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Batch: 2015-17
Marketing Management
Group No. 6
MARKET SEGMENTATION
Why we need segmentation?
There are two main segmentation approaches: needs-based and characteristics-based.
Needs-based segmentation is based on customer needs. This is the understanding that drives product
development and brand strategy.
Characteristics-based segmentation is based on the characteristics of the customer and area. It is the process
of segmenting customers based on their characteristics, attitudes or behaviour. This process helps drive the
development and execution of customer strategy and targeting.
A basis for segmentation is a factor that varies among groups within a market, but that is consistent within
groups. One can identify four primary bases on which to segment a consumer market:
Geographic segmentation is based on
Marketing Management
Group No. 6
Samsung remained the leader in the worldwide smartphone market but was the only company among the top
five to see its shipment volume decline year over year. The new Galaxy S6 and S6 edge arrived with mixed
results as a limited supply of the edge models did not keep pace with the demand for the new curved handset.
Older Galaxy models, however, sold briskly thanks to deep discounts and promotions throughout the quarter.
Apple's second quarter proved to be its biggest fiscal third quarter ever with 47.5 million units shipped. The
iPhone once again continued to dominate in China where shipments remained buoyant after a strong first
quarter. The larger screened iPhones along with the rapid expansion of 4G networks in China continued to
drive momentum for Apple in Asia/Pacific.
Xiaomi continues to find success in its home country thanks to both premium and entry-level devices like the
Mi Note and Redmi 2 handsets, which helped Xiaomi, achieve a 29.7% year-over-year increase. With a
significant presence in India and Southeast Asia, Xiaomi is now looking to bulk up its IP portfolio to expand
its reach even further outside of Asia/Pacific, starting with Brazil.
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Marketing Management
Group No. 6
Lenovo, the third and final Chinese OEM on the list, captured the final spot despite steep home turf
competition from both Xiaomi and Huawei. Outside of China, Lenovo continued to witness success in many
emerging markets such as India with entry-level and mid-range models like the A600 and A7000, sold via
Internet retail channels.
Huawei's mid-range and high-end models continue to prove successful with the flagship P8, Honor Series, and
Mate 7 handsets delivering sustainable growth both in the consumer and commercial segment.
Top Five Smartphone Vendors - Worldwide Shipments, Market Share, and Year-Over-Year Growth,
Q2 2015 Preliminary Data (Units in Millions)
Vendor
2Q15
Shipment
Volumes
2Q15 Market
Share
2Q14
Shipment
Volumes
2Q14 Market
Share
Year-OverYear Change
Samsung
73.2
21.7%
74.9
24.8%
-2.3%
Apple
47.5
14.1%
35.2
11.7%
34.9%
Huawei
29.9
8.9%
20.2
6.7%
48.1%
Xiaomi
17.9
5.3%
13.8
4.6%
29.4%
*Lenovo
16.2
4.8%
15.8
5.2%
2.4%
Others
152.5
45.2%
142.2
47.1%
7.3%
Total
337.2
100.0%
302.1
100.0%
11.6%
16.2
4.8%
24.3
8.0%
-33.3%
Lenovo + Motorola
Source: IDC Worldwide Quarterly Mobile Phone Tracker, July 23, 2015
SCENARIO IN INDIA
In India, for the first time, feature phones registered static volume growth as sales were impacted by the rapid
growth of smartphones during 2013. However, feature phones continued to significantly outsell smartphones in
India due to their popularity in rural regions. Rural consumers and senior citizens continued to prefer feature
phones over smartphones due to the ease of usability.
India constitutes approximately 10% of world-wide sale of mobile devices. Market is supported by global and
local players as well. Growing influence of local handset players in the low-end segment has forced high-end
companies to sell phones at a discounted rate. Despite very high competition Mobile Industry is growing at a
very high pace.
LEVEL OF COMPETITION
Global mobile manufacturing firms are facing tough competition from local mobile manufacturing
firms. New Entrants are using various techniques like- low price, innovative product, etc. to capture
market share. Companies like Micromax, Karbonn, etc. are using low-price strategy to gain market
share. With the entry of low-priced Indian market handset players like- Micromax, Karbonn, etc.
focusing on value conscious consumers has intensified competition in the Indian market mobile device
market.
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Marketing Management
Group No. 6
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