CHAPTER:I

INTRODUCTION

( MARKETING : MARKETING
SEGMENTATION AND TARGETING)
1.1INTRODUCTION OF MARKETING:-

Marketing refers to activities a company undertakes to promote the buying or

selling of a product or service. Marketing includes advertising, selling, and delivering products to
consumers or other businesses. Some marketing is done by affiliates on behalf of a company
Professionals who work in a corporation’s marketing and promotion departments seek to get the
attention of key potential audiences through advertising. Promotions are targeted to certain
audiences and may involve celebrity endorsements, catchy phrases or slogans, memorable
packaging or graphic designs and overall media exposure.

1.2MEANING OF MARKETING:-

Marketing is the activity, set of institutions, and processes for creating, communicating,
delivering, and exchanging offerings that have value for customers, clients, partners, and
society at large.

1.3 DEFINITION OF MARKETING:-

•The science and art of exploring, creating, and delivering value to satisfy the
needs of a target market at a profit.” ..Philip Kotler
•The aim of marketing is to know and understand the customer so well that the
product or service fits him and sells itself. … Ideally, marketing should result in a customer who
is ready to buy.”…Peter drucker

1.4 FEATURES OF MARKETING:-

•Needs and Wants: The main objective of marketing process is to satisfy the needs and
wants of the customers. All the marketing activities are carried out to fulfill this objective. A
need can be defined as sum total of all those items which are basic to human beings. For
example; food, shelter, clothing, water etc. Culturally defined objects that are potential satisfiers
of needs are known as Wants. For example, basic need for water can take many forms such as
cold drink or lemon water or tea or coffee etc. These forms are known as wants. An organisation
must identify the various needs of their customers and should develop products and services that
satisfy the same.
• Creating a Market Offering: Market offering means giving an offer for goods and
services by describing its features like shape, size, quality, uses etc. Suppose a computer is
offered in a market; its various features like different sizes and prices at which it is available,
technologies used, location of the shops at which it is available etc. are described. A good
‘market offer’ is one which aims at complete consumers’ satisfaction.
•Customer value: The customer is willing to purchase the product or services only when
its value is satisfying their needs, in relation to its cost i.e. the product or service is providing
them maximum benefit. Therefore, the marketer’s job is to add some value to its product so that
it is preferred by the customers over the competitors’ product.
•Exchange Mechanism: The process of marketing consists of exchange of goods and
services for money or money’s worth. This mechanism helps both buyers and sellers to get what
they desire. Exchange is defined as an essence of marketing. Products can be exchanged through
various middlemen at different levels of distribution.

1.5 IMPORTANCE OF MARKETING:

(1) Marketing Helps in Transfer, Exchange and Movement of Goods:-

 marketing is very helpful in transfer, exchange and movement of goods. Goods
and services are made available to customers through various intermediaries’ viz.,
wholesalers and retailers etc. Marketing is helpful to both producers and consumers. the
former, it tells about the specific needs and preferences of consumers and to the latter
about the products that manufacturers can offer. According to Prof. Haney Hansen
“Marketing involves the design of the products acceptable to the consumers and the
conduct of those activities which facilitate the transfer of ownership between seller and
buyer.

(2) Marketing Is Helpful In Raising And Maintaining The Standard Of Living Of The
Community:-Marketing is above all the giving of a standard of living to the community.
Paul Mazur states, “Marketing is the delivery of standard of living”. Professor Malcolm
McNair has further added that “Marketing is the creation and delivery of standard of
living to the society. By making available the uninterrupted supply of goods and services
to consumers at a reasonable price, marketing has played an important role in raising and
maintaining living standards of the community. Community comprises of three classes of
people i.e., rich, middle and poor. Everything which is used by these different classes
People is supplied by marketing. In the modern times, with the emergence of latest
marketing techniques even the poorer sections of society have attained a reasonable level
of living standard. This is basically due to large scale production and lesser prices of
commodities and services. Marketing has infact, revolutionised and modernised the living
standard of people in modern times.

(3) Marketing Creates Employment:-

Marketing is complex mechanism involving many people in one form or the other. The
major marketing functions are buying, selling, financing, transport, warehousing, risk
bearing and standardisation, etc. In each such function different activities are performed
by a large number of individuals and bodies. Thus, marketing gives employment to many
people. It is estimated that about 40% of total population is directly or indirectly
dependent upon marketing. In the modern era of large scale production and
industrialisation, role of marketing has widened. This enlarged role of marketing has
created many employment opportunities for people. Converse, Huegy and Mitchell have
rightly pointed out that “In order to have continuous production, there must be continuous
marketing, only then employment can be sustained and high level of business activity can
be continued.

