The decision of which segments to choose is perhaps one of the most difficult challenges for a firm. The reason? Firms often identify a greater number of attractive segments that they are capable of pursuing, given their limited resources. It is tempting to enter all segments (see the tutorial on segment coverage), especially those that are growing and represent potentially great profits. In marketing, while we recognize these possibly profitable segments, we take into consideration all parts of the analysis to make sure the firm doesn’t enter into segments which ultimately requires resources the firm doesn’t possess (in particular, with respect to satisfying customer needs and not being overwhelmed by the resources of competitors).
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