Every company and organization are out there to increase their profits as well as reducing the cost of operations for it to increase value for its shareholders. However, to increase their profits, they need to increase their sales by gaining more customers base and market share. The only way to achieve this, it is through proper and appropriate marketing strategies. Marketing is a form of communication between the business and its target and existing customers with the goal of selling the organization products and services. The marketers have to communicate the value of the organization’s product or service to the customers. However, in today’s scenario, the ever changing needs and wants among the customers leads to a paradigm shift in marketing. This is due to the changing attitude and behavior of the customers and globalization. On the other hand, one of the key factors in marketing is market segmentation which is a process of dividing the product and service market up to different customer segments. Market segmentation is very important to any company that has the willingness to penetrate the market. Examples of the basis that are used for segmentation include age, level of income, geographical position, and gender (Wedel, 2012 pg18). This paper seeks to describe and explain market segmentation of the Chevrolet Camaro.
Chevrolet Camaro marketing strategy
Part 1
Chevrolet is one of the world’s best-renowned motor companies that sell its products all over the globe. However, the company has a unique marketing strategy that makes it undisputed champion in the motor and truck market ahead of other giant companies such as the general motor. In addition, the giant motor company has successfully segmented its motor and truck on the basis of geographical position, demographic basically based on gender and age and psychographic. Through segmentation, the company has been able to match the customer’s needs better by producing exactly what a specific market segment needs and desires. Moreover, the company has also increased its competitiveness through focusing on a specific market segment rather than focusing on the entire market as well as expanding its markets. One of the fundamental principles that Chevrolet Camaro has effectively utilized in market segmentation is to maximize the similarities within each market segment and to maximize the differences in the products and services they offer between two different market segments (Wilkinson, 2013 pg 45). The pie chart below shows the market segmentation implemented by the company to win over customers.
From the pie chart above, it is easy to detect that demographic segmentation carries and occupies the large and bigger market size than the others considering that the population of the globe is close to 7.4 billion. In addition, the company gives priority to market segment based on the geography and the size of the globe which is close to 510 million km2, and it has to cover almost every corner of the world. Finally, the company has also segmented its market on the basis of psychographics which is a bit lower than both demographics and geographic.
Demographic market segment
In recent years, Chevrolet Camaro has become popular, and every individual ranging from organizations and households since the company is one of the most liked Sports Car Company in the United States. Demographics is a process of studying a population based on factors such as age, race, and sex. On realization that customers of different ages and sex have different tastes and preferences, the giant company decided to segment its market on the basis of sex and age. In the universe today, the highest composition of the population is made up of youths and thus, this presents an opportunity. Chevrolet Camaro has manufactured a car the right model of a car that suits the youths because of its speed, has an air conditioner and a cool music system. Most of the youths between ages of 18 – 30 love Chevrolet Cruze as it contains all the features and characteristics that the youths want. In addition, the company has gone on to produce other models that are suitable for older people between the age of 36 – 60, and the business-minded people which are fuel efficient and perfect for the family and low earners like Chevrolet Spark and beat (Füller, 2008 p 120). Moreover, the company has produced unisex motor models that can be driven and accepted by both males and females despite most of the vehicles suiting the males. In Chevrolet Sail, the company has produced a unisex car model for all interested parties. Through this segmentation, the company ensures that people of all ages and genders are covered and have something to be proud of.
Geographic market segment
Geographic is another feature the company has utilized to divide its market. Geographic is concerned with the geographical location and the characteristics associated with each region. Considering that the earth is so big to cover at once, the company has divided the regions based, income level and the living standards. Other continents are far much developed than others, and thus, the developed regions can afford to buy high-quality motors that consume fuel at a very high rate. Moreover, the living standards and income level is another base that has been used considering that high-income earners have more than enough to spend on their basic needs and have extra to spend on luxury motors. Thus, the developed continents and regions recording the highest number of high-income earners will get expensive vehicles than regions with low-income earners. This difference in the quality, size and prices of the motors is to ensure that everyone is covered ranging from high-income earners to low-income earners. Basically, the company concentrates on big cities where the population is high and has high-income earning individuals who can afford the luxury of owning vehicles.
Psychographics market segment
There are those customers who always like to have a product or a service that is largely based on their lifestyles. To these customers, the company introduced series of fancy motors for rich individuals who fancy stylish lifestyle. Psychographics involves the study and classification of the market on the basis of attitudes, aspirations, and lifestyle (Menzly, 2010 p 1560). To apply this technique, the company had to collect data on the customers before embarking on the production process. For example, the company discovered that the youths and the rich always desire to have flashy cars that make them feel special among their peers. Moreover, to satisfy this market segment, the company introduced motors that were categorized on the basis of classes ranging from the upper class, middle class to lower class. The upper-class motor is sold at a high price to satisfy the egos of the rich in the motor market.
