Segmentation In Dynamic Markets

Dr. S Ramesh Kumar

Professor of Marketing, Institute of Management, Bangalore
Usefulness of analysing timestyles
Another advantage of an in-depth analysis of discretionary time with a database is to target
segments based on the intensity of interest in a specific activity/service/product. Most of the
marketing communication today on products/services aiming at the discretionary time of
consumers is broadly projected in newspapers or television commercials. Hence they are likely to
reach people who may have a low level of interest in the product/service advertised or they are
likely to be noticed by consumers who are interested in leisure category (in general) and hence
are likely to compete with different categories, which belong to the leisure market. Research on
the intensity of interest can enable marketers to reach out to a focused target segment through
specific media. This would result in higher percentage of consumers buying the product or
service. A premium hill resort package for example could be advertised on a niche channel like
Discovery or National Geographic, as it is likely to make an impact on the target segment, which
is interested in Nature.
A response-generating direct marketing advertisement in a popular newspaper among a target
segment could follow this up. A brand of mobile phone could have different price slabs for
discretionary time to encourage users to connect with friends or relatives (the operational aspects
could be worked out based on the offer).
Another advantage of an in-depth analysis of discretionary time with a database, is to
target segments based on the intensity of interest in a specific activity/service/product
Strengths of the company
While reaching out to different segments a company has to also take into consideration its own
strengths. In the moulded-luggage market, around fifty per cent of the market is in the
unorganised sector and VIP has a very strong distribution network of around 12,000 outlets. A
company like Samsonite (a global brand) has to build up a distribution network in India though it
could draw from a range of about 2000 items of its international product range. Hence Samsonite
is currently operating at the higher end of the moulded- luggage market.
Tiger from Britannia has been a major success at the lower end of the biscuit market as a large
percentage of the market lies at the lower end and the company has a very strong distribution
network, which would back up the positioning of the brand. Leading pen brands like Reynolds,
Parker and Luxor are launching offerings at the higher end of the market taking into consideration
profitability aspects and the intense price competition at the lower end of the market (below Rs l0
a pen). Even a company like Hindustan Lever was able to counter the lower-end brand Nirma
only after a few years (after the launch of Nirma). It launched Wheel as a brand for the lower end
of the detergent market.
E-segments
Digital economy has brought in another topical segment. The E-segment is one aspect that most
companies consider in todays context. As a distribution alternative, it is likely to complement the
channel structure of a company in an environment that is undergoing radical changes. Avon, the
global brand in cosmetics, which operates in around 135 countries, has been using direct
personal selling for several decades (calling on the lady of the house). In several markets,
because of environmental changes (double income households and concern of safety), it is today
using the Internet to reach out to one cross-section of its segment. Brands could use e-commerce
to reach consumers if the transaction involves a high degree of interaction between the company
and the consumer. Cosmetics, travel and hotel services are certain categories where ecommerce is likely to be useful to reach one cross-section of the target segment. Another aspect,
which may be of interest to brands, is that any e-commerce should be targeted with the long-term
orientation the brand should plan to cultivate the loyalty of the e-segment over a period of time.
A small niche base of consumers may become loyal consumers in the category of jewellery if the
e-store is able to provide designs and services that would win the interest and trust of the

consumers.
Value orientation and meaningful positioning
Good product ideas can create segments and help the pioneering firm to develop top- of-themind awareness in the respective product category. Good product ideas could include value in
terms of customer perception and features, which could lead to convenience and ease of usage.
A brand of detergent suggesting a complex way of usage may not appeal to consumers in spite of
product improvements. Shampoos in sachets (apart from enlarging the market significantly) have
opened up a new segment (travelers) because of convenience. In todays context of convergence
of technologies, there is a distinctive need to analyse the benefits/needs of target segments. The
three-in-ones of yesteryear (which offered radio, tape recorder and record player in one device)
and the watch-TV combination have been non-starters.
The communication refrigerator (by which one could use the refrigerator to access the Web) and
applications of blue-tooth technologies (by which several devices at home could be operated
through mobile devices) sound interesting but marketers have to be clear about drawing a
segmentation plan for novelty seekers (who could be innovators), and consumers look for
benefits from such convergence products. In non-durables, there may be specific positioning
slots, which may perhaps be vacant in the consumers mind, but these slots may not be
meaningful in terms of providing a differentiation in dynamic markets (which is going through
several variants and behavioural changes in the buying behavior). In the category of soaps, there
are a number of brands with variants and it is also a category where consumer loyalty is known to
be fickle. The positioning slot of family soap has to be clearly explained to the consumer if a
brand chooses it for its proposition. Protex (from Colgate) launched a few years back does not
seem to have made an impact on consumers and currently Godrej has launched a brand All
Care, based on the proposition. Crowning Glory (which has been re-launched recently) was
positioned as a soap for body and hair.
As there are a number of shampoo brands, which are already creating a clutter of propositions,
there has to be a highly differentiated proposition for a consumer to buy soap for both body and
hair especially at a price that is not in the economy range. Perhaps the brand could focus on
specific markets with a proposition of strong foam when used with hard water. But the brand
name has to be a new one for such a strategy (in this case) so that past association of the brand
is not counter-productive.
Segmentation, targeting and positioning (STP) are dynamic concepts, which could provide
valuable insights for marketers if used with planned research.