Importance of Segmentation in Marketing Concept and the Product Development Process

1.0 Introduction: The electronic industry is known for its innovation and provides modern comfort and fun to customers. The competition in this industry is very high as the demand and supply is very huge hence marketing concepts plays a vital role in attracting the target customers. The electronic industry is relatively a new concept to baby boomers and X generation people and hence the target market become very narrow as the need of the range of electronic product is limited to different group of people. Innovation and upgrading the existing version is another important factor in this industry to stay competitive as the product life cycle of electronic products are very short. The introduction of innovative new products is the key success for every organization but developing a new product is not an easy thing to do, as it consumes lot of effort and time. The important thing in new product development is to understand the customers need and identifying the target market. The objective of this paper is to cite the importance of the Segmentation in electronic industry and the process of innovative product development to stay competitive 1.1 Study Background: The need in this industry is always high as the requirement and technology advancement changes every day. Research and development is the core competence of electronics industry or else the company will lose their market before they sustain. To understand the importance of Segmentation and product development Lets take the famous Apple brand which is well known for innovative new products, we have lot of variables can be considered to analyse and understand for their successful new product development to satisfy their target market. (Anderson Dale O. 2001)

Everyday customers expect something new to be introduced and to make that happened company has to spend lot of money to stay competitive. The growth is very fast in this industry as well as it declines faster than growth since the product life cycle is very less even less than a year. To satisfy these customers the company has to focuses mainly on the innovative product development and the identifying their target customers. (Hooley G J; Saunders J A; Piercy, 1998) 1.2 Study Area: In electronics industry differentiating themselves from their competitors is very important to satisfy their customer. The customer also become very choosy when comes to electronics products as they know the consequence of buying a poor brand or poor quality product will lead them to losing money. This report looks in to the electronics industry in general and how they are focusing the customers and how they are developing the product from the statistical analysis. Electronics industry is very wide and many big players are there in the competition among them, Apple Inc is the leader in the Laptop manufacturing and they are known for their innovative idea and customer satisfaction. Here in this report it concentrates on how Apple segmenting their customers and the process of product development. To achieve the above issues, Apple has used various segmentation tools and product development process to satisfy their customers need and finally the results was evaluated through controlling and monitoring. 1.3 Research Structure: The Report is mainly formulated to analyse the Electronics industry in general especially in terms of indentifying the customers tastes and liking in this context. In this research the power of the segmentation in the field of marketing is explained and the how the process of product development helping the company to generate revenue and remain competitive in this contemporary market.

Apple Inc is selected in particular and studied their business to know how the segmentation process and process of product development helping them achieve their mission. As we all know Apple Inc is leader in their industry yet the importance of the above mentioned field is shown in terms growth of the business. The main idea of this paper is to analyse the importance of segmentation process and the process of product development in context to the growth of the company and customer satisfaction and is it possible to measure the outcome of the result if is it so is the result is positive for the companys objective or not. The revenue of the company is also measured also can be used to evaluate the result of the of this strategy. 1.4 Research Objectives: Through this paper we are concentrating on two major concepts of marketing and its real time usage in this modern world. Initially this Literature focuses at the importance and usability of segmentation and the process of product development concept. This literature ends with the small section which illustrates Maintaining and control of the Quality and finally with Conclusion. 2.0 Literature Review: Market segmentation is the process of segmenting or splitting the target audience in to different categories or which means the way the company is going to serve the different group will also be different. We can segment the market in any number ways like consumer base or potential consumer base etc. In traditional marketing the market is segmented by demographically i.e. age, ethnic group, gender geographical locations, behavior or acceptance of the people, education, lifestyle, income and so on. (Hooley G J; Saunders J A; Piercy, 1998). The above mentioned segmentations are in usage for many years and it is argued and considered as very general way of segmenting the market. In this contemporary competitive market, the marketers started to see many new way of segmenting their target audience by looking at their

consumer life cycle stage, marital status, likes and dislikes and the position younger generation and so on. ACORN: A Classification of Residential Neighbourhoods can be taken as example which brought many such objective measures together (Hooley G J; Saunders J A; Piercy, 1998). These constitutes group measures, but the use of more personal measures are seen in some segmentation strategies, which may be consisting of inventories, including private person values in fair trade products. Lifestyle inventories may be used to classify group of consumers with common behavior. Segmenting has beneficial impact which is sometimes direct and indirect for the suppliers. We cannot predict the purchasing decision of the consumer since they are placed in various segmenting section by the suppliers and the advertisers (Kotler P, 2003). However, we can assure that proper segmentation of the market and targeting them will definitely have impact on consumers purchasing decision. For Example: If our products are for baby boomers, then they have to be targeting at the segments of the market with more people with age greater than 50, High range branded cars may be targeted at high-income families, and if it is a football match it should be held in a football ground, venue is also important which indicates the geographical segmentation. Similarly Apple computers need to be targeted to those people who can afford and use them, Computer savvys may be further broken down into more defined segments. Identifying the segment will give the clear picture for the company about the higher potential segment in terms of money. It also implies that we can segment different section within the company to serve different segment people. For example In supermarkets we may see both low price and finest brands sold in the same shop, Apple also provide different products, with different configuration from low end to high end to serve the different segment of people whereas when launching a newer products any company will require a larger investment so most of the suppliers will look for higher disposable income group as well as well as the early adopting buyers. Even the company will look for developing their early existing segments, for example, Mac book pro release by Apple specially designed to attract the younger generation, which created a fresh sector in the already existing market. This builds on the same brand name and appeals to a similar segment of the market (Anderson Dale O. 2001).

