International Business – Singapore
Write about the Segmentation theory
Introduction
Segmentation theory refers to the classification of the market for a specific service or product. It
involves classification into various segments or groups. It allows the market to achieve the most
in all the segments and improves the response of the service or product being offered in the
market which results into higher earnings.
2.2 Benefits of segmentation
The importance of market segmentation is that it increases the efficiency in marketing operations
by narrowing the market specifically toward a designated and defined segment in a way that is
consistent with the characteristics of the segment. Market segmentation leads to product
differentiation from each segment while tangibly or intangibly differentiating it from the rival
products from the competitors. Johnson and Johnson improve its operations, expand its business
and also increase its earnings in the market by segmenting the market and satisfying the needs of
each segment independently. To achieve these, it can create a mutual way of communicating
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between its customers and its sales and marketing teams to ensure the right product is available
to the customer.
3.0. Target Market Identification
3.1. Geographic Segmentation
Singapore is located in the South Eastern Asia and is officially known as the Republic of
Singapore. Its current population is estimated to be 4.8 million together with the emigrant
population. It covers an area of 647.5 Kilo meters square. The total residences in Singapore
amount to 3642.7 which is about 50% of its total area i.e. the urban areas. Parkland, military
areas and others make up the remaining 50%. The main city of Singapore is built around the
river banks of Singapore River. Its former colonial district lies on the northern side while little
India and the main Central Business District follows the Singapore rive to the south. Jurong city
stretches to the west of Singapore while on the eastern shores of the city lies the international
airport and where also most of up-market residences are located. Its geographical location and its
fresh sea breeze present an ideal climatic condition that ranges between 23 to 31 degrees Celsius
with a high humidity and enough rainfall. The eastern side is drier and a bit hotter than the
western side. Singapore is home to 63 islands which provide a strategic front for tourism and
trade. Most of its residents are from China, Srilanka, Indonesia and India. Popularly known as
the Green city, John and Johnson will organize its distribution networks where there is high
population density i.e. along the Singapore River which houses most its residents and also where
the CBD is located. (Central Business District)
3.2. Demographic Segmentation
Singapore is one of the most densely populated nations on earth. Chinese residents who have
acquired citizenship in Singapore lead the population in terms of numbers of inhabitants while its
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religious policy is open i.e. there are all kinds of denominations i.e. Hinduism, Christianity,
Islam, Buddhism, Taoism among others. Singapore has a very low birth rate which increases the
standard of living i.e. the levels of literacy and living standards are high. The low rate of birth
has led to the aging problem where a higher percentage of the population is aging at are rate that
is not being equally compensated by the birth rate i.e. older people are increasing faster than they
are being replaced by the younger population. The 0-14 year’s bracket is dominated by males.
Females dominate both the 15-64 years and also the over 65 year’s age bracket. The well
developed infrastructure i.e. local and international transportation networks and communication
systems make Singapore an ideal business location. John and John will most likely target the 15-
64 female dominated market and also the upcoming younger generation. An average
Singaporean nationality is mostly made up of a working house wife with a single child with an
average university degree qualification and an income level of between 500 to 1000 Singapore
dollars. The multicultural Singaporean citizens could affect the Johnsons and Johnson’s product
market as multicultural citizenry comes with diverse tastes that are a bit difficult to individually
segment. The low birth rate may also present a challenge for Johnson and Johnson products as its
products cover the full range of products needed from toddlers to adults. Johnson and Johnson
should also position their products. Positioning involves the development of brands as the images
of the company’s products. The combination of all the required elements of marketing mix is
needed to achieve the required strategy that will target toddlers and also grownups. Positioning
explains the uniqueness of the company products in the market place and also its advantages
against the products on the shelves. Branding is a tool that is often utilized to position the
product by designing its packaging and the writing styles used on the posters. Johnson and
Johnson also intend to recycle some packaging materials to cut down production costs and also
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to reduce its energy costs that will eventually lead to high profits. (Kotler, Keller, Brady,
Goodman, & Hansen, 2012)
3.3. Psychographic Segmentation
The impact of the lifestyle to the products of Johnson and Johnson cannot be ignored. A family
of young children with young parents has different needs from the family of older couples who
have left their children in the house. The consumption patterns are quite different. Children will
influence their parents buying patterns because of unique packaging while older parents are
generally conservative. (Kotler & Armstrong, 2010)
The target market for Johnson and Johnson is for families with at least a single child. Different
opinions and tastes exist due to diverse culture, hobbies, environmental views and general
family interests and also political opinions. These views and opinions will certainly affect the
consumer buying patterns on Johnson and Johnson products hence there is a critical need for
the management of Johnson and Johnson to be aware of any changes in patterns of views and
opinions that may affect its products or its general operations. Environment friendly products like
Johnsons and Johnson’s products can ultimately lead to a higher demand and growth of organic
products as more people are becoming conscious of their health standards and the need to
conserve the environment. By utilizing segmentation strategies, John and Johnson may
eventually adopt marketing mix that retains their loyal customers than always advertising for
new customers. They may prefer strategies that consolidate their efforts in promoting product
loyalty. (Smith & Taylor, 2004). Depending on the needs of the customers, Johnson and
Johnson may research and identify the various needs of its products per family. The
development of product advertising message takes place after the product has being successfully
position and the potential customers and their needs have been identified i.e. the requirements of
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the target group. A distinctive, creative and well branded advertising generates impressive results
that ensure successfully marketing and promotional strategy. To make the product more
appealing to the customers or the target group then the adverts designers should be constantly
referring to the customers to tailor according to their needs and tastes. For instance, to market a
product like shampoo for a new born, it would be more attractive to advertise the silent features
of the shampoo like its soothing effects on the baby’s eyes besides its natural hair treatments for
the baby’s hair. These will eventually lead to product loyalty and the brand will remain
imbedded on the customers mind for future references and even to her friends.
3.4. Behavioral Segmentation
Johnson and Johnson brand of products has a strong presence in many countries worldwide. It
has a very rich history that dates back many years. Johnson and Johnson brand is mostly
associated with young mothers who literally want to provide the best for their children. This is a
perception that is dominated by adherence to loyalty brands that are associated with high quality
products. (Wood, 2003)
Finally to conclude, for a product to be successful in the market then the consumer behavior has
to be analyzed not just the five senses that are attributed to smell, touch and taste should be
considered. A strategic marketer believes that the strong demand created will pull item, product
or service by compelling the marketing intermediaries to accommodate it through the marketing
channels. The ultimate aim of the marketer is to create a demand for the product among the
potential consumers who will eventually be attracted by the product or service and request for it
from the supplier.
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Reference
Kotler, P. & Armstrong, G. 2010. Principles of Marketing. 13th edition. London: Pearson
Education Ltd.
Kotler, P. & Keller, K. L. & Brady, M. & Goodman, M. & Hansen, T. 2012. Marketing
Management. 2nd edition. Essex: Pearson Education Limited.
Smith, P.R. & Taylor, J.2004. Marketing communications. An integrated approach. 4th edition.
London: Kogan Page Limited.
Wood, M. 2003. The Marketing Plan: A Handbook. New Jersey: Pearson Education Inc.
