What are the benefits of Market Segmentation and Targeting?
Posted by Your Guide on October 31, 2005 3:32 PM The main benefit of market segmentation and targeting is, in essence, better marketing. Because the focus is specifically on the desires and needs of a niche group, the likelihood of higher response rates increases accordingly. The more highly targeted the segment, the higher the probability that the companys marketing and advertising promotions will match with the needs of that group or audience. Typically, this higher response rate is common the more marketers drill down in their segmentation. Using a combination of the geographic, demographic and psychographic variables, it is now common with modern databases to effectively predict the likelihood of purchasing. This pattern of predicting or predictive modeling as it is called has opened a new realm of marketing for businesses. A relatively recent development, these predictive models are based upon decision trees, which ask a series of questions and create a pathway in which the deeper
