CHINA MOBILE

Case Study on China Mobile Grows Through Segmentation

Case Study on China Mobile Grows Through Segmentation

Answer 1)

Market segmentation is the process of breaking down the total market for a product into distinct subgroups or segments where each segment conceivably represents a separate target market to be reached with a distinctive marketing mix. Markets are rarely simple—they consist of a variety of buyers with disparate motives and backgrounds, different needs and wants. Additionally, markets get affected by disparate macro-environment factors. As such, markets are rarely homogeneous. Segmentation can be summarized as dividing a market by a set of predetermined criteria. However, doing so overlooks the key fundamental of what segmentation should be used for—to gain customer insight. Truly understanding the needs of potential and actual customers in a market allows a company to segment along the lines of needs—needs it can serve, needs it cannot, needs it wants to serve. The concept is to segment only using variables that having meaning in the context of the company and market it is operating in, not just jump feet-first and use the traditional approach (Rust, 2004).

Psychographic variables take this a step further and segment on lifestyle, attitudes, personality, and values as a whole. However, it involves the demographic aspects along with the psychological approaches. Psychographics began in the mid-1960s and has now grown to rely on original and syndicated research from major research companies, such as Mori and Nielsen. Psychographics widely used in consumer markets and is the link between the basis for positioning and segmentation (Rust, 2004).

China mobile focuses on market segmentation to be as much effective with their segmentation strategy as possible. They have further classified the segmentation into three categories of understanding their customers in the most effective way. This strategy is effective in the Chinese market because of the enormous market size. Therefore, it is relevant approach to tackle the scenario by classifying and focusing on sizable chunks of the overall market and highlight their different target audience (Wedel, & DeSarbo, 2002) (Berger, 2001).

Answer 2)

China mobile tends to produce strategies that are of most relevance. Similarly, their strategy of keeping the value-added services intact even in the rural areas for the farmers who do not even get any other cellular service other than china mobile. Hence, an old school though for such a situation will be of catering to their market by thinking about the monopoly and ...