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  • Subject area(s): Marketing
  • Price: Free download
  • Published on: 14th September 2019
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  • Number of pages: 2

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Market Segmentation

In this day and age, many different factors including advancement of information technologies and customer needs and wants determine the changes in the internal and external environments of an organisation. It is important for the company to be aware of the changes taking place in its surroundings in order to be a part of the increasingly competitive markets (Yi, 2018). Market segmentation allows companies to divide massive, diverse markets into smaller divisions for efficient management and more thorough systems to be able to satisfy customer wants and needs (Kotler et al., 2017). How to segment markets and how many to use is solely the decision of the company based on their own activities. There is no one way to segment markets. Specific to Emirates airlines, because of it being a part of such a highly competitive market with increasing competitors, it requires improved strategies that will allow it to lead the competitive market (The WritePass Journal, 2012). For this reason, Emirates relies mainly on geographic and demographic segmentation (in terms of income).

Geographic Segmentation

Geographic segmentation simply refers to segmenting the company markets into various geographical units such as regions, cities, counties and so on. The company itself may take the decision to operate within a certain number of geographical units keeping in mind that the ultimate goal is to achieve customer satisfaction. For example, many organisations localise certain products or services as per the demand of the population based on region and area (Kotler and Armstrong, 2018). Emirates estimates Dubai to be the most popular travel destination of its customers from other parts of the Middle East, Western countries and Asia pacific. The airline also concludes that most of these customers are usually business men who travel to Dubai on some important business work, whom they cater to and ensure their trip to be as comfortable as possible (Ukessays.com, 2016).

Demographic Segmentation

A customer's wants and needs are closely associated to numerous demographic variables such as age, gender, income and occupation, to name a few. Demographic segmentation means to be able to segment the target market based on these, and other similar variables. Apart from it being associated to customer wants, these variables are also easier to measure in graphs and numbers (Badar and Rizvi, 2008). As a part of the airline industry, Emirates often divides its customers based on demographic variables like income and occupation. The airline caters to different social classes by dividing the luxury options in terms of price affordability. Giving the opportunity to the customers to make a decision between their economy, business and first class services, giving the customer the feeling of control and authority. These services, however, do not only benefit the customer, but also allows the company to segment their target market based on the actual income the customers and how much they are willing to spend on luxury and comforts. However, does income always determine the best customers for a given product? A customer may be a part of the middle class sector but still be willing to spend more on travel rather than on expensive clothes and cosmetics. In terms of occupation, Emirates also caters to a large number of entrepreneurs allowing them to expand their service options for these passengers.

Target market and Positioning

Segmenting a market provides the company with the basis for selecting a particular target market to serve. The target customers are grouped based on certain similar characteristics giving the company the chance to develop a single marketing mix strategy to cater to their entire customer market (Jobber and Ellis-Chadwick, 2016). Emirates targets the luxury flyers as opposed to some of the other local airlines in the United Arab Emirates such as Air Arabia, that is considered to be one of the budgeted airlines in the Middle East. All those customers who choose a comfortable and luxurious travel journey over the idea of simply traveling to destinations, rely on an airline like Emirates. However, segmenting the market towards the focus of a particular target group may also be the downfall for a company. If at all the preferences of the target market changes, or collapses in anyway, this may adversely affect the business. Similarly, narrowing the target market results in loss of business opportunities by dismissing all those customers who lie outside this market (Ali, 2014).

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