Marketing segmentation strategy of foreign trade

Craftsman manufacturer of bronze statuettes, Mr NANA owner of DESIGN NANA, would like to launch out, in the manufacture of high range furniture covered with loincloths bogolan and bazin, with incrustation of decorative element in copper and bronze.

In front of the market evolution of the craft industry, and especially with the success had during showrooms and fairs in the visited countries, in Africa and in the whole world, he decides to go to the external market of his country.

To carry out his dream, NANA a childhood friend, came to see me in order to know « how to do ? »

I testify that his question initially disorientated me because it encompasses many other fundamental questions in the international business: where to export, what to export, when to export, how to export, for whom to export, and so forth…

Thus when I let him know about my embarrassment, and after having remained me that I was the expert, he gave me more accurate information that allowed me to recognize my role of expert. Actually, orders coming from abroad, particularly from certain countries ( for strategic reasons we cannot publish the list ) exceeded more than 70% the local consumption of furniture. In fact NANA DESIGN is a firm orientated towards the international market and its survival necessarily depends on it.

The true concern for my friend was: how to export in a sustainable and profitable way on the selected markets.

How to export in a sustainable and profitable way on the selected markets?

Already, the ideal to export Coca Cola, et Peugeot would be to offer as many different products as there are individually customers taken. It means offering to each customer a product " personalized ". Thus each one will have its Coke beverage according to his expectations, convictions, and even his whims : green (from dark to yellowing) for the ecologists, to honey or vanilla to bring us closer to the countryside, to the jinjinbre to wake up the feelings, or panacea to the whiskey to make short.


But as these large firms have not yet been able to make it possible, the marketing analysts develop methods to try as well as possible to offer personalized products to various groups of consumers presenting common characteristics: habits, behaviors, motivations, expectations, lifestyle… This is known as segmentation: a technique of splitting the market consisting in isolating from the groups of consumers in a homogeneous way according to specific criteria (demographic, economic, behavioral, psychographic, practices of purchase characteristics …). This action is called consumers segmentation opposition to the product segmentation which, segments the sale of a generic product in sub-group for example: car can be subdivided in vehicles of tourism, commercial vehicles, cross-country vehicles (4X4), the trucks etc

“Of course, this is a consultant word! » NANA told me.

In other words to avoid the academism and to allow my friend to understand me: to segment is to split out a too heterogeneous market for NANA DESIGN’s capacities in order to gather the customers in homogeneous groups, allowing thus him to propose offers adapted to the needs for each group or to concentrate on a profitable group of way. The segmentation allows the adequacy between NANA DESIGN’s capacity and his customers expectations.

Generally, the export Firm adopts the segmentation when it wishes as well as possible to control its sales strategy on the target market. This option as well makes it possible to sell in an optimal way as to create and develop sales networks. The markets are functions to countries and/or offers. They are very diverse sizes of niche going from (galleries, museums, hotel groups, collectors of ethnic art…) to bigger market (households, art lovers, firms…).

The segmentation as a positioning tool

The firms’ environment, especially the SMC one and new born firms, are characterized by unquestionable uncertainties, a fierce competition and the volatility of the customers. One of the strategic options within the framework of an internationalization step is to tackle the various niches of market in which the firm can reach (technologically, financially, geographically and even legally), and to satisfy the niche’s needs. The strategy of niche, also called focusing strateg is an approach based on NANA DESIGN’s choice as to concentrate on a particular target of the potential customers targeted. Voluntarily, NANA DESIGN « will focus » on a segment of customers, which name will be « focusing strategy ».

The brand role

But it is essential to NANA DESIGN to build a strong brand. The trade mark hitherto considered as a means of differentiation, evolves according to the markets (consumers habits, niches, etc...

The brand is a dynamic concept and to perceive it in a static way exposes at the risks for the international business man. Besides, NANA DESIGN will have to take into account the fact that his market is global or local, i.e., a single or different brand according to the multiple segments, niches or geographical areas. As it had been mentioned in our ticket 06 janvier 2009 « The brand more than a sign » the global brand is from high technology and luxury products.

The exchanges between human beings got increased through trips, democratization of the TICs etc. Talking about TICs, Paul Virilio it was said « The means of telecommunication, not being happy to restrict the extent, also abolish any duration, any messages transmission deadline time, the images. ». The pockets of expenditure and consumption tend to being the same in several countries, thus on these homogeneous markets, it would be logical to think of homogeneous brand. The age bracket targeted by the brand also influences, just as the cultural stereotypes, the country image, the idiosyncrasy, etc

Positioning is a strategy that strongly lays on communication. To position a product, consists in making so that this product may profit from a privileged place in the consumers’ mind that belongs to a targeted market segment, or a given niche. A product positioning consists in defining the place which this product compared to the competing products will have to occupy.

To come back to my conversation with my friend NANA, I turned him back to the concept of mix marketing. Good positioning is got while exploiting the characteristics of mix marketing: on the product policy (esthetic, quality, robustness, simplicity, etc), the price policy (see the page on the price of acceptability), and the distribution and communication policy (luxury, top-of-the-range, ethnic product, ecological or humane concept, etc).

Yet, bad positioning of the products, can introduce in the consumer’s mind a product that is quite different from what NANA DESIGN originally initiated ( For example Lacoste who positions his products for middle-class customers, whereas it is more popular customers who “adapted” his products ). Missed positioning generates marketing and intercultural risk.

In conclusion, NANA summarizes in these terms: " To sell in an advantageous way to my customers and my firm, we must in the countries where we should export and where we hope to do it, initially identify our customers and to gather them according to their needs. We must attract new consumers and keep them while offering them pieces of furniture according to the needs identified as a preliminary thanks to a strong brand."