Course: MAR 100-B050 | Intro to Marketing | Professor Buckler | Fall 2022

Segmentation Discussion

You must be logged in to reply to this topic.

  • Author
    Posts
    • #14706

      Brielle Buckler
      Participant

      The process of dividing a market into meaningful, relatively similar, and identifiable segments, or groups, is called market segmentation. The purpose of market segmentation is to enable the marketer to tailor marketing mixes to meet the needs of one or more specific segments.

      There are several reasons an organization may decide to target their product(s) and/or service(s) to one or more segments of the population. You can read more about each of the reasons listed in our Course Materials for this unit

      For this assignment, work through this simulation which is part of this unit’s Course Materials. Imagine you are an entrepreneur working to building your house-made ice cream business. Based on what you’ve learned, choose a path to improve marketing efforts.

      Explain how the path(s) you’ve chosen successfully (or unsuccessfully) gets your message to your target population, and what effect your marketing had on ice cream sales.. Then, speak to the segmenting variables that you considered for this product/service (ex: geographic, demographic, etc.). Why do you think your method was effective or not?

      ———-

      In order to receive full credit for this assignment, all components of this assignment are due by 11:59pm ET on Sunday, November 27, 2022. You should first contribute a thoughtful post of your own before viewing/commenting on the posts of others. You must respond meaningfully to at least two classmates to receive full credit for this assignment.

      This assignment is worth a total of ten (10) points — 6 possible points for your original post, and up to 2 points for each of the two responses to your classmates’ posts. Students should review others’ submissions and comment meaningfully (refer to this guide from MMSU for reference) to at least two other students. For reference, here is the difference between a comment and a post — you will be using both for this assignment. Make sure to refer to our Discussion Rubric as you work on your submission.

    • #15541

      TerriJ
      Participant

      Segmenting the Ice Cream Market

      Scenario/Goal – Let’s say you own an ice cream shop where you make your own delicious flavors. You’ve got a pretty good base of regular, local customers. But you want to bring more people into the store.

      Over the last year – with no formal marketing – your ice cream shop made an average of $17,459 in revenue a month, which pays you, the owner, $4015 .Your goal is to get more people into your ice cream shop.

      What I chose to do

      I first decided to conduct some research on segmentation and targeting. I wanted to get a better understanding of my customers. I decided to research my customers by demographic and geography. I learned that the people who came to my shop as families bought more ice cream than those who came alone or with friends. I also learned that the people who lived and worked close to my store are the ones who most visited.

      With this information, I decided to segment by family status and targeted families. I reasoned that since families are more likely to buy more ice cream when visiting the shop, and kids are more likely to crave ice cream, targeting families would bring more frequent paying customers.

      Outcome – You decide to market to families. To do this, you sponsor a few local school sports teams during the off-season. You provide the ice cream for a few school socials. And you sponsor the summer tennis matches and a few sailing teams.

      As a result, you get a boost in family traffic. Your average monthly sales go from $17,459 to $21,076, a boost of 20.72% percent.

      Competition – A competitor opens an ice cream store in another part of town and markets to “food lovers” with the quality of their ice cream. This impacts you significantly, reducing your average monthly revenue by more than 17.7%. Based on your experience, on which segment do you want to focus to combat this?

      What I chose – I chose to continue to target families. As I believed it was better to have a solid foundation (aka loyal customers) than try to appeal to everyone.

      Outcome – You better target and serve families. Now your revenues are up 6.58% instead of down 17.7%. Now what do you want to do?

      What I chose – Going back to my previous research, where I learned that people who lived and worked close to my store visited the most, I decided to also focus on people who are close to the shop. I believe that focusing on people who were close to the shop would be profitable because due to the close proximity, they would most likely return, and had higher chances of being regular customers.

      Outcome – The combination of focusing on people who are both close and come with their families result in revenues that are +21.23% over your revenues before the competitor came in. And you have heard stories that the competitor will be leaving town soon.

      Conclusion – This is an outstanding outcome. You can try again, but you are not going to do better than that.

      Why do you think your method was effective or not?

      I believe my method was affective because I first did research to learn more about my customers and tailored my decisions to them. I focused on attracting more of the same audience instead of trying to attract a different demographic. While there is nothing wrong with expanding the target audience, it is always a gamble. So I believe I took a much safer route by focusing on attracting more of the customers that were already visiting my shop and spending their money.

      • This reply was modified 1 week, 1 day ago by TerriJ.
      • #15579

        Allison
        Participant

        Set the scene:

        I am an owner to an Ice Cream Shop, the ice provides locals with fresh home made ice cream. My issue is that I want to bring in more customers to my shop. My ice cream shop brings in on average a $17,459 in revenue a month, on average I take home $4,015. I want to increases my sales monthly. ….. What do I do next?<span class

        Next:

        I have to decide what approach I want to take to get to my end goal of increasing monthly sales. I choose to focus on the demographic aspect of my business, meaning I have to find out what type of costumers come to my shop. I create a 5 question optional survey, for people entering the shop, so I can get an insight on the type of customers coming in. Two months later, I find out that my most common customers are families, with younger children.

        Then:

        My attempt to fix this issue is; since the end of the school year is approaching for the elementary kids, I offer myself to the surrounding schools to give out ice cream on field day, I do this because both parents and kids will be offered my ice cream and everyone is local. In hopes of bringing them into my shop after these end of the year events. I will create an experience for families in my ice cream shop, by bring in a bunch of family fun board games that can be played while eating ice cream.

        Effect:

        This was a successful way of marketing and tasing sales. Towards the end of the summer we see the sale revenue raise from a roughly $17,000 a month to roughly a 21,500 monthly revenue, making my marketing decisions successful. Since my main focus for this marketing process was increasing the demographics, which in this case were specifically families with little kids, my approach was successful. I think this because since my focus was on the experience people can have at my shop was a priority, and I truly believed in the flavors I provide, making this a successful marketing approach.