(4) Marketing as a Source of Income and Revenue:-

The performance of marketing function is all important, because it is the only way
through which the concern could generate revenue or income and bring in profits.
Buskirk has pointed out that, “Any activity connected with obtaining income is a
 marketing action. It is all too easy for the accountant, engineer, etc., to operate under the
broad assumption that the Company will realise many dollars in total sales volume.
However, someone must actually go into the market place and obtain dollars from society
in order to sustain the activities of the company, because without these funds the
organisation will perish.” Marketing does provide many opportunities to earn profits in
the process of buying and selling the goods, by creating time, place and possession
utilities. This income and profit are reinvested in the concern, thereby earning more
profits in future. Marketing should be given the greatest importance, since the very
survival of the firm depends on the effectiveness of the marketing function.

(5) Marketing Acts as a Basis for Making Decisions:-

A businessman is confronted with many problems in the form of what, how, when, how
much and for whom to produce? In the past problems was less on account of local
markets. There was a direct link between producer and consumer .In modern times
marketing has become a very complex and tedious task. Marketing has emerged as new
specialised activity along with production. As a result, producers are depending largely
on the mechanism of marketing, to decide what to produce and sell. With the help of
marketing techniques a producer can regulate his production accordingly.

(6) Marketing Acts as a Source of New Ideas:-

The concept of marketing is a dynamic concept. It has changed altogether with the
passage of time. Such changes have far reaching effects on production and distribution.
With the rapid change in tas Definition of market segmentation tes and preference of
people, marketing has to come up with the same. Marketing as an instrument of
measurement, gives scope for understanding this new demand pattern and thereby
produce and make available the goods accordingly.

(7) Marketing Is Helpful In Development Of An Economy:-

Adam Smith has remarked that “nothing happens in our country until somebody sells
something”. Marketing is the kingpin that sets the economy revolving. The marketing
organisation, more scientifically organised, makes the economy strong and stable, the
lesser the stress on the marketing function, the weaker will be the economy.

1.6 SCOPE OF MARKETING:-

Marketing is a huge field but still, when we try to go into the depth we understand the
scope of marketing is very large. Following are scope for marketing which helps an
organization to focus on their growth & profit

1.Product design:
 Product design is the four most important elements in marketing the
communication needs & problems of the consumer have to be considered before marketing a
new product design.

2. Implementation of product:
Once the decision is finalized about the design of the product more focus should
be there on communication with the production department regarding the implementation of
product features.

3.Pricing of Product:
Pricing is the most important aspect of the product because it only decides the
major buying decision of the consumer. So if the product is very new to the market correct &
affordable pricing should be done.

4.Selection Of Layout:
The layout is the place where actually the product /services will be availed so
more focus should be done on the exact location and layout.

5.Publicity of the product:

Publicity means communication about the product and services for creating
awareness & demand for the product by publicity& Advertisement.

6.Distribution channel:
Distribution channel means the number of “intermediator like whole-sellers,
Retailers, distributors, Agent” who all are involved in the marketing channel.

7.Selling of Product:
Selling involves the actual challenge of marketing. The selling of products and
services involves different strategies like distribution through stores, salesmen, Advertisements,
Exhibitions, trade fairs, etc.

8.Collecting the feedback:

 This begins after the product is marketed and sold collecting feedback regarding
satisfaction or dissatisfaction related features like price, to make availability etc it is to make
changes in the marketing mix.

1.7LIMITATION OF MARKETING:

1. Effect of Extraneous Factors:

Extraneous means external and uncontrollable factors. In most of the cases,
the extraneous factors affect marketing research results adversely. Due to impact
of such factors, the net impact cannot be estimated. For example, if marketer
wants to study the impact of 10% price rise on demand and he raises price by
10%.As a result, demand falls by 20%. Here, decrease in demand cannot be fully
attributed to price hike only. Demand might have been affected by other factors
like introduction of new superior product, attractive offer of competitors,
availability of powerful substitutes, etc., over and above price rise. Whatever
 degree of precaution is taken, one cannot eliminate effect of such factors
completely, and as a result, marketing research cannot serve the purpose.

2. Time Gap Makes Research Irrelevant:

Systematic marketing research project needs more time. It takes weeks,
months, even years. When marketing research is carried on to investigate or solve the problem,
final outcomes are available after considerable time. When outcomes are made available,
situations might have been changed thoroughly or problem for which research was made might
have been solved automatically. Decision-maker needs information in time. But, practically, it is
not possible. Sometimes, time, money, and efforts contribute nothing.

