Customer Segmentation

Customer segmentation refers to the division of customers in a market according to similarities they share. Such characteristics include spending routines, age, gender, interests among other traits. Segmentation is an efficient marketing tool as it allows the organization to focus on a group of customers in the market. The management is able to use segmentation to allocate adequate resources that address the selected group. The management of an organization use segmentation as an innovation tool.

The organization is able to identify the needs of majority of its customers and produce a product aimed for this market. Segmentation as an innovative and marketing tool enables the organization to attract and retain a client base that will support an organization's operation. Marketing research is among the methods used to evaluate the customers segments in a market. Customer segmentation profiling enables the producer to identify the consumer group to target in the market.

From profiling, the management is able to understand the needs of the customers and formulate ways of addressing these needs. Profiling also enables management to understand the efficient ways that the company can use to reach the selected segment. New and old businesses can make use of market segmentation. New businesses can use market segmentation to enter a market while established organization can use market segmentation to maintain their revenue base (Hulten, 2007).

Organizations that use segmentation as a marketing strategy ensure that they produce products for all segments but focus on one segment. The segment may be responsible for high volumes of sales or high revenue generation. Large organizations often focus on the needs of many segments by producing products that cater for each segment. Segmentation ensures that the organization maximizes it potential to attain its goals. The paper evaluates how market segmentation affects the marketing strategy used by Toyota.

Toyota is a Japanese car manufacturer that provides vehicles to a global market. Segmentation The company is among the major car producers in the market providing a wide range of products. The company uses segmentation to maximize on sales and market domination. The company can categorize its market into various segments depending on the traits of the customers. Concerning income, the company produces products that will cater for the high-income earners, middle-income earners and low-income earners. The market segment can also use fuel consumption as a segmentation characteristic.

This is where the company produces fuel-efficient vehicles with low engine capacity, moderately efficient vehicles and high performance vehicles, which have high engine capacities. The company also uses marital status to produce its vehicles. Vehicles for single people compared to cars for couples and people in a large family are other segmentation criteria. The paper will cover segmentation concerning the income generated by the customers. The cars produced to cater for the three market segments ensure that the company diversifies its income.

The high-income earners are few in the market and emphasis on quality. Engine capacity is not an issue in this group with most vehicles having more than 2000 cc capacity engines. The products are expensive and usually produced in limited stocks. Production of new designs in these segments takes place after a long time due to the lack of frequent customers (Epstein, Friedl & Yuthas, 2008). The middle class segment is comprised of middle-income spenders who spend more than the low-income earners. Pricing for this vehicles is moderate have moderate features.

The engine size is about 1800 cc, which ensures that the performance of the vehicle is moderate. The last class is the low-income earners who have the money to spend on vehicles. The vehicles for this segment are cheap and do have low fuel consumption. Owing a car provides extra expenses for the owner thus the need to purchase within the income limit. Promoting market awareness The form of advertising used by the company should ensure that the message reaches the targeted customers.

The manufacturer should ensure that the mode of advertisement used by many customers in a segment promotes the product. The advances in technology have made communication easier and accessible. Almost all the customers in the segment have access to available forms of communication. The producer can use the internet to promote the product. The use of the internet ensures that the customer has access to all products produced by the company. Magazines and newspapers are among the print media used for advertisement.

Television advertisements made by the company and aired regularly to ensure that many people view the advertisement. The use of the internet is the most efficient mode of communication especially among the high-income earners. Television advertisements are effective among the middle-income earners. Printed media is a favorable mode of advertisement among low-income earners (Bailey, Baines, Wilson, & Clark, 2009). Customers respond differently to the advertisement made by the producer. The customers who use the internet frequently ask questions through the website.

The use of the website enables customers to evaluate the features of the product. The company uses customer care representatives to interact with the customers. This mode of communication is preferred to its reliability and cost effectiveness. The customers who prefer television advertisement follow up the advertisement by calling the number displayed on the screen or visiting the company's website. Low-income users may read more about the product from the printed media and contact the producer through telephone calls and social media.

The company can carry out a survey to evaluate the source of the information about the product. This survey will enable the company to market its products through appropriate means that suit the customers in the segment. The management can also collect information from the follow up to improve the advertisement used (Dibb & Simkin, 2009). Customer segmentation plan This is the mode of marketing where the organization evaluates the available segments in the market and the effective way to communicate.

Communicating to customers for marketing research ensures that the right information is collected. The management can evaluate the use the internet to evaluate the number of customers visiting the website to determine its traffic. Understanding the segment market and the appropriate mode of advertising to use saves the organization money. Toyota's position in the global market is credited to extensive advertising and promotion of its products. The company mainly uses the internet to communicate with its customers.

This mode of communication enables the company to market its products over a wide geographical area. The communication between the customers and company representatives improves brand awareness and.