        • This reply was modified 1 day, 8 hours ago by Allison.
      • #15580

        Alex Lopez
        Participant

        Hello Terri, I like the way you formated the responses and outcomes, I enjoyed reading through what somebody else did, it seems that it worked out well for you in the end as you met the goal of increasing profits by 20%

      • #15582

        Allison
        Participant

        Hi Terrij, Thank you for sharing your response with the class. I think your idea was a good one, sponsoring local sports teams. Now the only thing with that that I question if it will actually work in real life, since its a sports team, and they are doing sport, which is a healthy thing, I feel like it negates the purpose of doing sports and and having ice cream sponsor the team. But other then that your creativity for this assignment was great.

         

      • #15634

        Ivan Ramos
        Participant

        Thanks for posting Terrij

        I think families are key customers for most companies, especially small businesses like these. It’s good to see businesses gain the loyalty of families by appealing to all ages and hosting family friendly events. Focusing on people who live and work in the area was also a good call to make. I think that is essential to driving up sales, returning customers and staying in business longterm. Thank you

      • #15640

        Germain Soriano
        Participant

        Hello Terrij,

        Your response is neatly organized and easy to follow, so I was able to read your response quickly.

        I also went with the family route for similar reasons. Families will spend more due to everyone in the family wanting to enjoy ice cream together. However, I didn’t focus on those living nearby, but I felt I should have because you achieved an outstanding outcome and earned regular customers.

    • #15563

      xue,wang
      Participant

      What would you like to do?
      I first decided to conduct some research on segmentation and targeting.Because I want to know about the customer group, the location and the ability to consume.

      How do you want to segment the market?
      Then I choose Demographic ;segment by age,family status,and income ,and I found that the family purchase rate is much higher than that of friends or alone,and have money is generous.

      What do you want to do?
      Target families, You decide to market to families. To do this, you sponsor a few local school sports teams during the off-season. You provide the ice cream for a few school socials. And you sponsor the summer tennis matches and a few sailing teams.
      As a result, you get a boost in family traffic. Your average monthly sales go from $17,459 to $21,076, a boost of 20.72% percent.
      (You have unlocked the bonus section.)

      I think my method is right, because I think the main crowd is families. Children like ice cream, and parents will buy it for their children, and they will also taste it. I think family sales can be greatly improved, because There is a lot of traffic in the family outing area, plus the sponsorship of school sports teams. Both games and competitions are popular areas, so I think this is a relatively stable choice.

      • #15583

        Allison
        Participant

        Hi Xue, Thank you for sharing your response with the class! I think you did a job in choosing to aim increasing of flow for families specifically, since I genuinely think its the best approach one can choose.

         

        • #15590

          Besnik Shakiri
          Participant

          Hi Xue, I enjoyed the methods you chose to segment the market and conduct research to see an increase in your shops revenue. I would suggest taking into consideration other factors as well to exceed your expectations for future growth! overall great job.

      • #15620

        Amit Roy
        Participant

        Hi Xue,
        I like the choices and approaches that you made how the children like the ice cream and parents will buy it for their children and there is a lot of traffic in the family outing area and I also think that is the safest way to go and do business.

        Thanks
        Amit,

      • #15647

        Cramsahai
        Participant

        Hi Xue Wang, I like the approach you took. The strategies you took were promising to your business in the end. I think the segment you choose to follow up on was wise and did help you to get your business booming.

    • #15569

      Alex Lopez
      Participant

      Scenario- Let’s say you own an ice cream shop where you make your own delicious flavors. You’ve got a pretty good base of regular, local customers. But you want to bring more people into the store.
      Over the last year with no formal marketing, your ice cream shop made an average of $17,459 in revenue a month, which pays you, the owner, $4015.Your goal is to get more people into your ice cream shop.

      I decided to go with “Conduct some research around segmentation and targeting” and had to decided between Geographic, Demographic and Behavioral. I chose Demographic to get a better insight of who my customers are instead of loyalty or people’s status. Turns out that people with families tend to spend more, and people with more money then others would spend more. I decided to go with targeting the well-off people as I think that people with more money can sometimes be nice and buy ice cream for others, or buy their entire family a ice cream at home.

      “You sponsor events at the local private school and yacht club.” I would have gained a 37% boost in revenue, but since I left the other customers without any events or giving back, my revenue only ended up being up 5.52%

      I think my method was not as effective as it could have been, if there was a option to balance between doing events for richer people and the rest of the community, the profits would have turned out massive. Regardless the option I chose was a little effective as I gained a 5.52% increase. Doing something like giving students who show a school id get a tiny discount on certain days, or doing a raffle for a gift card, and to enter you would have to purchase ice cream.

      I then decided to try again and this time i chose to invest $1000 into the local free newspaper, to which the effect helps increase monthly revenue by 12.19% I then chose to dig deeper into it, and wanted to do a survey about who goes to my shop and how much they spend while there. I notice that anyone with a pet tends to spend less.I focus my advertising budget in the food section of the newspaper, which helps increase my revenue up from 17,459 to $21,135 or 21.05%.

      A competitor opens up a ice cream shop of their own, which decreases my revenue by 17.7% I choose to focus on food lovers, as this is the group of people this store tries to focus on so bringing back some of those people will help drastically with competition, it ends up making my revenues only down 11.6%, I decided to focus on families as well which brings up my revenue to +14.46% pre-competition which drives the competition away.

      I think this was much more effective, but It wasnt enough to meet the 20% increase in profit which I felt was due to things like a changing market and having competitors move in, if they did not move in, profits would have maybe reached above 20%.

      • #15631

        yangi
        Participant

        hi Alex,

        I agree with focusing on demographic however I don’t agree with focusing on people with high income because you wouldn’t really know your customer’s income on the basis of how much they spend in your store and just because they are well off doesn’t mean they are going to spend more except for the sponsored events you mentioned.

        • #15633

          Saleema Haniff
          Participant

          Hi,

          I share the same view in regards to demographic, however, I too disagree with focusing on people with high income. Having a high income does not necessarily mean that those people will buy your product. Yes they can afford it , but it does not mean they want it. It can be older people who may be rich but cannot eat ice cream for health reasons or it can be young persons who have a high income but do not like ice cream. Hence, having a high income does not necessarily mean more customers.