3. Cost Consideration:
To conduct marketing research systematically is a luxury. A firm needs
money for research design, data collection, data analysis, interpretation, and
report preparation. Statisticians and computer experts charge heavy fees. When
research is conducted regularly, a company has to maintain a separate well-
equipped marketing research department. Marketing research has become costlier.
So, it is difficult for medium and small companies to afford.

4. Problem of Rapid Change:

Today’s market is characterized by tremendous changes. Whatever is
applicable or relevant today is out-dated tomorrow. Due to rapid changes,
marketing research cannot serve the purpose. Research results or outcomes
available after the specific time period seem irrelevant or meaningless.

5. Problem of Trust and Accuracy:

Marketing research is based on trust and accuracy. Right from the
identification of problem to the final outcomes, all depends on trust. Company has
to trust on marketing research officer; research officer has to trust on field officer;
and field officer has to rely on response of respondents. At any stage of marketing
research, accuracy is vital issue. To the extent inaccuracy prevails, marketing
research results suffer.

6. It is not Problem Solving Technique but an Aid to Solve the

Problem:
 It is interesting and shocking to state that marketing research does not
solve any problem directly. It is not a problem-solving technique but can assist to
solve it. It is not a magic stick to solve marketing problems; it is a source of
information. To the extent source is reliable and is used properly, it is useful.
Even, an excellent research project is useless if outcomes are not considered.

7. Subjective or Biased Result:

When human being is involved, a completely bias-free response or
result is not possible. Effect of personal value, prejudice, attitudes, needs, and
other socio-cultural factors affect the objectivity of research adversely.
Subjectivity may lead to utter chaos.

8. It cannot Eliminate Risks Inherent in Decision-making:

In every economic decisions, there exists risk and uncertainly.
Marketing research cannot eliminate risk and uncertainty. It is an attempt to
minimize degree of risk. So, heavy costs on marketing research don’t guarantee
safety and certainty.

9. Applicability or Use:
Contribution of research project depends not only on quality and
reliability alone, but also the proper use of information. Many times, marketing
research reports remain just a formality for top management. Recommendations
are neither considered seriously nor implemented fully.

10. Difference between Filed Officers, Data Analysts, and Decision-

makers:
Marketing research activity involves a number of people such as
marketing manager, field officer, data analysts, and finally decision-maker. All
these people have different objectives, backgrounds, and perspectives.
Consistency or parity among them is a vital issue. Unless high degree of
integration and intimacy among them exit, one cannot expect a success. In fact, it
is difficult.Marketing manager and those involved in marketing research activity
must be aware of these limitations/practical problems. Note that these limiting
factors cannot be completely eradicated. Attempts should be made to minimize
adverse impact of these limiting factors. Careful plan, adequate budget,
teamwork, accuracy, timeliness, proper use and implementation, etc., have a
strong prospect to contribute in successful marketing research.

1.8OBJECTIVE OF MARKETING:-
Marketing majorly focuses on achieving consume and maximising profits.

• Customer Satisfaction:
 The Primary motive of a company is to satisfy the needs of customers.

• Ensure Profitability:
Every business is run for profit, and so goes for marketing.

• Building Organizational Goodwill:

It portrays the product and the company’s positive image in front of the
customers.

• Create Demand:

It works for generating the demand for products and services among the
customers.

• Increase Sales Volume:

It is a rigorous process of increasing the sale of product or service to generate
revenue.

•Enhance Product Quality:

Marketing initiates customer feedback and reviews to implement them for product
enhancement.

• Create Time and Place Utility:

It makes sure that the product or service is available to the consumer whenever
and wherever they need it.
MARKETING SEGMENTATION
2.1 MARKET SEGMENT:
A market segment is a group of individuals, groups or organisations who may share
the same Interests, traits and characteristics. The consumer segments may have similar needs, wants
and Expectations. Therefore, businesses should ask themselves which segments should they serve? To
answer this question, the businesses must determine the most appropriate ways to Distinguish and to
differentiate their segments. Once the segments have been identified they Must customise their
offerings to satisfy each and every one of them.

2.2 MARKET SEGMENTATION:

Market segmentation is the actual process of identifying segments of the market and the
process Of dividing a broad customer base into sub-groups of consumers consisting of existing and
Prospective customers. Market segmentation is a consumer-oriented process and can be applied To
almost any type of market. In dividing or segmenting markets, researchers typically look for Shared
characteristics such as common needs, common interests, similar lifestyles or even Similar demographic
profiles. So, market segmentation assumes that different segments require Different marketing
programmes, as diverse customers are usually targeted through different Offers, prices, promotions,
distributions or some combination of marketing variables.

