segmentation and target market paper essay

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Marketing and advertising

Walmart Corporation

Upon beginning a business, an organization must make a decision where to place the business and how to market the company. This is not always easy if a lot of businesses of the same industry are situated in the same neighborhood. Before the company can open, a fresh business must choose what market they wish to reach as well as the best way to succeed in them. The corporation must also decide the psychographic and behavioral characteristics of each and every market the company is trying to reach.

The following is information on how Walmart Organization chooses their geographic, demographic, psychographic, and behavioral portions when the business places a brand new store in a specific neighborhood.

Walmart History

The initially Walmart retail store was established in Rogers, Arkansas, in 62 by president Sam Walton (Walmart Company, 2014).

Walton shifted his family to the part of Bentonville, Arkansas to take advantage of tiny town living and exposed his Five and Dime store inside the town rectangular. With the success of that store he made a decision to open the first Walmart to offer lower prices and better services to his valued customers (Walmart Corporation, 2014). By 1970, the company choose to go public where Walton applied the profits to increase the business.

After some time the company grew enough that Walton chosen to venture in to uncharted place by starting Walmart Supercenters, Sam’s Golf club Warehouses plus the company’s initially international retailers in Mexico. The company now has “11, 1000 retail models under 71 banners in 27 countries and web commerce in 15 countries. We employ 2 . 2 , 000, 000 associates around the world ” 1 ) 3 million in the U. S. alone (Walmart Corporation, p. one particular, 2014). The company has been very successful however must keep in mind where a store is placed, what market to focus on, and how the corporation will promote the new shop.

Geographic Segmentation

Walmart is not defense from identifying where to place one of all their stores. The organization must consider where the shop and located and who also the target market will be. Relating to Kotler and Keller “geographicsegmentation divides the market in to geographical models such as international locations, states, locations, counties, metropolitan areas, or neighborhoods (2014, g. 214). Walmart strives to get as close to their customers as possible. Consequently , Walmart at present has 4 store formats that are used based on the geographical segmentation on where the firm wants to create a store. These kinds of stores will be Walmart Supercenters and Walmart Discount Stores where the business targets large and tiny neighborhoods, Walmart Neighborhood Stores that are put into neighborhoods where a pharmacy is required, and Walmart Express made for urban and rural locations where a larger retail store does not are present (Walmart Corporation, 2014).

Demographic Segmentation

Market segmentation is a process of separating a market into segments based upon “age, family size, relatives life routine, gender, salary, occupation, education, religion, race, generation, nationality, and cultural class (Kotler & Keller, p. 216, 2012). To get Walmart, what this means is targeting lower income and functioning class families to market all their company. In accordance to Brian, “Walmart is using its wealth of sales and inventory data to segment based on demographics, allowing it to market to certain age, ethnicity and cash flow brackets (2006. p. 1). What this means is that the corporation will industry more electronic devices in a mostly African American area, fresher develop for a Latino base, fine and organic foods intended for higher income individuals, plus more pet supplies to client 45 years and old. This gives the business the best opportunities to market for the demographic sectors while keeping all age groups in consideration achievable product lines.

Psychographic Segmentation

Psychographic segmentation is a process of positioning consumers in several categories based upon personality traits, life-style, or principles (Kotler & Keller, 2012). Walmart uses psychographic segmentation to market selected products for the company’s 3 core consumer groups. Walmart’s core consumer groups will be brand aspirationals, price-sensitive affluents, and value-price shoppers (Ryan, 2007). Underneath these groups, brand aspirationals are people with low income who like name brand products including KitchenAid or perhaps Black & Decker. Price-sensitive affluents happen to be individuals with bigger incomes who have love discounts and have a brand name intended for lower prices. Value-priced shoppers are those of lower income and do not possess extra funds to spend, therefore they are looking for the lowest value possible (Ryan, 2007).

Behavioral Segmentation

Behavioral segmentation is a process of positioning consumers in several categories based on knowledge of, attitude toward, utilization of, or response to a product (Kotler & Keller, 2012). To successfully market a specific merchandise Walmart may wish to keep in mind three core organizations that have been produced. According to Ryan, almost all product decisions the company makes will be based within the three main groups (2007). Feedback by these organizations will help the business determine what products that sell off best and others products the organization can remove because they cannot sell.

Placing Statement

The success of Walmart is paramount, but the company has not been without customer loyalty issues. According to Kotler and Keller, a brandname position is definitely the “act of designing a company’s providing and image to inhabit a distinctive put in place the minds of the concentrate on market (2012, p. 276). The company’s unique positioning affirmation for the longest the time has been the time hath been “Always Low Prices; Always (Walmart Corporation, 2014). However , in 2008 the company decided to transform their placing statement to aid kick-start new growth. The organization revitalized many of their retailers and altered their positioning statement to merely “Save Funds, Live Better (Lippincott, 2014).

This create a firestorm of growth because the company began targeting individual of all salary levels and raised their particular customer base by 7% for individuals with bigger income amounts (Lippincott, 2014). An alternative placement statement intended for the company could possibly be: “For individuals all ages and income amounts, Walmart provides name brand goods at affordable prices that will fulfill your needs, would like, and wants to help you save cash and live better lives.


In summary, market segmentation is important each time a company determines what industry to target. Geographic segmentation performs an important role as the corporation must make a decision where to put the business. Will the business be in a community closer to the prospective market or perhaps further aside. The part ofdemographic segmentation gives the firm an idea of the age groups, sexuality, income amounts, and cultural groups they wish to target. Psychographic segmentation helps the company identify lifestyles and behavioral segmentation help the business determine behaviour towards the company’s product. Walmart uses all of these options ahead of opening a shop in any area. This has offered the company the benefit of reaching the correct target marketplaces with wonderful success.


Brian (2006, Summer 14). Wal-Mart to Modify Stores through Demographics. Gathered on Sept. 2010 29, 2014 from Kotler, P., & Keller, K. L., (2012). Marketing Management (14th Ed). Pearson Education Incorporation.

Prentice Corridor, Upper Saddle River, New Jersey.

Lippincott (2014). Walmart, Save Money. Live Better. Gathered on September 28, 2014 from

Ryan, T., (2007, Mar 7). Wal-Mart Classifies Customers for Growth. Retrieved about September twenty eight, 2014 by Walmart Corporation (2014). Walmart Record, Our Account. Retrieved in September twenty-eight, 2014



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