How to evaluate the profitability and stability of market segments
The profitability and stability of market segments can be evaluated gathering and analysing data on the current segment growth rates, segment sales and expected levels of profitability of the different segments. The segments with the right growth and size characteristics will appear the more stable and attractive segment to a business.
Because some businesses are small in size, therefore do not have the resources to compete in or serve larger market segments, therefore a smaller segment will be more stable and have a potentially increased levels of profitability.
The profitability and stability of market segments can also be evaluated through the analysis of the aims and objectives of a business, this is because some market segments which may appear attractive, can be quickly dismissed because the they not connect with the objectives of the company in the long run or there may not be sufficient resources and skills needed to succeed in said segment.
How a range of products may appeal to different market segments
Different products can appeal to different market segments through how they are branded, brands tend to have certain personalities which allows people in market segment to identify with the brand, for instance a women’s clothing line under a brand with the caring, ambitious and dependable personality can appeal to mothers, as most mothers can relate to or identify with these traits at some point in their life.
A range of products can also appeal to different market segments by using umbrella brands that target different market segments, for instance the Armani brand has different brand labels that target the luxury market segment, entry level retail market segment and even the baby clothes, toddles and teenage clothing market segment.
