Once the segments are
crafted, companies need to identify which ones to target. Their choice depends
on a number of factors.
Firstly, it is important that the company has
competencies and strengths that are required to compete in the segment. It is
easier for a company to succeed in segments, where it possesses competitive
advantage.
The size and growth rate of a segment adds to its
appeal. The drawback, however, of an attractive segment is that it tends to
attract competitors.
The level of competition is an important
consideration. It is more difficult to enter a crowded segment than one where
customers’ needs are not well served.
