Market segmentation as a strategy of corporate performance

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University of Dar es Salaam
The marketing concept is a philosophy which is founded on the belief that profitable sales and satisfactory returns on investment can only be achieved by identifying, anticipating, and satisfying customer needs and desires. It is an attitude of mind which places the customer at the centre of business activity and automatically orients a company towards its markets rather than towards its production. In line with the marketing concepts we have a new notion of market segmentation which is a relatively recent and revolutionary concept in business circles. Market segmentation has become a widely discussed concept among practitioners and academicians. Conceptually, a strategy of market segmentation involves the development and implementation of different products and/or marketing programmes for different components of the overall market. In other words it is based on the fact that markets and customers who comprise them are heterogeneous. However, the recognition for heterogeneity of markets, followed by development and implementation of different marketing programs for different market segments seems to be more pronounced in the more developed countries like the U.S.A. and Britain. A perusal over the available material on business operations in the less developed countries, Tanzania in particular, seem to reveal that very little effort, if any, has been devoted on this issue. This might be one of the major reasons for overstocking of some products (Mainly slow-moving goods) and shortages of fast-moving goods. Understandably, overstocking and shortages could be caused by numerous factors; for example:(1) Limited foreign exchange required for the needed imports.(2) Limited local production (Limited supply) for products which are solely manufactured locally.3) Poor distribution system by some of the NTCs and RTCs(4) Lack of research by the NTCs to identify the exact types and sizes (quality and quantity)needed by the different groups of customers for every product. Of the above mentioned factors, the fourth one seems to be more central to the problems facing the NTCs. This study, therefore, surveys the selected NTCs in Tanzania to find out if they use market segmentation and what segmentation variables they use to group their customers. The underlying point of this study is that the inherent market problems (Including shortages and overstocking of some products) are mainly due to lack of scientific market analysis (market research}. However, a point can be noted here that this study was limited only to the NTCs which are primarily concerned with the distribution function. Due to several problems like limited time and financial resources, the study could not address itself to the other aspects the producers' side and consumer preferences, which might have shed more light on these points.This paper starts by giving a summary of the historical background of the Distribution sector in Tanzania, followed by an introductory chapter in which the development of the marketing concept is traced and related to the concept of market segmentation. Also in this chapter the research objectives are discussed together with the research hypotheses and the methodology. The third chapter dwells on the various, findings in the area of market segmentation. The fourth is devoted to data presentation while the fifth chapter discusses the results. And the final section contains the conclusion and recommendations.
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Marketing, Corporations, Tanzania
Mpaka, P. M (1987) Market segmentation as a strategy of corporate performance, Masters dissertation, University of Dar es Salaam. Available at (