controllable variables comprising the marketing mix:
Promotion (Advertising, Personal Selling)
Bad on that versus brand a + b what am I good at?
o Switch the orientation that might work for you
o Don’t throw in the towel
London Metals Exchange
o They have to be the same quality in order to sell
o If the quality is the same, then you compete on Price
If not on Price, maybe on Technology
Diversify in roder to reduce your risk
o Horizontal integration
o Don’t’ put everything in one sector (Pulp and paper)
Do Pulp + Paper Plastics, Oil refinery, etc
Consumers and Organizational Buyer Behaviour
Don’t fall into the trap of supply side definitions for market segments based
on the company’s definition
Ie. Products “A” and “B” are similar, so they serve the same market
and act as substitutes for each other.
Go for a demand oriented approach. This is based on the customers’
definition of the products and their usage.
Consider two customer oriented approaches for identifying product markets.
1) Purchase or Usage Behaviour
Provides a good indication of what purchasers do or have done with
regard to (WRT) with product and its marketing
*Note: In B2B, make sure you visit customers to see how they use
o Can be frightening if they aren’t using it as intended b/c that
means your market could be dying, or it is a new market to
go into *Note: This is one of the biggest things to take a look at. Don’t be
fooled by the primary use!
A) Cross Price Elasticity of Demand (CPE of D)
The price sensitivity of one brand WRT to changes in the prices of
o E.g. What happens to the sales of brand “A” as decreases
occur in the prices (or other marketing mix expenditures) of