General and target market strategy
| General and target market strategy |
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General market strategy is based on the assumption that the potential client has similar needs and because most of them can be satisfied by using only one set of marketing mix activities. General market consists of buyers with essentially similar needs and sellers who provide a variety of ways to meet them.
General market strategy focuses on demand which is poorly differentiated, represented by the average buyer with similar requirements as needed. Market is a relatively homogeneous whole. As a result, the enterprises applying this type of strategy, offer their consumers the same, standard product, similarly distributed and promoted.
Applications
The premise of this kind of strategy are (from an economic point of view) so called economies of scale. Production, distribution and promotion on a massive scale will lead to a reduction in the prices of products offered, thus increasing the ability to compete with prices.
Target market strategy is designed to fit the tools of marketing mix to the specific needs of the customers. Within this strategy, the manufacturer is trying to differentiate their product in the minds of the customers through a series of promotional activities. Marketing mix can be tailored to target market by concentrating on a single part of the market, by concentrating on a number of its segments or total treatment of several segments at the same time.
Target market selection stages
- define essential customer requirements and needs, and general characteristics of the consumers on the market,
- analysis of common features and differences between customers,
- description of the existing target markets,
- choosing a segment or segments of the market.
Segment of the market selection belongs to the most important decisions that predicts the nature of the business. The difficulty with this decision arises mainly in small companies because they are generally not able to handle more than one segment of the market.
Target market selection rules
- manager must focus his activities in the area in which he could gain a competitive advantage,
- manager should choose an area already known to the company,
- manager should focus on the segments in accordance with the long-term objectives of the company, of suitable size, growing potential,
- manager should steer clear of segments on which there is a fierce battle between competitors,
- manager should assess the barriers to entry into the market and check if the operation in the segment will give the expected return
Before the final choice of target markets manager should compare market segments in terms of size, dynamism and attractiveness.
References
- Martens, R., Matthyssens, P., & Vandenbempt, K. (2012). Market strategy renewal as a dynamic incremental process. Journal of Business Research, 65(6), 720-728.
