Market Segmentation

Question 1

What is market segmentation?

Answer 1

Market segmentation is a systematic categorization
of potential markets for your idea.
Essentially, it is a description of multiple groups
of target customers, groups that are homogeneous and distinct.

Question 2

How to do market segmentation? Brainstorming phase.

Answer 2

Important here not to over analyse, just brainstorm.
1) Identify industries e.g. automotive;
2)Subdivide each industry into markets (non -electric, hybrids,…) and market segments (sedans, sport cars,…); 3)List the people (end-users) who might benefit from your idea in this industry & market segment;
4)Describe the various tasks that they perform and how they would use your product. ;
5)Narrow the field => list the top 6 market segments (your time is limiting factor);
Next step: primary market/customer research.

Question 3

What are your end users?

Answer 3

Not customers; a person who uses your product. A customer pays for your product.

Question 4

What is primary market/customer research?

Answer 4

Basicly go out and talk to people.

Question 5

Why do we do primary customer research?

Answer 5

Because we are looking for a homogeneous group of target customers who experience a similar problem, who you could deliver your solution for a similar cost and who would pay a similar amount for your solution.

Question 6

How do you find promising market segments?

Answer 6

Ask the following questions:

1) who is the end user?
2) what is the application? Why would the end user use the service?
3) What is the benefit? What problem is solved?
4) Who are the lead customers? The influential customers, through who’s example others would be inclined to use the product.
5) What are the market characteristics? that would promote or impede the success of your product.
6) What is the market size of the segment?
7) What is the competition?
8) Who are your necessary partners?
9) What are the complementary assets required? e.g. for webshop => computer + internet + credit card.