Requirements driven market segmentation

Abstract

The acceptance of the segmentation concept appears to have outstripped the ability of industrial marketing professionals to make the concept either operational or strategically relevant. As a result, we often find that industrial customers are not divided into segments; customer selection often is opportunistic and unplanned; and industrial niche marketing remains an unfulfilled promise for too many industrial firms. This article attempts at least a partial remedy for this problem by offering a systematic and practical segmentation process and paradigm with requirements in the form of needed operating parameters and desired common buying factors as its centerpiece. The model incorporates a group process, and also shows how both corporate and competitive strategies are integrated into the segmentation process.