#What are 6 Advantages of Segmentation?

#What are 6 Advantages of Segmentation?
The same dilemma is faced by companies. If they don’t do segmentation, they do not know whom they have to sell and what they have to sell. I have emphasized on the advantages of segmentation. The segmentation done by you can be based on the company. Thus without segmentation, your target group is just a population and you will never understand how you can target them.

Focus of the Company
Segmentation is an effective method to increase the focus of a firm on market segments. If you have better focus, obviously you will have better business. Companies have started focusing on small car segments. This is nothing else but a company changing its focus for better returns. Thus companies base their strategy completely on a new segment which increases its focus and profitability.
Increase in competitiveness
once your focus increases, your competitiveness in that market segment will increase. If you are focusing on youngsters, your brand recall and equity with youngsters will be very high. Your market share might increase and the chances of a new competitor entering might be low. The brand loyalty will definitely increase.
Market expansion
Geographic segmentation is one type of segmentation where expansion is immediately possible. If you have your market strategy on the basis of geography, then once you are catering to a particular territory, you can immediately expand to a nearby territory.
Customer retention
By using segmentation, Customer retention can be encouraged through the life cycle of a customer. The best example of this is the Automobile and the Airlines segment. You will find major example of customer life cycle segmentation in the Hospitality segment whether they be hotels, airlines, or hospitals.
Have better communication
One of the factors of marketing mix which is absolutely dependent on STP(segmentation targeting and positioning) is Promotions or communications. The communications of a company needs to be spot on for its TARGET market. Thus if you need a target market, you need segmentation. Communication cannot be possible without knowing your target market.
Increases profitability
Segmentation increases competitiveness, brand recall, brand equity, customer retention, communications. Thus if it is affecting so many factors of your business, then definitely it affects the profitability of the firm.

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