      • #15652

        katellyn ahuatl
        Participant

        Hi Alex,

         

        I see that you came across some minor disadvantages when you choose to target the high income people. I would have to disagree because I don’t think the income on others should depend on who walks into your business. As a business owner you should be aware that all level of people should be welcomed. I do see that overall you ended up with catering more to families and that was a smart move since we know icecream is more attractive to them . As a business owner it’s nice to gamble your options but you must be aware of the consequences. We learn from them and grow. Overall it was nice to see how you bounced back as a business owner.

    • #15570

      Leila J
      Participant

      <span data-preserver-spaces=”true”>As I Imagine, I’m an ice cream shop owner in this stimulation. My Ice creme shop has a good base of regulars and local customers, causing me to have an outstanding revenue of </span><span data-preserver-spaces=”true”>$17,459. </span><span data-preserver-spaces=”true”>While also wanting to increase my average monthly revenues by more than 20%. To achieve this goal, I would research Market Segmentation and target so I could know who would want to buy ice cream and whom it would appeal to. But Before I did that, I asked questions about people in the town where my ice cream shop is located. I wanted to know the percentage of families that comes to the shop. It was said that 30% percent of my customers are families. And There, I knew who my main customers were. So in the simulation, I chose to segment the market, and I decided to segment by age and family status. This method was effective because the information would tell me who my primary consumers are. And it was effective because The research suggested that people with families come to buy in my shop more than those who buy by themselves or with friends. Giving me an idea of who and who are not the best consumers.</span>

      <span data-preserver-spaces=”true”>The path I decided to take was to Target more families since they are my primary demographic. The effect of marketing to Families like sponsoring local school sports teams and providing Ice cream for school socials. My ice creme business monthly sales went from $17,459 to </span><span data-preserver-spaces=”true”>$21,076</span><span data-preserver-spaces=”true”>, with a boost of 20.72%. This helped boost my Business until later; a competitor opened an ice cream catering to</span><u><span data-preserver-spaces=”true”> food lovers</span></u><span data-preserver-spaces=”true”> reducing my Business’s average monthly revenue by more than 17.7%. In the simulation, I had to figure out which segment would help boost my monthly revenue. I knew that families were the primary demographic of buyers in my shop, and </span><u><span data-preserver-spaces=”true”>rarely</span></u><span data-preserver-spaces=”true”> people who buy ice cream alone. My best bet was to focus on families. After doing that, my revenues went up 6.58%. So as a business owner, Knowing Families are the ones to help boost revenues, I decided to focus and segment even more on families to boost my revenue. That business decision Helped increase my monthly revenues by 36.15%. Making my competitor go out of Business and making my ice shop a success. I think carefully thinking and asking questions like “what is the percentage of customers who visit my shop” helped because This can give you a better idea of whom you are already marketing towards, so you can pursue how you can gain revenue around a particular segment market</span>

      • This reply was modified 2 days, 1 hour ago by Leila J.
      • #15589

        Besnik Shakiri
        Participant

        Hi Alex,

        I think the methods you took to segment the market were overall effective for you to reach your goal. However taking other factors into consideration such as competition could of been more effective as a way to increase revenue for your own business. Overall good job.

    • #15572

      Leila J
      Participant

      As I Imagine, I’m an ice cream shop owner in this stimulation. My Ice creme shop has a good base of regulars and local customers, causing me to have an outstanding revenue of $17,459. While also wanting to increase my average monthly revenues by more than 20%. To achieve this goal, I would research Market Segmentation and target so I could know who would want to buy ice cream and whom it would appeal to. But Before I did that, I asked questions about people in the town where my ice cream shop is located. I wanted to know the percentage of families that comes to the shop. It was said that 30% percent of my customers are families. And There, I knew who my main customers were. So in the simulation, I chose to segment the market, and I decided to segment by age and family status. This method was effective because the information would tell me who my primary consumers are. And it was effective because The research suggested that people with families come to buy in my shop more than those who buy by themselves or with friends. Giving me an idea of who and who are not the best consumers.
      The path I decided to take was to Target more families since they are my primary demographic. The effect of marketing to Families like sponsoring local school sports teams and providing Ice cream for school socials. My ice creme business monthly sales went from $17,459 to $21,076, with a boost of 20.72%. This helped boost my Business until later; a competitor opened an ice cream catering to food lovers reducing my Business’s average monthly revenue by more than 17.7%. In the simulation, I had to figure out which segment would help boost my monthly revenue. I knew that families were the primary demographic of buyers in my shop, and rarely people who buy ice cream alone. My best bet was to focus on families. After doing that, my revenues went up 6.58%. So as a business owner, Knowing Families are the ones to help boost revenues, I decided to focus and segment even more on families to boost my revenue. That business decision Helped increase my monthly revenues by 36.15%. Making my competitor go out of Business and making my ice shop a success. I think carefully thinking and asking questions like “what is the percentage of customers who visit my shop” helped because This can give you a better idea of whom you are already marketing towards, so you can pursue how you can gain revenue around a particular segment market

      • #15584

        Alex Lopez
        Participant

        Hello Leila,
        I like how you explained that you wanted to know the demographic section of the simulation, and saw that at the end of your simulation you Increased revenue by 36% which is really high so I think you did really well.

      • #15611

        Syeed Salvant
        Participant

        Hey Leila,

        I like the reasoning behind your choices, especially while trying to find out the percentage of families that come to the shop.  This led to the rest of the simulation going well for you.