2.3 BENEFITS OF MARKET SEGMENTATION:

1. Stronger marketing messages:
 You no longer have to be generic and vague – you can speak directly to a specific
group of people in ways they can relate to, because you understand their characteristics, wants,
and needs.

2. Targeted digital advertising:

Market segmentation helps you understand and define your audience’s
characteristics, so you can direct your marketing efforts to specific ages, locations, buying habits,
interests etc.

3. Developing effective marketing strategies:

Knowing your target audience gives you a head start about what methods,
tactics and solutions they will be most responsive to.

4. Better response rates and lower acquisition costs:

These will result from creating your marketing communications both in ad
messaging and advanced targeting on digital platforms like Facebook and Google using your
segmentation.

5. Attractive the right customers:

Marketing segmentation helps you create targeted, clear and direct messaging
that attracts the people you want to buy from you.

6. Increasing brand loyalty:

when customers feel understood, uniquely well served and trusting, they are
more likely to stick with your brand.

7. Differentiating your brand from the competition:

More specific, personal messaging makes your brand stand out.

8. Identifying niche markets:

segmentation can uncover not only underserved markets, but also new ways of
serving existing markets – opportunities which can be used to grow your brand.

9. Staying on message:
As segmentation is so linear, it’s easy to stay on track with your marketing
strategies, and not get distracted into less effective areas.

10 Driving growth:

You can encourage customers to buy from you again, or trade up from a lower-
priced product or service.
 11 Enhanced profits:
Different customers have different disposable incomes; prices can be set
according to how much they are willing to spend. Knowing this can ensure you don’t over (or
under) sell yourself.

12 Product development:
You’ll be able to design with the needs of your customers top of mind, and
develop different products that cater to your different customer base areas.

2.4 TYPES OF MARKET SEGMENTATION:

• Demographic segmentation : Demographic segmentation sorts a market by

elements such as age, education, income, family size, race, gender, occupation, and nationality.
Demographic is one of the simplest and most commonly used forms of segmentation because the
products and services we buy, how we use those products, and how much we are willing to
spend on them is most often based on demographic factors.

• Geographic segmentation: Geographic segmentation can be a subset of

demographic segmentation, although it can also be a type of segmentation in its own right. It
creates different target customer groups based on geographical boundaries. Because potential
customers have needs, preferences, and interests that differ according to their geographies,
understanding the climates and geographic regions of customer groups can help determine where
to sell and advertise, as well as where to expand your business.

• Firmographic Segmentation: Firmographic Segmentation is similar to

demographic segmentation, except that demographics look at individuals while firmographics
look at organisations. Firmographic segmentation would consider things like company size,
number of employees and would illustrate how addressing a small business would differ from
addressing an enterprise corporation.

• Behavioural Segmentation: Behavioural Segmentation divides markets by

behaviours and decision-making patterns such as purchase, consumption, lifestyle, and usage.
For instance, younger buyers may tend to purchase bottled body wash, while older consumer
groups may lean towards soap bars. Segmenting markets based on purchase behaviours enables
marketers to develop a more targeted approach because you can focus on what you know they,
and are therefore more likely to buy.
 • Psychographic Segmentation: Psychographic segmentation considers the
psychological aspects of consumer behaviour by dividing markets according to lifestyle,
personality traits, values, opinions, and interests of consumers. Large markets like the fitness
market use psychographic segmentation when they sort their customers into categories of people
who care about healthy living and exercise.

2.5 Requirements for Effective Segmentation:-

Identifying the requirements for effective market segmentation allows companies to create
marketing campaigns that are essential for their growth and development. Here are the five
criteria for effective market segmentation:

1. Measurable:
The size and purchasing power profiles of your market should be measurable, meaning
there is quantifiable data available about it. A consumer’s profiles and data provides
marketing strategists with the necessary information on how to carry out their campaigns.
It would be difficult to create advertisements for markets that have little to no data or for
audiences that can’t be measured. Always ask whether there is a market for the kind of
product or service that your business wants to produce then define how many possible
customers and consumers are in that market.

2. Accessible:
Accessibility means that customers and consumers are easily reached at an affordable
cost. This helps determine how certain ads can reach different target markets and how to
make ads more profitable. A good question to ask is whether it’s more practical to place
ads online, on print, or out of house. For example, gather data on the websites a specific
target market usually visits so you can place more advertisements on those websites
instead.

