Segmentation/Target Market Strategy

Segmentation/Target Market Strategy

Market segmentation is the division of a market into different groups of customers with distinctly similar needs and products or service requirements (Croft, 1994). Its major purpose is to pull scarce resources and ensure that the elements of the marketing mix, price, distribution trends, products and promotion are premeditated to satisfy the particular needs of the different customer groups. City Grill’s main approaches to market segmentation, could include using the breakdown method where they can view the market as to consist of consumers who are in essence the same, having similar tastes, and so forth. Their duty could only be to identify groups which share particular differences. Alternatively they could use the build-up method. In this method they will have to consider the market as to consist of consumers who are all different. Their task in this approach will be to find similarities.

City Grill being a restaurant, serves the food service sector of the market, and provide steak as their main menu item. In order to serve this segment effectively they have employed various market segmentation techniques. Among these techniques are: demographic segmentation, geographic segmentation, behavioral segmentation, psychographic segmentation, and price segmentation.

In segmenting the market demographically, they have used measurable characteristics, such as age, gender, and occupation. With their intent to serve the food services market effectively, they have located themselves in the Central Business District of Melbourne city. This is a strategy to target the working class. Their prices are also relatively high meaning they intend to specialize on the middle working class to the high working c...

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