    • #15578

      Saleema Haniff
      Participant

      Segmenting The Ice Cream Market
      What would you like to do?
      I first chose to do some research to better understand my customers or potential customers. I wanted to know who my frequent customers are and how I can gain new ones.
      How do you want to segment this market?
      I then chose demographic segmentation, which is to segment by age, family status, and income. Through this segmentation, I found that people that came as a family purchased more ice cream than persons that came alone or with friends. Also, persons with a higher income can purchase ice cream more frequently.
      “ You decide to market to families. To do this, you sponsor a few local school sports teams during the off-season. You provide the ice cream for a few school socials. And you sponsor the summer tennis matches and a few sailing teams. As a result, you get a boost in family traffic. Your average monthly sales go from $17,459 to $21,076, a boost of 20.72% percent. “
      I think this is a great marketing strategy to gain new customers. All these events have children which is the main part of my costumer base. Appealing to them means I am appealing to their families.
      “ A competitor opens an ice cream store in another part of town and markets to “food lovers” with the quality of their ice cream. This impacts you significantly, reducing your average monthly revenue by more than 17.7%. Based on your experience, on which segment do you want to focus to combat this?”
      I decided to continue to market to families since I know that families purchase ice cream more. Children are generally ice cream lovers, therefore, if they crave ice cream their parents and siblings will more than likely indulge also. It helped to raise my revenue from down 17.7% to up 6.58%. It is not a great increase, but I am happy it went up instead of down. In combination with this, I decided to focus on people close to the shop. This is so because they are in close proximity and are more likely to be frequent customers due to this. This has raised my revenue to 21.23% over my revenue before the competitor came in. This resulted in an outstanding outcome which I am very satisfied with. I would continue to sponsor school and sports events are different locations to continue to build my costumer base and to market my product.

      • #15604

        Nabeel
        Participant

        Hello Saleema,

        I think you did a great job. I liked how you explained the steps and did research first to get a better understanding before choosing the segment.

      • #15650

        Cramsahai
        Participant

        Hi Saleema, I think your plan would indeed have worked, I really like the idea of sponsoring the supply schools and other extracurricular activities.  That was a good idea as it will help to promote your product and widen your market. I think it will definitely help to bump your business income if it all goes well.

    • #15588

      Besnik Shakiri
      Participant

      In the scenario that I am starting up my own Ice Cream shop, My ice cream shop made an average of $17,459 in revenue a month, which pays me, the owner, $4015 . My goal would be be to increase revenue by more than 20%. To do this , I will be conducting some research around segmentation and targeting for starters.
      To segment the market, I’d like to go with geographic, segment by where people live and work. I’d like to do this to get a better understanding of who my potential target audience is. Given all the research, Next I would spend on programs that would better target people walking distance from the store. This would create more foot traffic.
      By doing this (You spend $750 a month on some signs to better let foot traffic from some busier thoroughfares know where you are. This has a significant effect, improving your traffic by 17.36%, well worth the effort.)
      Unfortunately, This does not help me reach my goal of 20%.

      The next steps I would take: Starting over again. I would go back to segmenting the market.
      This time I would go by demographic factors to conduct my research. I would chose to target families given the statistics.
      Result: You decide to market to families. To do this, you sponsor a few local school sports teams during the off-season. You provide the ice cream for a few school socials. And you sponsor the summer tennis matches and a few sailing teams.

      As a result, you get a boost in family traffic. Your average monthly sales go from $17,459 to $21,076, a boost of 20.72% percent.

      Thus helping me reach my goal!

      • #15602

        Nabeel
        Participant

        Hello Besnik,

        I like how you explained your steps and tried different segments. You tried geographic and saw it did not work out and then tried demographic. You did a great job.

    • #15594

      Germain Soriano
      Participant

      <h5>Simulation: Segmenting the Ice Cream Market:</h5>
      Scenario: Let’s say you own an ice cream shop where you make your own delicious flavors. You’ve got a pretty good base of regular, local customers. But you want to bring more people into the store.

      Revenue
      : $17,459
      Profit: $4,015

      Before deciding who to market by business to, I informed myself about my potential customer base.  I learned that my customers:

      1. 35% are seasonal summer customers
      2. 30% are customers with families
      3. 13% are male who own dogs
      4. 11.73% are cat owners
      5. 3% are kids who need a spot to hang out

      This information allows me to more easily find who I need to segment my business to.  But before I can successfully steer my business to the most profitable group, I need to establish a goal.

      Goal: Increase your average monthly revenues by more than 20%

      With this goal in mind, I have an idea of who to tailor my business to, but I need more information. I decide to conduct research around segmentation and targeting so I can define my market and increase my sales. Since I informed myself about my potential customer base, and am aware that 30% are customers with families, I decided to conduct demographic research and learned that ”that people who come into your shop as a family buy more ice cream than either those with friends or by themselves”.  I decided to target families and after a marketing initiative of sponsoring local sports teams, my sales increased.

      Result: You get a boost in family traffic. Your average monthly sales go from $17,459 to $21,076, a boost of 20.72% percent.

      I increased my revenue and achieved my goal. However, a competitor opens shop and threatens my business.

      Scenario 2:  A competitor opens an ice cream store in another part of town and markets to “food lovers” with the quality of their ice cream. This impacts you significantly, reducing your average monthly revenue by more than 17.7%.

      ”Food lovers” is a niche market so my focus remained on families. My continued targeted efforts on families reversed the monthly revenue loss.

      Result: You better target and serve families. Now your revenues are up 6.58% instead of down 17.7%.

      Because families are a large percentage of my customers and has been been profitable so far, I specialized my ice cream business towards families. By selecting to specialize in families, I achieved:

      Result: You double your laser-like focus on families, and you end up increasing your average monthly revenues by 36.15%. Your competitor goes out of business.

      By carefully researching my market and demographics, I was able to exceed my initial monthly revenue goal. I chose to target the family demographic because my initial information revealed that 30% of my customer base were those with families. I then conducted research on segmenting and targeting so I can have more solid information to work with. My research revealed that my customers with families spent more than other customers. I concluded that families is the demographic I would market and specialize my business to. The families responded well to my marketing efforts and resulted in a monthly revenue increase of 36.15%. Overall, my method was successful because of the effective research and choosing the right target.