3. Substantial:
The market a brand should want to penetrate should be a substantial number. You
should clearly define a consumer’s profiles by gathering data on their age, gender, job,
socio-economic status, and purchasing power. It doesn’t make sense to try and reach an
unjustifiable number of people — you’re just wasting resources. However, you also don’t
want to market the brand to a group too small that the business doesn’t become profitable.

4. Differentiable:
When segmenting the market, you should make sure that different target markets
respond differently to different marketing strategies. If a business is only targeting one
segment, then this might not be as much of an issue. But for example, if your target
market is college students, then it’s essential to create a marketing strategy that both
 freshman students and senior students react to in the same positive way. This process
ensures that you are creating strategies that are more efficient and cost-effective.

5. Actionable:
Lastly, your market segments need to be actionable, meaning that they have practical
value. A market segment should be able to respond to a certain marketing strategy or
program and have outcomes that are easily quantifiable. As a business owner, it’s
important to identify what kind of marketing strategies work for a certain segment. Once
those strategies have been identified, ask yourself if the business is capable of carrying out
that strategy.

2.6 Market Segmentation strategy:

Why should market segmentation be considered a strategy? A strategy is a considered plan

that takes you from point A to point B in an effective and useful way. Market segmentation is
similar, as there will be times you need to revisit your market segments, such as:
In times of rapid change: A great example is how the Covid-19 pandemic forced a lot of
businesses to rethink how they sell to customers. Businesses with physical stores looked at
online ordering, while restaurant owners considered curbside pickups.If your customers change,
then your market segmentation should as well, so you can understand clearly what your new
customers need and want from you.
On a yearly basis: Market segments can change year on year as customers are affected by
external factors that could alter their behaviour and responses.For example, natural disasters
caused by global warming may impact whether a family chooses to stay living in an area prone
to more of these events. On a larger scale, if your target customer segment moves away from one
of your sales regions, you may want to consider re-focussing your sales activities in more
populated areas.
At periodic times during the year: If you’ve explored your market and created market
segments in the Spring, the same market segments may have different characteristics at a
different time of the year.For example, Winter has several holidays, with Christmas being a huge
influence on families. This holiday impacts your market segments’ buying habits, how they’ll
behave (spending more than normal at this time than any other) and where they will travel too
(back home for the holidays). Knowing this information can help you predict and prepare for this
period.
When considering updating your market segmentation strategy, consider these three areas:
Acknowledge what has changed: Find out what has happened between one time period to
another, and what have been the driving forces for that change. By understanding the reasons
why your market is different, you can make key decisions on whether you want to change your
approach or stay the course.
Don’t wait to start planning: Businesses are always adapting to long-term trends, so refreshing
market segmentation research puts you in a proactive place to tackle these changes head-on.
When you have your market segments, a good idea is to consider the long-term complications or
risks associated with each segment, and forward-plan some time to discuss problem-solving if
those issues arise.
Go from what to why: Why did those driving forces come about? Why are there risks with your
target market? At Qualtrics, we partner with companies to understand the different aspects of the
target markets that drive or slow success. You’ll have the internal data to understand what’s
happening; we help unleash insight into why with advanced modelling techniques. This helps
you get smart market segmentation that is predictive and actionable, making it easier for future
research and long-term segment reporting.

MARKET TARGETING
 3.1 MEANING OF MARKET TARGETING:
A target market is a group of customers within a business’s serviceable available
market at which a business aims its marketing efforts and resources. A target market is a subset
of the total market for a product or service. Targeting in marketing involves breaking the target
audience into segments and then designing marketing activities that will reach the segments most
likely to be responsive to your efforts. … Targeting in marketing generally refers to a three-step
process marketers use to find the right segment to target.
Once the market segmentation has been completed, the company should be aware of
the needs And wants of its selected segments. It is in the interest of the business to identify any
untapped Needs in the marketplace, as there could be customers who may not be adequately
served by Competitors. It is then necessary to identify the most profitable segments and to decide
which Segments will be served. There are three market coverage alternatives which can be
applied; Undifferentiated marketing; differentiated marketing and concentrated marketing.

• An Undifferentiated Marketing Strategy :

An undifferentiated marketing strategy ignores any differences in the market. Therefore,

this Strategy involves approaching the customers with one market offer. In this day and age,
Discerned customers are increasingly becoming more demanding. It will prove difficult for the
Business to develop a product or a brand which will satisfy all consumers who may have
Different needs, wants and expectations.
 • A Differentiated Marketing Strategy:
A differentiated marketing strategy will usually involve targeting a number of segments.
This Marketing coverage strategy entails developing an individual product or service offering,
and Creating a marketing plan for each and every segment. Hence, the company should carry out
a Thorough market research to learn about how it can satisfy its selected segments. This will
Translate to more costs than an undifferentiated strategy. Therefore, it is extremely important For
the company to decide which services are of critical importance to its chosen segments. The
Marketing managers should determine whether there will be significant margins when opting for
differentiated marketing.

