Is more always better?
According to Kerin, market segmentation involves aggregating prospective buyers into groups, or segments, that have common needs and will respond similarly to a marketing action. He mentions that its main purpose is to lead to tangible marketing actions that can increase sales and profitability. A good segmentation strategy helps to limit business or product scope to the set of people you are most likely to be able to serve, bringing focus to the needs that should be targeted in your marketing communication. [1] In addition, market segmentation is a great way to create more choice.
Very often marketers assume that the more choices they provide to customers, the more likely they will be able to find just the right thing they are looking for. However, research and studies show that when there are too much many choices, consumers are less likely to buy anything at all, and if they do buy, they are less satisfied with their selection. Also, scientists have identified the brain region behind choice overload, which makes it difficult make a decision when faced with too many options.
In 2000, two psychologists published a remarkable and very interesting study. In the study a large display of gourmet jam at an upscale food market attracted more interest than a small one. But when the time came to purchase, people who saw the large display were one-tenth as likely to buy as people who saw the small display.
Both psychology and business have operated on the assumption that the relationship between choice and well-being is straightforward: The more choices people have, the better off they are. [2]
Certainly, having choices is good for us as individuals and we may think it can help our business to grow, but its relationship to satisfaction appears to be more complicated than we thought. I believe that it is imperative to do a deep research and know well your business (products, strategies, competitors) before making any decision that may put your investments and efforts at risk.
References:
https://www.decision-making-solutions.com/segmentation-strategy.html