      • #15623

        Aumi
        Participant

        Hello Germain,

        I saw that you acquired additional information about your potential customers and, as a result, you conducted an accurate research. You analyzed the information carefully and took actions accordingly to reach success.

        The way that you break down the process and explained your outcome made me realized that you have good knowledge about the concepts we’ve been learning in this course. I hope to be able to learn more about them and used them as effectively as you did for this assigment.

    • #15597

      Nabeel
      Participant

      <span style=”font-weight: 400;”>Scenario- Let’s say you own an ice cream shop where you make your own delicious flavors. You’ve got a pretty good base of regular, local customers. But you want to bring more people into the store. Over the last year – with no formal marketing – your ice cream shop made an average of $17,459 in revenue a month, which pays you, the owner, $4015 . My goal is to get more people into your ice cream shop. </span>

      <span style=”font-weight: 400;”>What would you like to do? I first chose to conduct some research around segmentation and targeting. </span>

      <span style=”font-weight: 400;”>How do you want to segment the market? Then I chose to go with the demographic segment by age, family status, and income. However, people that come into the shop as a family buy more ice cream than those who come by themselves or with friends. Also people with more money spend more. </span>

      <span style=”font-weight: 400;”>What do you want to do? Target families. After I decided to market families. In order to do this you sponsor a few local school sports teams during the off-season. You provide the ice cream for a few school socials. And you sponsor the summer tennis matches and a few sailing teams. Then the results I get is a boost in family traffic. And my average monthly sales go from $17,459 to $21,076, a boost of 20.72% percent.</span>

      <span style=”font-weight: 400;”>I would say my method was effective because it was mainly about families. Families who go out a lot and have kids with them tend to buy ice cream for themselves as well for the kids. </span>

    • #15599

      Nabeel
      Participant

      Scenario- Let’s say you own an ice cream shop where you make your own delicious flavors. You’ve got a pretty good base of regular, local customers. But you want to bring more people into the store. Over the last year – with no formal marketing – your ice cream shop made an average of $17,459 in revenue a month, which pays you, the owner, $4015 . My goal is to get more people into your ice cream shop.

      What would you like to do? I first chose to conduct some research around segmentation and targeting.

      How do you want to segment the market? Then I chose to go with the demographic segment by age, family status, and income. However, people that come into the shop as a family buy more ice cream than those who come by themselves or with friends. Also people with more money spend more.

      What do you want to do? Target families. After I decided to market families. In order to do this you sponsor a few local school sports teams during the off-season. You provide the ice cream for a few school socials. And you sponsor the summer tennis matches and a few sailing teams. Then the results I get is a boost in family traffic. And my average monthly sales go from $17,459 to $21,076, a boost of 20.72% percent.

      I would say my method was effective because it was mainly about families. Families who go out a lot and have kids with them tend to buy ice cream for themselves as well for the kids.

      • #15610

        Syeed Salvant
        Participant

        Hey Nabeel,

        While doing the simulation we went down the same path and I agree with you when it comes to why families work as a good target audience. Families often go out together and if you market in that direction multiple families can become regulars at your establishment.

    • #15607

      Syeed Salvant
      Participant

      For my ice cream shop to bring more customers, I chose to research segmenting the market.

      Research

      First I chose to do research on what demographic of people were visiting my shop. Regarding who visited my shop most, seasonal summer people were at the top of the list at 35% and families came in at a close second with 30%.

       

      Decision

      I decided to market to families.  To execute this I sponsored local school sports teams during their off-season.  We provide ice cream for a few school social gatherings and we invested in a few sailing teams and summer tennis matches.

       

      Results

      By choosing to market to families the ice cream shop got a boost in families who would visit throughout the year.  The average monthly sales for the store went from $17,459 to $21,076 which is a  twenty percent boost.  Through our decision making our business has flourished and we decided to do some bonus research.

       

      Bonus Research

      A competitor opened up a similar ice cream shop on the other side of town and they market to food lovers, they’re able to do so because of their high-quality ice cream.  As a result of this new ice cream shop, we’ve been impacted negatively and our monthly revenue has dropped by 17.7%.

       

      Decision

      We decided to enter the food lover market and work with local dairies to improve the quality of our ice cream and it works but our revenue has only increased by 6.1% which leaves us down in revenue at 11.6% so we slightly adjusted our approach and combined are market research of food lovers and families and decided to introduce flavors that appeal specifically to a certain member of the family.</span>

       

      Results

      Our new approach resulted in an increase of +14.46% over our pre-competition revenue which unfortunately for our competition led to them deciding to move to another town.

       

       

      • #15621

        Aumi
        Participant

        Hello Syeed,

        I’m glad to see that most people took the right path in the simulation. I’m not sure if everyone did, since I haven’t read most of the posts, but so far the ones that I read were of people that succeeded in the assignment. It was very easy, but the only thing I struggled with was to write everything down in and organized way. I particularly liked the way that you organized yours. It’s easy in the eyes and I managed to read and understand everything in a less than a minute.

        • #15635

          Saleema Haniff
          Participant

          Hi,

          I also struggled with writing everything down in an organized way. You did a great job in doing so. I was hesitant to market to food lovers because i wanted to have my own customer niche, hence I stuck to marketing to families. However, you did have an increase in revenue also and were able to have the other business move by creating competition. Therefore, your strategy is also correct in my view.

    • #15612

      Amit Roy
      Participant

      Set The Scene-
      Over the last year with no formal marketing my ice cream shop made an average of $17,459 in revenue a month, which pays me, the owner, $4015.
      Goal-
      My Goal is to get more people in to the ice cream shop and I have to try to increase my average monthly revenues by more than 20%
      My Steps-
      Conduct some research around segmentation and targeting
      I segment the market by Demographic- segment by age, family status and Income
      By doing some demographic research and learn that people who come into our shop as a family buy more ice cream than either those with friends or by themselves. Also, the people with more money spend more.
      The next step we target families.
      I decide to market to families. To do this, I sponsor a few local school sports teams during the off-season. I provide the ice cream for a few school socials. And I sponsor the summer tennis matches and a few sailing teams.
      As a result, I get a boost in family traffic. our average monthly sales go from $17,459 to $21,076, a boost of 20.72% percent.

