Page 4: The need for segmentation
Within markets, not all customers are the same - they have different tastes and want different things. As a result, particular markets can usually be further divided into discrete segments. Each group consists of people with similar needs and requirements. The organisation then develops strategies that are closely aimed at satisfying each customer group. This process is known as market segmentation.
Through segmentation, United Airlines can identify market opportunities and meet its marketing objectives. Segmentation gives an airline a better understanding of its customers, the services they require, where and when they want those services and how they would prefer to pay for them.
United Airlines segments its market so that it can:
- identify consumer needs and the proportion of customers who have those needs
- develop products and prices to meet these needs
- target communications at customers within each segment
- allocate funds to support and develop each market opportunity.
Market segmentation therefore enables United Airlines to maximise the efficiency of its marketing efforts by moving the company to use a different strategy for each market segment.