• Concentrated marketing:
The companies with limited resources will usually target just one or a few sub-markets. If
a Segment is successfully chosen, there is a possibility that the firm may earn a high rate of
return On its investment. However, this form of marketing could also involve a high-risk factor.
If the Selected segment fails, the company can experience hefty losses.
In sum, the appropriate market coverage strategy may be determined by a number of factors:
• The company’s resources. If the resources are limited, concentrated marketing Could be
the most logical choice;
• The type of service which is to be offered.
• Diversities within the market. The companies need to understand their Customers’
requirements
• The competitors’ market coverage strategies. For example, if competing airlines Are
successfully applying segmentation techniques; probably, it would not make good
business sense to employ an undifferentiated marketing strategy.
Which segment should be selected? Businesses should only consider those market segments
That are profitable. Therefore, they should target profitable customers within those segments
And nurture a long-lasting relationship with them.

3.2 BENEFITS OF MARKETING TARGETING:

Effective market research will allow a business to find out the needs and wants of its
customers. This means that the product or service can be tailored to these needs, leading to
greater customer satisfaction. There are many benefits of doing this:
• Tailoring of products to meet the needs of particular groups of consumers. If a product
meets the needs of a consumer, sales will increase.
 • Sale of products in the most appropriate places to reach the chosen target audiences.
This can maximise sales.

• Pricing will be set to reflect what a target market will be willing to pay for a product
or service. This can maximise profits.

• Tailoring of marketing and promotion techniques to entice a company’s target market.

This will prevent money being wasted on ineffective marketing.

3.3 LIMITATIONS OF MARKET TARGETING:

• The Wrong target:

When you focus exclusively on a target market, you must be sure it works for
your product or service. When you choose one market segment, you exclude others.
The ones you exclude could offer you many sales, maybe even more sales, than the
one you chose. Remain aware of this potential disadvantage when you focus on a
target market, and be prepared to change your tactics if you find you need more sales.

• Small Market Share :

The target market you choose may not be large enough to support your business.
One characteristic of target markets – their well-defined, limited scope – can work
against you if that segment does not contain enough customers. Capturing 100 percent
of a small market can still leave you with low sales.

• Ethical Problems :
Some businesses receive criticism for targeting certain market segments. For
example, outlets who sell lottery tickets in disadvantaged neighborhoods can come
under fire for the appearance of taking advantage of desperate people with a promise
of riches that isn’t likely to come true. Similar problems could arise for a business
selling firearms in a notoriously violent neighborhood. Look at your target marketing
to make sure it will not engender potentially harmful publicity.

• Sharing a Market with Competitors:

Before selecting a target market, you should examine the competition in that
market. You may not be the first one to notice the advantages of a market segment. If
that segment is saturated with companies marketing to it, choosing that target market
could hinder your sales rather than help them. Look for target markets that can bear
additional marketing and support the kind of sales you need.
NEED FOR THE STUDY

• Market Segmentation helps the marketers to devise appropriate marketing strategies

and promotional schemes according to the tastes of the individuals of a particular
market segment. A male model would look out of place in an advertisement
promoting female products. The marketers must be able to relate their products to the
target segments.
• Market segmentation helps the marketers to understand the needs of the target
audience and adopt specific marketing plans accordingly. Organizations can adopt a
more focussed approach as a result of market segmentation.
• Market segmentation helps the organizations to target the right product to the right
customers at the right time. Geographical segmentation classifies consumers
according to their locations. A grocery store in colder states of the country would
stock coffee all through the year as compared to places which have defined winter and
summer seasons.
• Segmentation helps the organizations to know and understand their customers better.
Organizations can now reach a wider audience and promote their products more
effectively. It helps the organizations to concentrate their hard work on the target
audience and get suitable results.
• Organizations can use similar kind of strategies to promote their products within a
target market.
• They can adopt a more focussed approach in case of target marketing. They know
their customers well and thus can reach out to their target audience in the most
effective way.

