Know-How Exchange : Student Questions

Jon,

Let's think through this. Let's skip Reebok for a second and go to something much simpler. Suppose you wanted to start a lemonade stand. Tell me the following:

1. A market segment is a subset of the entire world. You can break the market down any way that makes sense to you and your product - age, race, geography, income, sex, eye color, car preference, family size, and so forth. Versus just selling to everyone in the world all in one group, why would you want to break down the market into segments?

2What segmentation would be most appropriate for your lemonade stand?

3. Once you identify the segments, how would you rank them from a standpoint of most attractive to least? What makes a segment better than another?

4. For your lemonade stand, which segment(s) would be more attractive? Why?

Now, let's go back to Reebok. No, you don't know their strategy - for certain. They don't publish it on the bottom over every shoe box or anything. However, you've been to a shoe store. You've seen ads. You can go to their website. Based on that, what do you think is their targeting strategy? What makes you think that? Why do you think they target at all? Why not go after the whole world versus targeted segments? And finally...why do you think they chose the target they did? How does this benefit the company?

I hope that helps. If it does, please acknowledge that you get it. If not, please give some answers to the questions above and ask further questions.

Wayde