      Now The Bonus Section-
      A competitor opens an ice cream store in another part of town and markets to “food lovers” with the quality of their ice cream.
      This impacts you significantly, reducing your average monthly revenue by more than 17.7%.
      Based on your experience, on which segment do you want to focus to combat this?

      I choose the family segment to do the focus.
      I better target and serve families. Now our revenues are up 6.58% instead of down 17.7%. Now what do you want to do?
      Then I decide to focus even more on families.
      I double our laser-like focus on families, and I end up increasing our average monthly revenues by 36.15%. our competitor goes out of business.
      That’s how I reach my goal get more people and Increase average monthly revenue.

      • #15638

        Ivan Ramos
        Participant

        Hello Amit,

        I like your approach to segmenting the market by demographic, identifying who you will likely serve. Your sponsorship local school sports teams and providing ice cream for school socials is a great way to drive foot traffic and get the word out there about your business. Not to mention a great boost of sales. Thank you for sharing

    • #15613

      Aumi
      Participant

      <span style=”font-weight: 400;”>Market Segmentation</span>

      <b>Let’s say you own an ice cream shop where you make your own delicious flavors. You’ve got a pretty good base of regular, local customers.</b>

      <b>But you want to bring more people into the store.</b>

       

      <b>Over the last year – with no formal marketing – your ice cream shop made an average of $17,459 in revenue a month, which pays you, the owner, $4015 .</b>

       

      <span style=”font-weight: 400;”>The first thing that I chose to do was to set my goals. I wouldn’t be able to achieve anything if I didn’t have a clear idea of what my goals are. As usual, one of my main objectives is to get more customers into my ice cream shop. To that I added the goal of increasing my average monthly revenues by more than 20%. In order to accomplish that I decided to do some research around segmentation and targeting. I began to evaluate my clients by their behavior, since I thought that the perfect approach was to aim for loyal customers. However, I soon realized that there wasn’t any segment in this category of customers that I could work with to get more clients. For this reason, I continued my research aiming for the demographics, which includes segments by age, family status and income. The demographic research revealed that people who come into my shop as a family buy more ice cream than those with friends or by themselves. That’s why I decided to have families as my target population.</span> <span style=”font-weight: 400;”>To do this, I sponsored a few local school sports teams during the off-season. I provided the ice cream for a few school socials. And I sponsored the summer tennis matches and a few sailing teams. As a result, my shop got a boost in family traffic. My average monthly sales went from $17,459 to $21,076, a boost of 20.72% percent. Ultimately, I accomplished my goals of gaining more clients and increasing my earnings because I focused on my target market.</span>

       

      <b>A competitor opens an ice cream store in another part of town and markets to “food lovers” with the quality of their ice cream.</b>

       

      <b>This impacts you significantly, reducing your average monthly revenue by more than 17.7%.</b>

       

      <span style=”font-weight: 400;”>Based on my experience I continued focusing even more in my target market, families, to combat the competence. I better target and serve families. And now my revenues are up 6.58% instead of down 17.7%. I double my laser-like focus on families, and I end up increasing my average monthly revenues by 36.15%. As a result my competitor went out of business.</span>

       

      <b>Why do you think your method was effective or not?</b>

      <span style=”font-weight: 400;”>I believe my methods were the reason I ended up achieving a great outcome because I began by stating my goals. Once I had that clear, everything started falling into place. Since I wanted to increase my monthly revenue, I needed to get more clients. To get more clients it’s necessary to do some research and understand what group of people to target, having the target population, it’s time to apply the necessary changes to obtain more people from this group. As a result, I could focus on the things that were working for my shop, arrange better strategies that allow me to increase my popularity, fight the competence and create a stronger structure for my business.</span>

    • #15614

      Aumi
      Participant

      Market Segmentation
      Let’s say you own an ice cream shop where you make your own delicious flavors. You’ve got a pretty good base of regular, local customers.
      But you want to bring more people into the store.

      Over the last year – with no formal marketing – your ice cream shop made an average of $17,459 in revenue a month, which pays you, the owner, $4015 .

      The first thing that I chose to do was to set my goals. I wouldn’t be able to achieve anything if I didn’t have a clear idea of what my goals are. As usual, one of my main objectives is to get more customers into my ice cream shop. To that I added the goal of increasing my average monthly revenues by more than 20%. In order to accomplish that I decided to do some research around segmentation and targeting. I began to evaluate my clients by their behavior, since I thought that the perfect approach was to aim for loyal customers. However, I soon realized that there wasn’t any segment in this category of customers that I could work with to get more clients. For this reason, I continued my research aiming for the demographics, which includes segments by age, family status and income. The demographic research revealed that people who come into my shop as a family buy more ice cream than those with friends or by themselves. That’s why I decided to have families as my target population. To do this, I sponsored a few local school sports teams during the off-season. I provided the ice cream for a few school socials. And I sponsored the summer tennis matches and a few sailing teams. As a result, my shop got a boost in family traffic. My average monthly sales went from $17,459 to $21,076, a boost of 20.72% percent. Ultimately, I accomplished my goals of gaining more clients and increasing my earnings because I focused on my target market.

      A competitor opens an ice cream store in another part of town and markets to “food lovers” with the quality of their ice cream.

      This impacts you significantly, reducing your average monthly revenue by more than 17.7%.

      Based on my experience I continued focusing even more in my target market, families, to combat the competence. I better target and serve families. And now my revenues are up 6.58% instead of down 17.7%. I double my laser-like focus on families, and I end up increasing my average monthly revenues by 36.15%. As a result my competitor went out of business.

