Flowing Waters Mini-Case - Essay Example

Flowing Waters Mini-Case Flowing Waters Mini-Case Analysis Market segmentation refers to the division of the market into different groups of customers with similar needs and products and services. This is considered one of the marketing strategies used by many companies a case in point is the Flowing Waters. With Regard to Flowing Waters, the company has identified ten tapestry segments which accounts for most of the profitable customers. The company also went ahead to establish the number of existing customers in each of the cities with lower than average customers.

The main aim of this form of segmentation is to leverage its scarce resources in terms of market mix, products, prices, distribution and promotion that meet the kinds of market segments. For instance, Segmentation has been used by the Flowing Waters company as a way of identifying where to solicit potential customers whose profiles matched with those of proven highly profitable customers. This is probably the reason as to why the Chief Executive Officer of Flowing Waters have decided to invest a multi-million dollar national advertising campaign targeting the ten market segments that represents highest profitability customers (Lacobucci, 2010).

Assumption The analysis is based on assumption that customers preferences vary. With regard to Flowing Waters company, some customers would prefer Alba Springs, others Belton spring, or crystal Fountains while others would only like Crestwood. This is based on the fact that if all customers of Flowing Waters had universal preference, there would be no need of segmentation (Lacobucci, 2010). Primary Decision Criteria The primary decision pertains to the question as to whether the market segmentation practice used by the company is useful and can serve its purpose.

This calls for the company to make decision regarding the following questions: Is the market segmentation in line with the firms’ basic marketing strategy? Does homogeneity exist within the whole market? Are the segments measurable and finally whether the market segments are accessible (Lacobucci, 2010). Appropriateness For Using Tapestry Segments All companies need to understand its customers in order to be able to supply them with appropriate products and services and to get in touch with them through their preferred media (Lacobucci, 2010).

All this requires a robust segmentation system which is capable of accurately profiling these kinds of diverse markets. Lacobucci (2010) argues that the predictive and versatility power of Tapestry segmentation is appropriate in such a situation. This is because it allows users to integrate data and national consumer reports into Tapestry segmentation for a company to be able to identify the best market segments and reach them via most cost effective channels. This is the reason as to why Flowing Waters took the initiative to use tapestry segment as a way of determining its customer needs.

Tapestry segmentation gives a company an opportunity to profile its customers and constituents by offering standardized geographical areas such as polygons on drive time, distance and other specification (Lacobucci, 2010). This explains why the Flowing Waters have been able to locate areas that have customers who bring high profits to the company. It is also appropriate as it identifies customers using ZIP code and block, addresses or site locations. References Lacobucci, D. (2010). Marketing Management.

New York: Cengage Learning.