MKT6250 Week 3 Discussion - Why bother segmenting
Week 3 Discussion Forum (MKT6250 Healthcare Marketing)
1. Why bother segmenting the market? What advantages accrue to this effort?
2. What are ways one could segment consumer markets?
3. What are ways one could segment business markets?
4. Why is there a difference?
Week 3 Discussion Forum
Bellsouth Mobility (BM) ran a pricing trial in order to estimate the elasticity of demand for its services. The manager selected 4 states that were representative of its entire service area and increased prices by 5% to subscribers in those areas. One month later, the number of its customers enrolled in BM's plans declined 4% in those states, while enrollments in states where prices were not increased remained flat. Based on this information, the manager estimated the own price elasticity of demand and based on her findings immediately increased prices in all markets by 5% in an attempt to boost the company's revenues. One year later, the manager was confused because BM's revenues were down 10%. Apparently, the price increase led to a reduction in the company's revenues.
Did the manager make a mistake? Explain.