The Advantages of Market Segmentation and Its Wide Application from Business to Economics

Delta County MI.
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Market segmentation is a process of breaking down the market to find the place where it is best to focus a businesses efforts to create the highest ROI on marketing dollars. Whether one is engaged in promoting their business, tourism to a specific area, working on a political campaign, or trying to share an idea there will be some that will be more receptive to new ideas and some that won't. Finding out which segment of the market is most likely to respond to a particular marketing piece is going to return the most value for the effort.  

Dr. Mark Camilleri in his work entitled, 'Market Segmentation, Targeting and Positioning. In Travel Marketing, Tourism Economics and the Airline Product' provides some insight into different market segmentation strategies that include demographic segmentation, geographic segmentation, psychographic segmentation, behavioral segmentation and product related segmentation. The piece provides a solid overview within a short paper on the different ways of promoting reaching intended markets. 

As an example, I have been exploring ways to develop the small town of Escanaba Michigan into an innovative cluster by hedging start-ups, outdoor tourism, existing small batch manufacturing, shipping, government spending, a growing digital nomad trend to bolster the local economy and make it more resilient to environmental changes (No idea if that will actually happen but its fun to sort of think about. It takes a lot of hands to make transformational change. Advice on Change)

One of things I could do is go through each of the different segmentation strategies listed above and further define the economic cluster elements (cluster means certain businesses and activities that enhance each other to create greater value than the individual parts) to determine who would be most likely to invest and/or relocate to fill that need. Once that has happens one could find the similarities among them to create a brand and marketing mix (products, prices, channels, and promotional tactics) that can be used to strengthen the cluster/economy.

What we should learn is that marketing principles aren't just for businesses alone but can also be used in politics, economic development, and general awareness. It is a process of researching and understanding different aspects of the market to ensure that the message reaches the intended audience that is most likely to respond. It provides insight into the specific channels the target market uses and the manner in which they want to understand it. Using further psychological principles of cognitive engagement we are able cater the messages to grab the attention of and encourage an active response.

Camilleri, M. A. (2018). Market Segmentation, Targeting and Positioning. In Travel Marketing, Tourism Economics and the Airline Product (Chapter 4, pp. 69-83). Springer, Cham, Switzerland.

(PDF) Market Segmentation, Targeting and Positioning. Available from: https://www.researchgate.net/publication/319085560_Market_Segmentation_Targeting_and_Positioning [accessed Mar 01 2022].