OBJECTIVE OF THE STUDY

• Grouping of customers on the basis of their homogeneous characteristics, such as

nature, habits, income, behaviour qualities and needs etc.
• To located or identify the tastes, buying motives, needs, priorities and preferences of
the customers.
• To determine marketing strategies, targets, and goals.
• To make the activities of the firm customer oriented. Customer orientation Makes
marketing segment an important pillar of the Marketing concept.
 • To identify the areas or sectors where the customers may be created and the sphere
of the market is expanded.
• Increasing company awareness, leads or sales.
• increasing use of a coupon code

REVIEW OF LITERATURE:
• T.P. Beane (Philip Morris, USA)D.M. Ennis (Philip Morris, USA)European Journal of
Marketing ISSN: 0309-0566 Article publication date: 1 May 1987.
• Plummer, Joseph T.: ‘The concept and application of life style segmentation’, Journal
of Marketing (January 1974), pp. 33–7.
• Abell, Derek F.: Defining the Business: The Starting Point of Strategic Planning
(Englewood Cliffs, NJ, Prentice Hall, 1980).
• Blankson, Charles and Kalafatis, Stavros P.: ‘The development and validation of a
Scale measuring consumer/customer derived generic typology of positioning
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CHAPTER:II
COMPANY PROFILE
(Company profile : NIKE ✓)

Company Profile
NIKE
Nike, Inc. is an American multinational corporation that is engaged in the
design, development, manufacturing, and worldwide marketing and sales of
footwear, apparel, equipment, accessories, and services. The company is
headquartered near Beaverton, Oregon, in the Portland metropolitan area. It is
the world’s largest supplier of athletic shoes and apparel and a major manufacturer
of sports equipment, with revenue in excess of US$37.4 billion in its fiscal year
2020 (ending May 31, 2020). As of 2020, it employed 76,700 people worldwide.
In 2020 the brand alone was valued in excess of $32 billion, making it the most
valuable brand among sports businesses. Previously, in 2017, the Nike brand was
valued at $29.6 billion. Nike ranked 89th in the 2018 Fortune 500 list of the largest
United States corporations by total revenue.
Nike World Headquarters near Beaverton, Oregon
The company was founded on January 25, 1964, as “Blue Ribbon Sports”, by
Bill Bowerman and Phil Knight, and officially became Nike, Inc. on May 30,
1971. The company takes its name from Nike, the Greek goddess of victory. Nike
markets its products under its own brand, as well as Nike Golf, Nike Pro, Nike+,
Air Jordan, Nike Blazers, Air Force 1, Nike Dunk, Air Max, Foamposite, Nike
Skateboarding, Nike CR7, and subsidiaries including Jordan Brand and
Converse. Nike also owned Bauer Hockey from 1995 to 2008, and previously
owned Cole Haan, Umbro, and Hurley International. In addition to
manufacturing sportswear and equipment, the company operates retail stores under
the Niketown name. Nike sponsors many high-profile athletes and sports teams
around the world, with the highly recognized trademarks of “Just Do It” and the
Swoosh logo.

HISTORY :-
Nike, originally known as Blue Ribbon Sports (BRS), was founded by University
of Oregon track athlete Phil Knight and his coach, Bill Bowerman, on January 25,
1964. The company initially operated in Eugene, Oregon as a distributor for
Japanese shoe maker Onitsuka Tiger, making most sales at track meets out of
Knight’s automobile.
According to Otis Davis, a University of Oregon student-athlete coached by
Bowerman and Olympic gold medalist at the 1960 Summer Olympics, his coach
made the first pair of Nike shoes for him, contradicting a claim that they were
made for Phil Knight. According to Davis, “I told Tom Brokaw that I was the first.
I don’t care what all the billionaires say. Bill Bowerman made the first pair of
shoes for me. People don’t believe me. In fact, I didn’t like the way they felt on my
feet. There was no support and they were too tight. But I saw Bowerman made
them from the waffle iron, and they were mine”.
In its first year in business, BRS sold 1,300 pairs of Japanese running shoes
grossing $8,000. By 1965, sales had reached $20,000. In 1966, BRS opened its
first retail store at 3107 Pico Boulevard in Santa Monica, California. In 1967, due
to increasing sales, BRS expanded retail and distribution operations on the East
Coast, in Wellesley, Massachusetts.
By 1971, the relationship between BRS and Onitsuka Tiger came to an end. BRS
prepared to launch its own line of footwear, which was rebranded as Nike, and
would bear the Swoosh newly designed by Carolyn Davidson. The Swoosh was
first used by Nike on June 18, 1971, and was registered with the U.S. Patent and
Trademark Office on January 22, 1974.
In 1976, the company hired John Brown and Partners, based in Seattle, as its first
advertising agency. The following year, the agency created the first “brand ad” for
Nike, called “There is no finish line”, in which no Nike product was shown. By
1980, Nike had attained a 50% market share in the U.S. athletic shoe market, and
the company went public in December of that year.
Wieden+Kennedy, Nike’s primary ad agency, has worked with Nike to create
many print and television advertisements, and Wieden+Kennedy remains Nike’s
primary ad agency. It was agency co-founder Dan Wieden who coined the now-
famous slogan “Just Do It” for a 1988 Nike ad campaign,which was chosen by
Advertising Age as one of the top five ad slogans of the 20th century and enshrined
in the Smithsonian Institution. Walt Stack was featured in Nike’s first “Just Do It”
advertisement, which debuted on July 1, 1988. Wieden credits the inspiration for
the slogan to “Let’s do it”, the last words spoken by Gary Gilmore before he was
executed.
Throughout the 1980s, Nike expanded its product line to encompass many sports
and regions throughout the world. In 1990, Nike moved into its eight-building
World Headquarters campus in Beaverton, Oregon. The first Nike retail store,
dubbed Niketown, opened in downtown Portland in November of that year.
Phil Knight announced in mid-2015 that he would step down as chairman of Nike
in 2016. He officially stepped down from all duties with the company on June 30,
2016.
In a company public announcement on March 15, 2018, Nike CEO Mark Parker
said Trevor Edwards, a top Nike executive who was seen as a potential successor
to the chief executive, was relinquishing his position as Nike’s brand president and
would retire in August.
In October 2019, John Donahoe was announced as the next CEO, and succeeded
Parker on January 13, 2020. In November 2019, the company stopped selling
directly through Amazon, focusing more on direct relationships with customers.
On June 24, 2021, during an earnings call with investors, CEO John Donahoe
stated that “Nike is a brand that is of China and for China”, in response to a
question about competing against Chinese bran

