What is market segmentation?

To identify target market we need to divide the market into small segments according to the consumer characteristics and their needs. This segmentation allows companies to gain higher market share or niche market.

Why we need market segmentation?

• To enhance profits for business

Some of the consumers have different types of nonrefundable income. So they are so much sensitive to the products price. By using market segmentation consumers can see average prices on the products. Therefore business will enhance the company’s profits.

• To give better chances for development of the business

Normally market segmentation will increase sales. Consumers can be fortified to buy the product after some of introduction of the product lower price.

• To keep more customers

Consumers’ environments change frequently. For an example they may get older, they find new jobs, they change their buying rates etc. Therefore marketing products needs to address different customer’s life cycles. Otherwise they switch to new products or brands.

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• To enhance target market communication

Companies need to deliver the products details to appropriate consumer spectators. If the target market share is too comprehensive, there is a high risk to that product. Because they miss some of the key consumers and also they increase their communicating cost as well. Therefore that may become the product unprofitable. So with the market segmentation we can target the best most valuable customers and reach them at lower communicating cost.

• To gain stake of the market

If the company business hasn’t any strong position in the target market they are likely to be less profitable. If our production brand doesn’t have any scale of economy they are pressured by the other distributors and they limit their market share. So segmentation and targeting will gain more competitive position in the market. Also it will reduce the marketing costs as well. And also their product may become the most favored choice among the consumer groups. The main point is the segmentation will allow small and medium sized enterprise firms to strive with the large scaled enterprises firms.

Target market or market segmentation in Brazil

Target market: Brazil younger generation ranging age 18 to 39

We used these profilers to segment the market

1. Geographic
2. Demographic
3. Psychographic
4. Behavioral

In recent years market research says that Brazil’s younger generation ranging from age 18 to 39 is more likely to drink Herbal tea. Because younger generation likely to try innovative products of tea as well as they more concern about their physical condition. This group has the largest segment at 69% of the total population (201 million). We choose younger generation because of they can be easily influenced by the media, they more likely to try new things. As a health and slim due women have a tendency to have more interested in herbal tea products rather than male. Both genders will see our products as a healthy beneficial beverage.

According to the research, technology of the Brazil it is approximately 10.1% ahead of the global average. That means there are about 75,982,000 internet users in the country. And also their popular technology device is mobile phone. So by using majority of internet users and mobile phone users we can promote our product to their younger generation more easily. Because media is the best way we can influence them to buy our product. Market research shows that 68 percent of people are employed. Market research shows that 25 percent of the younger generation both female and male is working very long time. So they haven’t much time to bother about their physical condition. So we can influence them to use our herbal tea to maintain their physical condition. Research says that Brazil average household income and average personal income is above $10,000.