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Give the disadvantages of Market Segmentation.

      

Give the disadvantages of Market Segmentation.

  

Answers


Lellah
a. Segmentation increases costs/ Costing is not taken into consideration . When a firm attempts to serve several market segments, there is a proliferation of products. Cost of production rises due to shorter production runs and product variations. Targeting a segment is ok but you also need to know how much you will have to spend to target a particular segment.
b. Larger inventory has to be maintained by both the manufacturer and the distributors.
c. Promotion and distribution expenditures increase when separate programme are used for different market segments.
d. When characteristics of a market segment change, investment made already might become useless.
e. Segments are too small – If the chosen segment is too small then you will not have the proper turnover which in turn will affect the total margins and the viability of the business.

Lellah answered the question on November 5, 2021 at 06:48


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