      Why do you think your method was effective or not?
      I believe my methods were the reason I ended up achieving a great outcome because I began by stating my goals. Once I had that clear, everything started falling into place. Since I wanted to increase my monthly revenue, I needed to get more clients. To get more clients it’s necessary to do some research and understand what group of people to target, having the target population, it’s time to apply the necessary changes to obtain more people from this group. As a result, I could focus on the things that were working for my shop, arrange better strategies that allow me to increase my popularity, fight the competence and create a stronger structure for my business.

      • #15617

        Amit Roy
        Participant

        Hi Aumi,
        I see that yours method was effective as as you stated that you have clear goals and to increase the monthly revenues you need more clients and to get the clients you do need to get done some research and what group to target I like your approach that falls things right into the places.

        Thanks
        Amit,

      • #15629

        yangi
        Participant

        hi Aumi,

        I agree with your statement about having a clear idea of what your goals are because without having goals of what you want to do, you wouldn’t be able to focus on your strategies and plan for your business.

      • #15641

        Regina Mezit
        Participant

        Great job, I agree with you that in order to get more customers, you need to do some research and understand which group of people to target, having a target audience, because if in the area where the store is located, for example, there are a small number of family residents and the number of single people is higher, then in this case the demand for ice cream will be much less, unlike families that come with children.

        • This reply was modified 22 hours, 38 minutes ago by Regina Mezit.
        • This reply was modified 22 hours, 37 minutes ago by Regina Mezit.
    • #15628

      yangi
      Participant

      What would you like to do?

      I would conduct some research on segmentation and targeting because I want to understand the store and the customer better. By doing these I can focus on plans and goals I want to achieve in my store.

      How do you want to segment the market?

      I chose demographic to target customers as it helps my business to understand a group of the people who buy the product, I can see what kind of customers are attracted based on age, location, gender, and other variables in my store. I did some research and learned that people who come into my shop as a family buys more ice cream than either those with or by themselves.

      What do you want to do?

      I want to target families because families might have a whole sum group of people and can spend more on ice cream. When families do have a day for themselves, they will likely visit an ice cream store for their kids. As a result, you get a boost in family traffic. Your average monthly sales go from $17,459 to $21,076, a boost of 20.72% percent.
      (You have unlocked the bonus section.)

      Why do you think your method was effective or not?

      My method was effective because families are active consumers. They tend to spend more on ice cream because they are usually buying for 3 or more people at a time. When you see a group of families with kids, they usually buy for kids and tend to buy for themselves as well.

    • #15632

      Ivan Ramos
      Participant

      Segmenting the Ice Cream Market
      Let’s say you own an ice cream shop where you make your own delicious flavors. You’ve got a pretty good base of regular, local customers. But you want to bring more people into the store.
      Over the last year – with no formal marketing – your ice cream shop made an average of $17,459 in revenue a month, which pays you, the owner, $4015 .Your goal is to get more people into your ice cream shop.

      For my research I began with finding out what my goal was and getting more insight on who my target market is. This helped me break down how I will construct a game plan for Segmenting.
      RESULT: “Your goal is to get more people into your ice cream shop. See if you can increase your average monthly revenues by more than 20%. If you do, you will unlock the bonus level.”

      What would you like to do?

      I decided to conduct some research around segmentation and targeting in order to define my market so I can then have a better sense of who’s out there, which includes geography, because I want to know who the locals will be and identify if families live in the immediate area. Also, It’s important to attract a sustainable amount of foot traffic and whether my area is a possible tourist attraction.
      How do you want to segment the market?

      I decided to segment the market by geography because those who live and work in the area will be my primary target. It will help me establish a strong marketing message to the locals. It’s likely that the people who live and work close to my shop are the ones who will visit the shop on a regular basis. It’s important for the marketing campaign to let them know that they are welcomed and this business was made with them in mind.

      Given that, what do you want to do?

      Because I chose to focus on geography, I will then spend my investment on programs that would better target people who are within a short walking distance of the store. The aesthetics will focus on what my customers love most about ice cream, including choice of ice cream flavors, decor, discounts for those who work in the area, special events and more.

      RESULT: You spend $750 a month on some signs to better let foot traffic from some busier thoroughfares know where you are. This has a significant effect, improving your traffic by 17.36%, well worth the effort.

      I then decided to spend $500 per month to hire a sign spinner to point more foot traffic to my store and see what happens. Your sign spinner program reaches 12.76% of your target audience – the foot traffic.This program increases your shop’s income by 8.65%, the result of some new people coming in and more frequent visits by current customers. The program seems to work well with families, which was a big part of my goal. Families drive up sales and it serves as a great way to put the word out there.

      Now that that shop has resonated with families, I then decided to do demographic research and learn that people who come into your shop as a family buy more ice cream than either those with friends or by themselves. Also, the people with more money spend more.
      Given that, what do you want to do? Answer: Look for behavior regarding customer loyalty. With that, I identified segment based of customer behavior: • Die-hard fans (several visits per week); • Weekenders (come in regularly on weekends); • Pre-customers (not a customer now but they might be soon).

      What do you want to do now? Answer: I chose to focus training employees to greet return shoppers by name, know their common orders, and offer surprise add-ones. This program delights regular customers and has a strong impact. Revenues increased an amazing 34.72% to $23,520 per average month.

      As a result of the great success my business was experiencing, a competitor opened an ice cream store in another part of town and markets to “food lovers” with the quality of their ice cream.This impacts you significantly, reducing your average monthly revenue by more than 17.7%. Based on your experience, which segment do you want to focus on to combat this?
      I then decided to segment the marketing to focus back on targeting and focus on families. Now my revenues are up 6.58% instead of down 17.7%.

      Now what do you want to do? I doubled down on focusing on families and my monthly revenue increased by 36.15%. My competitor goes out of business.

      • #15639

        Regina Mezit
        Participant

        An excellent choice of signs to attract attention. I especially think it works well if the signs have content that will grab the attention of the kids, like cartoon characters and kids favorite characters.

      • #15646

        Germain Soriano
        Participant

        Greetings Ivan,

        I like your unique approach. You used every resource at your disposal to increase sales, and successfully drove the competitor out of business. I was hesitant on spending money on signs because I was doubtful it would be an effective marketing tool. From personal real-life experience, I avoid businesses that use this tool because they tend to seem shady. However, I’ll be more open minded in the future.

