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BTEC Business Level 3. Unit 3 Assignment 3 P5,. Identifying customers in consumer markets. Customers and Consumers A person who purchases a good or service is a customer. A person who uses the good or service is a consumer. Customers should be defined in terms of;
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BTEC Business Level 3 Unit 3 Assignment 3 P5,
Identifying customers in consumer markets • Customers and Consumers • A person who purchases a good or service is a customer. • A person who uses the good or service is a consumer. • Customers should be defined in terms of; • What they want in terms of price • What distribution is most convenient • What communication channels they can be reached through • What they want from the product • Buyers • As well as individual buyers there are also B2B markets where businesses will buy too. E.g. A corner shop buying from Bookers Wholesalers.
Market Segmentation • All markets can be divided into segments, each segment has its own profile which has similar characteristics. • Market Segmentation allows a business to improve the product or service offered to the customers, this then increases demand for the product and meets the customers needs more closely. • Segmentation can be based upon the following; • Geographic • Psychographic • Socio-cultural • Demographic
ACORN and MOSAIC A business can segment by two tools which allow segmentation. ACORN- is a geo-demographic tool that allows a business to identify and understand the UK population and local demand for products and services. MOSAIC classifies households into 12 groups based upon households that share certain characteristics
B2B Segmentation • Business markets are segmented in a different way to individuals; • Size and Value • Region • Sector- Private, public, Voluntary • Product and industry.
P5- Plan • Introduction: Explain why a business may want to segment their market- how useful is it to businesses. • Explain methods of segmentation; • Geographic • Demographic • Psychographic • Lifestyle • ACORN • MOSAIC • Reasons for choosing target groups; • Accessibility • Current and future prospects of groups • Profitability • Ability to service the customer group • Fits in with organisations mission. • Choose six different products and explain the customer profile. You should include at least one B2B product. • Conclusion: • 1.how do different businesses target different customers- based on their size, scale, products sold etc. • 2. Why is it important for your business to segment their market?