Essay
Unit 3 - P5
- Institution
- PEARSON (PEARSON)
explain how and why groups of customers are targeted for selected products
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Using targeting and market segmentation allows a business to understand their possibleclients, and understand how to effectively target them to advertise their products. It is im-
portant to understand the different types of clients, the three different types of clients are;
● Buyers: A buyer is a professional purchaser, where they purchase products or ser-
vices to resell, as they generally have a greater understanding of the market.
● Consumers: A consumer is an end user of a product, however, does not have to be
a purchaser.
● Customer: A customer is a person who purchases products or services from the or-
ganisation.
When understanding the types of clients, it is useful to be able to segment the market.
Market segmentation is the process a business must undergo to divide the market into
smaller groups, depending on each customer's similarities, demands and needs. This al-
lows a business to analyse possible consumers and clientele and allow them to under-
stand which group they would invest more time in. For Barclays, this is important as it al-
lows the understanding of which services to offer a certain customer or what features do
certain services or products need to suit a certain group. The bases for segmentation of
consumer markets can be;
Geographical
Geographical segmentation is dividing individual in terms of their geographical location,
such as where they live. This is important as different countries can require different laws
or operational activities. Thus different customers would need different services based on
where they live. Barclays, for example, changes the services and features it offers based
on the country they are operating in, such as including lower transfer rates, for people that
send remittance regularly, such as in the United Arab Emirates.
Physiological
Psychographic segmentation is the creation of groups on psychology, personalities and
characteristics, lifestyles and attitudes. As Barclays like to focus on younger audiences
joining university, they are able to target them more specifically. Barclays also work with
Apple, Orange and university services, such that they incorporate daily activities many stu-
dents participate in, making having a Barclays card more efficient with their lifestyle.
Demographical
, Demographical segmentation is separating individuals based on their age, gender, finan-
cial status, ethnicity or religion. Barclays focuses on age and financial status of their cus-
tomers. As Barclays has many different services and products each for different age and
financial status, separating the market into different ages and financial status allows them
to understand what are the most popular services they are most likely to sell. Barclays
tend to focus more advertising campaigns to the youth and elderly, due to the larger prof-
itability they will achieve. Students as they have a high possibility of being long-term clients
and elderly as they have a larger disposable income. Focusing on demographical segmen-
tation can be more efficient in understanding their market, thus leading to an increase in
profit. They can also focus on using geo-demographical systems to identify and reach dif-
ferent target groups through;
ACORN: A Classification of Residential Neighbourhoods focuses on the location and life-
styles of individuals. The information gathered is done by analysing both demographical
and geographical data and thus they would be able to create focused marketing cam-
paigns.
MOSAIC: Mosaic marketing combines information of lifestyle segmentations that combines
the behaviours and attitudes of individuals and targets them based on their preferences.
Behavioural
Behavioural segmentation is the separation of individuals on their buying behaviour such
as; brand loyalty, benefits, occasions and frequency. As Barclays is a bank, most transac-
tions are long-term and are life long. However, Barclays can use behavioural segmentation
in understanding when most people decide on a bank and what features hold the most pri -
ority in choosing a bank.
Once a business segments its market it's important to understand how to target those par-
ticular groups. It is vital for a business to target certain products and services towards par -
ticular individuals who would most likely purchase or subscribe to the service. With Bar-
clays, they want to ensure that they are targeting the correct consumers with the correct
product and service. Having knowledge of their target market they are able to develop a
more effective marketing plan. This can be done through;
Business to Business
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