Part 2
Each market segment contains different market futures and characteristics depending on the segments itself. However, this does not mean that two market segments may not have closely related characteristics. Below is some of the market characteristics associated with above-discussed market segments:
Characteristics of demographic market segment
- Focuses on specific gender – it is widely known that the population is made of two genders, the male and the female who have very different needs and desires thus, the company needs to focus purely on the tastes of men separately and the tastes of the ladies separately. However, in recent days, there is an emerging trend where women are developing a taste for male big cars which were associated with male and thus, the company needs to produce unisex motors that can be used by all genders.
- Focuses on the age – people of different age have different tastes and preferences. The youths between the ages of 18 – 30 are known to fancy big and expensive motors making them a perfect target market (Dolnicar, 2007 p 129).
- Family size – Moreover, this market is also divided on the size of the family considering that there are those individuals who like traveling a lot and on the other hand there is that market of family men who have to go with their families to different places.
Characteristics of geographic market segment
- Focuses on a city or state – a geographical segmentation primarily focuses on cities and states that have same characteristics or are located in the same region to reduce the cost of transportation of the final product to the target customers. Usually, cities are grouped on the basis on the size of the population to ensure that the company gets every single consumer.
- Focuses on the countries in the same region – for the geographical marketing to be effective, the company focuses on the countries in the same region and group them together to have a common outlet or a distribution line. Usually, countries that have the same characteristics regarding area and population may have a similar marketing strategy.
Characteristics of psychographics market segment
- Focuses on the income level of the population- this market segment is usually created to satisfy the needs and desires of that section of the population that have extra cash to spend on fancy motors and are in a position to purchase expensive gadgets to pimp their cars.
- Focuses on the lifestyle – people have different lifestyle depending on the kind of life they are leading. This segment groups these individuals in the same category and produces products that are in line with their lifestyles and class (Loveridge, 2012 p. 69).
A good marketer should always be aware and conversant with some of the factors that may cause a shift in the demand for a product which are widely referred to as demand drivers. In most cases, these drivers are divided into two negative and positive demands drivers or shifters. Below are some of the positive demand shifters that can increase the demand for the Chevrolet Camaro.
- The number of customers – a change of population let us say an increase in the total number of population in a country and the globe, in general, is likely to raise the total demand of the Chevrolet Camaro motor vehicles prompting the company to embark on a massive production of the vehicle.
- Changes in income – the level of income of individuals keep fluctuating from time to time and an increase in the level of income of an individual means that he or she will have enough money to spend on basic needs and save enough to spend on fancy and expensive motor cars. Thus, increasing the demand for the motor vehicles in the globe.
Part 3
Chevrolet Camaro market share
However, despite all the efforts put by the company, there is still a market that is not tapped out there that needs to be tapped to increase the market share. Despite desiring to tap new markets, there is still a chance of getting and segmenting the Chevrolet Camaro market further into a behavioral segment. Behavioral segmentation involves dividing the market into groups based on their knowledge, attitudes, uses and responses to the product. The company should try to tap the first time users who come to the company without any knowledge of the products provided, and the company has to advise the users on the best vehicle to go for. Moreover, the company should consider consumer population based on the relationships to the company products who are widely regarded as the loyal. This segment of the market comprises of existing customers who are loyal customers of the company who may want an upgrade of a change of the model of the motor they are using right now (Füller, 2008 p. 122). After conducting research to determine what the customer feel about our products, it emerged that most customers wanted the company to take the company to the next level by producing motor car accessories and spare parts that are related to our product.
Through the production of motor related accessories associated with Chevrolet Camaro such as engines, seat covers, side mirrors and brake systems, the company can tap this new market as well as attracting new customers who might be interested in buying car parts. By introducing these products and tapping this new market, the company stands a better chance of increasing its competitiveness as well as increasing productivity and thus profits for the company.
References
Dolnicar, S. (2007). 8 Market Segmentation in Tourism. Tourism Management: Analysis, Behaviour, and Strategy, , 129.
Füller, J. &. (2008). Customer delight and market segmentation: An application of the three-factor theory of customer satisfaction on life style groups. . Tourism management, 29(1), , 116-126.
Loveridge, R. &. (2012). Theories of labour market segmentation: a critique. Springer Science & Business Media.
Menzly, L. &. (2010). Market Segmentation and Cross‐predictability of Returns. . The Journal of Finance, 65(4), , 1555-1580.
Wedel, M. &. (2012). Market segmentation: Conceptual and methodological foundations (Vol. 8). Springer Science & Business Media.
Wilkinson, F. (. (2013). The dynamics of labour market segmentation. . Elsevier.