Product profile
• SHOES:
Nike shoes provide excellent support. Nike shoes comes with a
herringbone pattern and a solid rubber, which adds to the comfort and
support of users. Nike shoes are lightweight and durable Despite provides
exceptional comfort, flexibility, of Nike shoes are very light.

• SHORTS:
The recycled polyester used in Nike products begins as recycled plastic
bottles, which are cleaned, shredded into flakes and converted into pellets.
From there, the pellets are spun into new, high-quality yarn used in our
products, delivering peak performance with a lower impact on the
environment. Most of the factories are located in Asia, including Indonesia,
China, Taiwan, India, Thailand, Vietnam, Pakistan, Philippines, and
Malaysia. Nike is hesitant to disclose information about the contract
companies it works with.
 • JERSEY:
All of these official on-pitch tops are constructed with a 100% recycled
polyester fabric, one that is made from discarded plastic bottles. What’s more is
that Nike has stated that the replica jerseys for fans will also be built from the same
eco-friendly
NIKE FINANCIAL SUMMARY:
For the six months ended 30 November 2021, Nike Increvenues
increased 8% to $23.61B. Net income increased 16%to $3.21B.
Revenues reflect North America segment increaseof 14% to $9.36B,
Comparable Store Sales (Growth- %), NAincrease from -11 to 32.5%,
Online Sales – North Americaincrease of 38% to $4.35B. Net income
benefited fromMerchandise Margins, Total - % increase of 7% to
46.2%,Other (income) expense.

Segmentation
In the customary way, there are six interactive bases for market
segmentation, Which are demographic variables, psychographic profile,
behavioral style, Geographic variables, socioeconomic variables and
benefits sought. While Nike has a general targeted segment “all
athletes”, nevertheless precisely Defines various market segments
(Shank and Lyberger, 2014).
Targeting:
Target marketing is the next step of segmentation process where the company
Systematically chooses the segments that will allow to most effective and
Efficiently achieve its goals. Nike evaluates its target market based on size,
reachability, measurability and Behavioral variables. In particular, Nike has niche
market to serve. The Company targets professional athletes and sporty individuals
providing them Specialized and innovative products. Furthermore, all products are
reachable, Even online, with the unique opportunity Nike’s consumers to create
their own Custom designed shoes, which makes the brand more identifiable and
Remarkable in differentiation to other footwear companies. It should be noted That
Nike also targets the marketplace through psychological tactics by Sponsoring
great athletes with tremendous achievements and victories. This Tactic intimately
links company’s products with triumph (Shank and Lyberger, 2014).
It is for granted that sustainable innovation is the trigger for revolutionizing the
Way the company does business and manufactures its sports equipment. For That
reason, Nike applies aggressive marketing strategies in parallel with the Marketing
mix the company develops in order to make further known its target consumers
company’s products, enchasing its uniqueness and exclusivity(About Nike, 2018).