|Factors to be considered to select market segments|
1. Market segment analysis
|At first market segments should be analyzed for selecting the best market segments. While analyzing the market segments, their size, growth rate and long-term profitability should be studied carefully. Besides this, weak and string aspects of present and possible competitors should also be studied and analyzed. Information|
2. Market coverage
- Single segment coverage: Single market segment coverage is market centered strategy. Under this strategy a company selects only one market segment and prepares marketing mix for this.
|Single segment coverage|
- Multi segment coverage: In this alternative, a company selects two or more segments at a time and prepares separate market strategies accordingly. This strategy helps the company to distribute risk in different market segments. In this the company becomes successful to promote sale and earn profit. While adopting multi segment coverage, it becomes easy for the company to go to more attractive segment from less attractive ones. But this strategy is more expensive. Preparing separate strategies for each marketing mix becomes costly.
|Multi segment coverage|
- Product specialization: In this alternative, the company sells one types of product in several market segments. In other words, the company supplies only one kind of product to many market segments. The company uses slightly different marketing mix for each market segment. While adopting such strategy, the company can achieve specialization in one product. Marketing mix can be changed in less expense and risk is distributed in different segments.
- Market specialization: In this alternative the company selects only one market segment and deals with different types of products by specializing in them. While adopting such strategy good will of the company can be increased but the market cannot be expanded depending on only one market segment.
- Full market coverage: Under the full market coverage one company selects all the market segments as far as possible and deals with all the products under one line. For example: Nepal Bottlers Company has been selling its products in all markets segments. Similarly, IBM has adopted the strategy of full market coverage.