    • #15636

      Regina Mezit
      Participant

      I own an ice cream shop that makes $17,495 a month.

      Having an ice cream shop is worth evaluating people living in the area where the store is located, namely asking questions:
      What percentage of my customers visit my shop as a family, with parents and children?
      About 30% of the people in my area are family shopping. Children are good, because children love ice cream, regardless of the season, moreover, adults also like to eat ice cream, we can conclude that the more people in the family, the more they will buy. In addition, in areas where family people live, there are many playgrounds, various entertainment complexes, schools, and so on, this is beneficial for me because there are a lot of children in these places, and as we remember, children love ice cream.
      How many are summer people?
      About 35% of people in my area are summer people, which means they spend a lot of time outside. In the summer season, families spend a lot of time with children and other family members to have fun, talk and, of course, eat ice cream.

      My goal is to get more people into my ice cream shop, I have to increase sales by 20% per month.
      I decided to do some segmentation and targeting research, the goal is to define the market so I have a better idea of ​​who will be buying ice cream and who has the funds to buy it. I decided to segment the market by demographic because it would allow me to estimate people’s age, family status, and income.
      After doing research, I understand that people who come to me with the whole family buy more ice cream than those who come with friends or on their own, and also that people with more money buy more.

      I decide it’s best to sell ice cream to family people. To that end, I sponsor several local high school teams and the off-season, distribute ice cream for several high school parties, and sponsor summer tennis matches and several sailing teams.
      As a result, I get an increase in family traffic, the average monthly sales increased from $17,459 to $21,076, which is a 20.72% increase.

      A competitor opens an ice cream shop in another part of town and sells the quality of his ice cream to “food lovers”. This could impact my store and reduce my revenue by 17.7%.
      I decide to continue selling ice cream while still targeting families. Now my income is up 6.58% instead of down 17.7%.
      I double my focus on families and end up increasing my average monthly income by 36.15% and my competitor leaves the business.

      The path I have chosen is successful because I evaluated my product and realized that a product like ice cream is more suitable for a family that has a larger number of family members and especially children. After evaluating the area in which the store is located, I realized that in this area there are a large number of families with children, as well as various schools, playgrounds, and so on. My method proved to be effective because I stayed true to the choice I made, namely the choice in favor of families, which allowed me to increase sales by attracting more families.

      • #15651

        katellyn ahuatl
        Participant

        Hi Regina,

         

        We have similar plans when it comes to running an ice cream shop. I see that you also focused on families specifically children. I see how you did more information on who’s around the neighborhood which is key to navigating your business. Your focus was spot on ! It was interesting to see how you choose to surround your business around schools which we both know that’s where families are ! We both had a focus on keeping families content and you did deliver your own personal method well!

    • #15645

      Cramsahai
      Participant

      Chelisa Ramsahai

      Week E

      As an entrepreneur working to build my house-made ice cream business in the 21<sup>st</sup> century, I would first start looking into ways to make my product different from other local businesses. I would make my packaging unique and attractive to my demographic. I would also make unique flavors and do some online marketing or ask my customers to put online reviews on their experience of having my ice cream.

      How will I do it?

      I’ll make my packaging unique and attractive by using bright colors and using cartoon characters to get the attention of kids. I would make my ice cream healthier so that parents would prefer to give It to their kids rather than store-bought ice cream. I’ll use candy flavors to make my ice cream like nerds, Butterfinger, and sour patch kids to name a few instead of basic strawberry and vanilla.

      Outcome

      With my online marketing and reviews from previous customers, it will attract attention and customers. I can also have promotions online where if people share my online post, they will earn themselves a free cone, which will help in growing my network. It might take a few months for my business to get to its peak moment but doing the above will increase my daily sales.

    • #15648

      katellyn ahuatl
      Participant

      Segmenting the Ice Cream Market

      Scenario: Let’s say I own an ice cream shop where I make my own delicious flavors. I have a good amount of regular local customers. As I was looking back at my business on how it was doing on its sales I noticed that over the last year with no formal marketing my ice cream shop made an average of $17,459 in revenue a month, which pays me the owner $4015.

      My goal: To bring more people into the store along with trying to increase sales. What steps should I take to achieve this? Let’s take a closer look at the possibilities we have and what we could work on as the owner to keep my business running efficiently. As a business owner I know how important customers are since they are the number one thing that keeps a business working at the end of the day.

      First Step: I want to dig deeper so I will start by conducting research around segmentation and targeting. This would allow me to be aware of who’s coming into my shop, who wants to buy my product along with who’s my target audience.

      How do you want to segment the market?
      I will start segmenting the market demographically which involves finding out my audience age, family status and income. The reason why I chose this first is because knowing this information would allow me to navigate the type of advertising I would do to attract the people of that age. This would also allow me to set a proper price since I would be aware of their income which is important since I don’t want to overcharge or charge too little.
      Ice cream sells well to families since they have kids and we all know kids go crazy for ice cream so what better way to have your business located at.
      Result: As a result, I get a boost in family traffic. My average monthly sales go from $17,459 to $21,076, a boost of 20.72% percent.

      Knowing this I’m aware I won’t be the only ice cream shop around which brings me into competition.
      How would I target this ?
      I would make sure that my shop serves the best quality and customer service which would lure the families to choose my shop over the other ones. This resulted in my revenues being up 6.58% instead of down 17.7%. I found out that my main goal is to keep families coming so I would put them as my number one and make sure they are well welcomed and served. Families are important because they can have other families come in and keep the cycle going.

      End Result: I double your laser-like focus on families, and I end up increasing my average monthly revenues by 36.15% which results in my competitor going out of business. My method was successful knowing who your customers will make you as the owner what to work better on when it comes to advertising , location , and ages. I knew that focusing on families les would bring my ice shop the most traffic and sales

Viewing 19 reply threads

You must be logged in to reply to this topic.