Specifically we can define as by identifying the market segments we are actually identifying the potential of each segment and its needs which may be matched with the company products to provide solution. Marketing is actually providing solution to the customers needs if a company can match their goods with the identified segments they can produce effective sales. Any company which has a business unit will have to consider about their operations and market plan which should coincide with the strategy to run the entire business. But it always have a limitation since not all the consumers will behave in a same way for a single product which again does not tell us what the consumer is thinking about the product in terms of making decision in buying the new product. The term Segmentation is very important in marketing a new product since it allow the manufacturers to create more effective manner to meet the market needs. For Example: Apple Mac Pro is a very light weight, portable, high configuration and very stylish model which created a new definition for slim model in the market When we are seeing the above product it is clear that the product is appealing to a particular segment in a diverse laptop market, since it is a new product firstly the people should be comfortable in using the technology and challenging it. Secondly the consumers should be needed to adapt to the new technology to enjoy its usefulness. This is most likely to be used by the modern generation than the baby boomers and X-generations. The price is also another major factor, since it plays the major role in segmenting the potential group where there is more disposable income to spend. 2.2 Product Development Process There are various methods involved in developing a product and there are also many product development models also available. In this paper we are going to look at the conceptual design process it and apply it model to design the new Apple Laptop computers to meet the current generation requirement

The above mentioned method is one of the easiest processes used for product development as begins with the evolution stage where there will be many ideas are proposed in which some might be accepted and some might be rejected. Once the initial stage is done the product will go for the detailed engineering for the process of potential where the initial evaluation is passed will then move on to a more detailed engineering process of design and evaluation prior to a potential production. Evaluation is done in different stages of the product development to make sure the product is developed in such way it should be commercially sound as well as it should meet the requirement of the market or the consumers. Taguchi robust design hierarchy is the similar system for the above mentioned process (Anderson Dale O, 2001). Bench marking is the first stage of the product development where the research data collection and the information about the potential product which is nearing to provide the similar solution were analysed and bench marking was fixed for the unique product development (Hooley G J; Saunders J A; Piercy, 1998). This process tell us that before developing any new products it is very important for the supplier to study the existing product which is similar to this category in the same market for the better development. The research data which are collected should be categorized in to different groups and values are given for the different features which should be averaged to give a statistical data. If our target market is a mass market then the score of the newly developed product should be matched with the average of the analysed data, For Premium product it should be much higher in contrast for budget it has to be very less (Anderson Dale O, 2001). The important thing to be noticed in this analysis is the development of the product specification, characteristics and the quality level. The external physical state of the product comes as the next stage in which the durability and reliability is studied and it is decided according to basis of the product. This study will give the idea to the company whether the current level of technology is suitable or they need to change the physical structure of the product for the new one.

For Apple their major strength is their technology advancement and the realization of the electronic engineering and the software innovation plays as the key core competence. The analysis will employ an easy production approach, which may include the identification of product already in existence in order to adapt and adopt their use to meet the mandatory performance levels. The existing 1evel of technology can be recognized and the use of a power required analysis in the process can also be identified (Anderson Dale O, 2001). Parametric study will be the next step to be considered. In this the step the data collected in the initial stage and the benchmarking tables are used to analyse the current trend in the market which will help the company to examine whether they are moving in direction in the product development or not. This will also provide the opportunity to company to compare the characteristics of each product in the current market. This will result in the better design for the new product. According to Anderson Dale O. (2001) & Hooley G J; Saunders J A; Piercy, (1998), in their study they explained about the products which provide similar solutions with different sizes. This case was studied to review the different features of the variable size products for scaling purpose, in terms of scaling up and down. Geometric scaling is the next step followed in the product development since it simple as we speak but when comes to functionality, the size will restrict the internal organs of the machine which may reduce the performance too. Another famous method used during the product development is Pugh Concept a table format which will be filled with the different version of the similar product to examine the performance of each and comparing the expected performance from the newly developed one. If the examination shows the plus sign indicates the above expectation level and minus sign will shows the below expectation level. Most of the supplier will choose positive sign design or least negative sign design for the better development of the product. Puge concept is one best tool to be used in this concept stage since the flaw is very less and very easy direct comparison tool available in the this developmental process.

Its quiet achievable that there is the prospective utilizes of this tool to propose a new design that is the fused form other designs. However this would then have to be fully evaluated to re reach the current stage (Anderson Dale O. (2001), Mintzberg H, Quinn J, Goshal S, 1998). Decision matrix is the next tool used, which will help to cross check the entire development process from the initial stage to the final stage to come to the final decision about the product development in terms of matching the requirement. This is a system that allows for the use of various tools, all of which are designed to assess different aspects of the new product, form the concept and desired characteristic to a comparisons with those on the market that may be desirable and the way there may be a 'borrowing' of technology or design concepts for exiting products. The application of these may all help Apple indicate which areas are important and which are not and how value may be added to the product etc. (Thompson J L, 1998) 2.3 Monitoring and Controlling For every successful products monitoring and controlling plays a very major role, which is normally done by controlling the input and monitoring or testing the outputs regularly. Testing is not restricted for initial stages alone it has to be done continuously throughout the product lifecycle in longer term because of these products nature. Constant feedback should be noted from the consumers to understand the weakness of the product which can be utilized for the future development and also we can assure the customer satisfaction. This tells us that it is necessary for the supplier to proactively look for different sources for monitoring and collecting information and analyzing it. Conclusion: From the Review we can indicate that how the marketing strategy can be used for the specified target market since the younger generation mostly interested in internet than the daily news papers and day time television programs, hence segmentation plays the major role in not only developing the product but also gives the idea about effective communicating strategy for their target market. This study also reviewed about the product development process like determining

and understanding the requirement, its design specification to the completion stage. Finally this literature concluded with the controlling and monitoring of the newly developed product. The ultimate aim the study is achieved by satisfying the customers new needs and the market share Of Apple also increasing constantly is a clear evidence for their success. References
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