Identifying Market Segments and Targets

Question: Discuss about the Identifying Market Segments and Targets. Answer: Introduction: Segmentation, targeting and positioning framework can be identified as one of the major important strategic issue for an organization. It is impossible for a company to satisfy the whole population with a certain product. Hence, it is important to identify who are the basic consumers of the product offerings, and developing it according to their choices. Moreover, it is also important to provide a point of differentiation to the customers so that they choose the brand over its competitors. Hence, it is important for a company strategically using the STP framework. Being a luxury hotel chain Jumeirah Group is also using this framework for its business growth. Discussion: As mentioned by Kumar and Zia (2016) the STP framework is typically important for a company to be successful in the market with long-term validity. The elements of this framework help in strategic management of an organization. Segmentation: As mentioned by Bickhoff et al. (2014) with the help of this element the companies try to identify the target customers for the product and who will best be satisfied with the offerings of the product. As discussed by Wurster and Scarlat (2014) by identifying the target customers the companies try to make the product develop according to their needs and lay concise strategies to attract them to the brand. As mentioned by Bickhoff et al. (2014) by creating a demographic, psychographic, and geographic and benefit based segmentation, the companies try to capture the target customers. Targeting: This element helps the company to develop measures of segment attraction. As mentioned by Wurster and Scarlat (2014) in the targeting strategy, the company tries to develop the product according to the need of the selected segments. Positioning: Positioning can be identified as differentiating the brand or the product from that of its competitors. It provides the companies a significant level of competitive advantage. By developing an effective marketing mix, the companies try to posit its products in a market (Bruggeman et al., 2012). In the case of Jumeirah Group, the STP framework can be discussed as followed: Segmentation: Demographic: the high-income group, high educational qualification, high class consumers Geographic: the internationals customers Psychographic: the liberal, extravagant, extrovert, lifestyle oriented customers Benefit: The leisure time travelers, the high and light users (Jumeirah.com. 2016). Targeting: The company is using the micro marketing as, they have identified that the choice of the customer are different in every sector. As mentioned by Bickhoff et al. (2014) in the service industry it can be identified as the best possible targeting option. Positioning: The main positioning strategy of this group is branding itself as one of the most luxurious, 5 star hotel groups. The company is using the premium pricing policy for separating itself from its competitors (Jumeirah.com. 2016). The company is typically using the expressive positioning strategy, and stressing on the emotional or expressive association of the service. By providing a sense of aristocracy, it is typically alluring the high-end customer groups towards the brand. Critically evaluate the element of the STP framework that is of the most strategic value for organizations. An organization put a lot of time in coming up with the right kind of marketing mix and developing the ideal positioning strategy. But it is of utmost importance that the organization segments its market area properly so that they can properly communicate with the end users of their product. Business with a good plan for segmentation already wins half of the battle in marketing and thus all the latter parts just fits well in the cog (Global Market Line Industry Profile, 2012). The segmentation should be properly done all the various aspects of its should be well considered such as demographical segmentation, geographical segmentation, behavioral segmentation and psychographic segmentation. The organizations basically segments their market in the order of the preferences and the attitudes of their potential customers. The segmentation is done after having a thorough research of the market. Market segmentation gives a temporary but firm commercial advantage to the organization. It reduces the risks by thoroughly distinguishing the potential customers and the methods they can be reached. Marketing segmentation overall increases the marketing efficiency of an organization and thus help the marketing strategy to work consistently and as planned (Kotler and Keller, 2012). Conclusion: STP is fundamentally helpful for the companies to serve the target customers for the best profit outcome and brand popularity. As discussed above, the Jumeirah Group is also successfully operating with this STP framework. But segmenting the customers, and targeting the high end group, the company has strategically developed its positioning policy which is being helpful in creating huge level of brand success. Hence, it can be concluded that for market success, it is important for the companies to use the STP framework prior to its strategic implementation. References: Bickhoff, N., Hollensen, S. and Opresnik, M., 2014. Step 2: Strategic and Operative Marketing PlanningSegmenting, Targeting, Positioning. In The Quintessence of Marketing (pp. 47-110). Springer Berlin Heidelberg. Bruggeman, J., Grunow, D., Leenders, M., Vermeulen, I. and Kuilman, J. (2012). Industrial Corporate Change.Market positioning: the shifting effects of niche overlap, 21(6), pp.1451-1477. Global Market Line Industry Profile. (2012).Software Services Industry Profile, pp.1-35. Jumeirah.com. (2016). Luxury Hotels Europe, Middle East Far East - Jumeirah. [online] Available at: https://www.Jumeirah.com [Accessed 5 Nov. 2016]. Kotler, P. and Keller, K. (2012). Marketing management Identifying market segments and targets.New York, New York: Pearson, 14(8), pp.212-239. Kumar, N.S. and Zia, M., 2016. A Three Dimensional Vertical Differentiation Model: Implications for Segmentation, Targeting and Positioning. Targeting and Positioning (April 3, 2016). Wurster, R.A. and Scarlat, C., 2014. Segmenting, targeting, and positioning of mobile payment services. Mobile Electronic Commerce: Foundations, Development, and Applications, p.367.