THE RELEVANCE OF MARKETING SEGMENTATION

CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND TO THE STUDY
It is usually impossible for a particular organisation to have a comprehensive knowledge of all the customers that made up a particular market, whether is industrial, consumer services (Coles, 2001). This is the situation most times because customers are usually headily read, many and heterogeneous in what they buy and now they buy. So rather than dissipate energy trying to serve all the customers that make up market without having a comprehension knowledge about any particular sets of the customers, an organisation with a good vision is expected to study the various sets of customers with a view to identifying the particular set/sets that could be served most effectively and profitably and settle for some. One basic tool required to get this done effectively in the market segmentation, which Onayemi (in Sanyaolu, 2002) defines as the process of dividing a market into district sub sets of customers, each of which can be considered as a target of market with common needs and can be theory approached with a district of marketing mix, action or programme.
Market segmentation is according to many textbooks one of the fundamental principles of marketing. Kotler (2002) marketing theory suggests that businesses adopting a market segmentation approach can enhance their organisational performance.
Kotler (2007) market segmentation is grounded in economic pricing theory which suggests that profits can be maximized when pricing levels discriminate between segments. Frank et al (2002), one reason for the wildspread acceptance of the approach is the belief that organisation cannot normally serve all the customers in a market.
Kotler (2002) state that customers are hundred numerous, and diverse in their buying requirements. The implication here is that segmentation helps to homogenize market interogeneity and coincidentally allows for improved organisational performance by targeting specific segments of the market. Thus, customers who have been aggregated according to similar buying needs and behaviour will tend to demonstrate a more homogeneous response to marketing programmes (Choffray and Lillien, 2003; Wind, 2001).

Modern marketing literature identifies a range of benefits for business pursuing a segmentation approach. The underlying logic is that segmentation can enhance marketing effectiveness and improve an organisations ability to capitalize on marketing opportunities (Bean and Ennis, 2001; Weinstein, 2002). This is partly due to the fact that segmentation builds on an excellent understanding of customers and competitors which can lead to fewer direct confrontations with competitors and the design of more suitable marketing programmes.
Research has also show that segmentation also helps business to allocate financial and other resources more effectively (McDonald and Dumbar, 2003). Segmentation encourages businesses are to play to their strengths by focusing their resources on the most attractive areas of the market, and consequently earn better profits. Considering these claims market segmentation it could therefore be said that managers who are familiar with the concept and its application should achieve better performance than their counterparts who are neither familiar with it nor its application. This is the basic for the research in this project work which considers the views of staff of Coca Cola Plc Benin City.

1.2 STATEMENT OF PROBLEM
There is a chain network between the consumers and the market. For an organisation to stand, it needs to understand the working relationship between the two;
However, the market is divided to segment to put a check in place. This is as a result of inadequate assessment of the role marketing segmentation towards improving organisational productivity and performance and management inability to boast productivity.