What is Consumer Segregation?

            Consumer segregation is the process by which customers are divided into different groups with people who fall under the same characteristics are based in a similar group. These groups are based on gender, age, common interests and habits (Shanmugasundaram, 2008). This process is also called customer segregation or client segmentation.

            Different companies normally enjoy customer segmentation due to the fact that customers are unique and different (Meyler et al, 2013). It is also evident that marketing would be efficient if the target group is smaller and specific. Consumer segmentation is also critical in ensuring that companies have in depth knowledge and understanding of what their customer preferences are; in order for them to know that which is most valuable for each segment of people (Meyler et al, 2013).

            Customer segmentation also allows marketers to identify the products that the new or the existing customer may be in need of and provide them thus gaining competitive advantage over other marketers in the same industry (Shanmugasundaram, 2008).. An example is the beauty and cosmetic industry where there is consumer segmentation and the companies are able to produce products specifically for ladies, others for men and others for the children.

The last importance of customer segmentation is based on the absorption of the purchasing power. This is achieved by price differentiation where developing premium segments that make customers comply with the higher prices level. These segments might be different from mass market by certain features such as exclusive services, additional points of sale and brands variations and others. Therefore, it is factual that marketers are given the power of absorbing the purchasing power of the customers thus giving them the price differentiation advantage. Additionally, this promotes price elasticity in the market which is the other advantage to the marketers since they can derive higher profit margins from their products.

References

Meyler, K., Fuller, C., & Joyner, J. (2013). System Center 2012 Operations Manager unleashed. Indianapolis, Ind: Sams.

Shanmugasundaram, S. . (2008). Customer relationship management: Modern trends and            perspectives. New Delhi: Prentice-Hall.