3.2 Segment Analyses

The Market Segment Analyses, pages 5 - 9 of the Courier (Figure 3.2), review each market segment in detail.

Figure 3.2 Traditional Market Segment Analysis: Segment Statistics and Buying Criteria display in the upper-left corner of each segment analysis.

The Statistics table in the upper-left corner reports Total Industry Unit Demand, Actual Industry Unit Sales, Segment % of Total Industry and the segment's Growth Rate. The Customer Buying Criteria table ranks the customer criteria within each segment (these are the criteria listed in 2.2.3 Criteria By Segment):

• Ideal Position: The preferred product location as of December 31 of the previous year (The preferred location is also called the ideal spot– ideal spots drift with the segments, moving a little each month.);
• Price: Every year on January 1, price ranges drop by $0.50;
• Age: Age preferences stay the same year after year;
• Reliability: MTBF requirements stay the same year after year.

Are your products meeting your buyers expectations?

The perceptual map shows the position of each product in the segment as of December 31 of the previous year.

3.2.1 Accessibility and Market Share Charts  

The Accessibility Chart (Figure 3.3) rates each company's level of accessibility. Accessibility is determined by the Marketing Department's sales budget– the higher the budget, the higher the accessibility. Accessibility is measured by percentage. 100% means every customer could locate your product.

Figure 3.3 Segment Analysis Accessibility and Market Share Actual vs. Potential Charts

The Market Share Actual vs. Potential Chart (Figure 3.3) displays two bars per company. The actual bar reports the market percentage each company attained in the segment. The potential bar indicates what the company deserved to sell in the segment. If the potential bar is higher than the actual, the company under produced and missed sales opportunities. If the potential is lower than the actual, the company picked up sales because other companies under produced and stocked out.

Top Products in Segment lists the products selling in the segment and reports:

• Market Share
• Units Sold to Segment
• Revision Date
• Stock Out (Whether the product ran out of inventory.)
• Performance and Size coordinates
• Price
• MTBF
• The product's Age on Dec. 31
• Promotion and Sales Budgets
• Awareness and Customer Survey (See below.)

3.2.2 Awareness And Customer Survey

Customer Awareness (Figure 3.4) is determined by the Marketing Department's promotion budget– the higher the budget, the higher the awareness. Awareness is measured by percentage. 100% means every customer knew about your product.

Figure 3.4 Customer Awareness reports the percentage of customers who knew about your product. The December Customer Survey reports what customers thought about your product; the higher the score, the better they liked it.

The December Customer Survey (Figure 3.4) indicates how customers perceived the products in the segment. The survey evaluates the product against the buying criteria. Zero indicates the product met none of the criteria. A perfect score of 100 would result when the product:

• Was priced at the bottom of the expected range;
• Was perfectly positioned (because the segment moves each month, this can occur only once each year);
• Had an MTBF specification at the top of the expected range;
• Had the ideal age for that segment (because the product ages each month, it can only have the ideal age once each year);
• Had 100% Awareness;
• Had 100% Accessibility.

Ages and distances from the ideal spots change throughout the year, therefore scores change month to month. If a repositioning project concludes late in the year, the survey score for December could be significantly higher than the scores for the previous months.

Perfect scores are almost impossible. Scores of 50 or above are considered good.

Accounts Receivable policy and, if the module is enabled, TQM/Sustainability initiatives also affect the survey score.

Tip: Use the Customer Survey as a quick comparison tool when conducting a competitive analysis.