In this article a normative theory of market segmentation is developed that takes account of major implementation problems. The theory is presented as a multistage mathematical model of the full range of segmentation possibilities from the perfectly discriminating monopolist to the mass marketer. The theory's major implications for the philosophy and application of the market segmentation strategy are discussed in detail.
Get full access to this article
View all access options for this article.
References
1.
WilliamF. Duhammel, “The Use of Variable Markov Processes as a Partial Basis for the Determination and Analysis of Market Segments,” Unpublished doctoral dissertation, Graduate School of Business, Stanford University, March 1966.
2.
RonaldE. Frank, and MassyWilliam F., “Market Segmentation and the Effectiveness of a Brand's Price and Dealing Policies,”Journal of Business, 38 (April 1965), 186–200.
3.
“Estimating the Effects of Short-Term Promotional Strategy in Selecting Market Segments,” in RobinsonPatrick J., and HinkleCharles L., eds., Sales Promotion Analysis: Some Applications of Quantitative Techniques, Philadelphia: Marketing Science Institute (in press).
4.
HarperW. Boyd, “Correlates of Grocery Product Consumption Rates,”Journal of Marketing Research, 4 (May 1967), 184–90.
5.
GreenPaul, FrankRonald, and RobinsonPatrick, “Cluster Analysis in Test Market Selection,”Management Science, 13 (April 1967), B387–400.
6.
WilliamF. Massy, “The Cost of Uncertainty in Advertising Media Selection,”Graduate School of Industrial Administration, Carnegie Institute of Technology, Working Paper No. 2, December 1966.
7.
RobinsonJoan, The Economics of Imperfect Competition, London: Macmillan & Co., 1954, 179–88.
8.
RubinJerrold, “Optimal Classification into Groups: An Approach for Solving the Taxonomy Problem,”International Business Machines Corporation, New York Scientific Center, May 1965.
