Marketing Strategy and Competitive Positioning pdf ebook

Figure 7.5 
Levels 
of segmentation
Strategic
segmentation 
Strategic intent, vision
and mission
Marketing planning,
budgeting and resource
allocation
Operational sales, marketing
and distribution management
Managerial
segmentation
Operational
segmentation

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IMPLEMENTING MARKET SEGMENTATION
Piercy and Morgan (1993) attempted to catalogue the sources of implementation failure 
with segmentation-based strategies, and these issues provide a further screening device 
for evaluating the suitability of a segmentation model generated through market research. 
Issues to assess include the following:
● 
Organisation structure: companies tend to organise into functional departments and sub-
units of one kind or another, depending on their task allocation and how they deal with 
the outside world. A customer-benefits approach to establishing market targets may cut 
across these internal divisions – they may not ‘fit’ with the jurisdiction of departments 
or regional organisations for sales and marketing. Segment targets that fall between 
departments and regions may be neglected and lack ‘ownership’, and the strategies built 
around them will fail. We need to map carefully how segment targets will match the 
internal organisation structure.
● 
Internal politics: Young (1996) argues that strategic segmentation is essentially a cross-
functional activity, requiring expertise and involvement by many functional specialists. 
If functions cannot collaborate or work together because people are vying for power and 
withholding their knowledge and expertise, the segmentation strategy is likely to fail. 
If our segmentation-based strategy relies on internal collaboration and cooperation, we 
need to be sure this can be achieved, or the strategy will fail.
●