Identifying+E-Business+Customers

===Consumer surveys are an important part of marketing research. Companies use the gathered information to develop and improve products. Surveys are expensive and time consuming. Most companies send surveys to consumers by mail. They often provide a small cash incentive or gift to encourage responses. Even so, because surveys require time and effort to complete and return, the response rate is often quite low. Sometimes only five to ten percent of the mailed surveys are returned. ===

**THE IMPORTANCE OF CUSTOMERS **
===Customers are the lifeblood of a business. They decide whether to purchase a company’s products or the products of a competitor. They may be persuaded to try a product once. If satisfied, they are more likely to purchase from the company again. They may encourage friends and family to buy as well. Companies with satisfied customers are likely to be successful. Those that are unable to satisfy customers will soon fail. ===

===One of the most important tasks of marketing is to identify prospective customers for a company. The activities needed to attract customers include marketing research and promotion that gets the attention and interest of new prospects. Also important are some types of incentives to encourage customers to make their first purchase and follow-up activities that ensure customer satisfaction. Any concerns the customer has about the product must be identified and resolved. Companies that have clearly identified their potential customers can concentrate their marketing resources on those prospects. ===

===Many Internet-based businesses believe that obtaining customers will be easier online than through traditional routes. However, the Internet presents several challenges. First, a large percentage of prospective customers do not have reliable Internet access or are not comfortable shopping online. Second, when a business goes online, it becomes one of thousands with a web site. It is not likely that a prospective customer who is unaware of a business will locate its web site and choose it as a purchasing source. If the prospective customer does locate a business’s website, a successful sale requires that the site be well designed and easy to use. It must offer the best product choices from among all of those available online as well as through traditional channels. ===

**Customer Characteristics ** ===When consumers want to make a purchase, they usually have thousands of products and services from which to choose. Some consumers will find that the products of a specific business meet their needs. They will return to that same business to purchase those products again and again. Other consumers will not be interested in that company’s products. Trying to turn a consumer who is not interested in a company or its products into a regular, satisfied customer is both difficult and expensive. If a company is able to identify the people who are satisfied with its products and services, it will be much easier and less expensive to retain them as customers. ===

===Every business has access to thousands and sometimes hundreds of thousands of consumers. The Internet provides an even greater number of prospective customers. While many potential customers do not have Internet access, most of those who do are using that connection to gather product information and to search for businesses that offer products. However, only a small percentage of the people who use the Internet to gather information actually make their purchases online. A business needs to develop an effective method of identifying those consumers who are most likely to purchase. It should concentrate its marketing efforts on attracting and satisfying those customers. ===

===The process of identifying high-potential customers is known as **market segmentation**. A market segment is a group of individuals within a larger market who share one or more important characteristics resulting in similar purchasing needs and behaviors. ===

===Markets are segmented by a number of characteristics that can be used to identify prospective customers. Factors often used to segment markets are demographics, psychographics, product usage, and specific needs and benefits. ===

===Demographics are the descriptive characteristics of consumer. Common demographics characteristics are age, income, education level, gender, race, ethnicity, marital status, family size, geographic location, and occupation. ===

===Psychographics refer to people’s interests, activities, lifestyles, and values. People make choices based on their interests. Someone who is interested in health and nutrition may be attracted to certain types of products and choices. Another person who is involved in investing and financial planning will have other products and service interests. ===

===Product usage identifies the frequency and quantity of use of a category of products. Segmenting a market of people who rent movies might identify those who rent more than twice a week, those who rent one to two times a month, and those who rent less than five times a year. Segmenting may also identify those who typically rent more than three movies at the same time and those who rent only one at a time. ===

===Needs and benefits segmentation divides a market based on the primary reasons that customers make a purchase of the value they receive from the use of the product. People need to rent automobiles for business travel, family vacations, or emergencies when their own cars have been damaged or are being serviced. Benefits derived from selecting a particular bank may be convenience, personal attention, a high level of service, or financial gain. ===

**Identifying Market Segments **
===Companies gather and analyze consumer data in order to segment a market. When a business has identified all of the segments that exist in a market, it can make decisions about which segments to serve. It can also decide the marketing mixes that will be needed to satisfy those segments. The segments of a business’s market selected for attention are its target market. To be effective as a target market, the segments must meet four criteria. ===

===<span style="font-family: 'Calibri','sans-serif';">Each of us belongs to several market segments based upon our personal characteristics and needs. You are an important member of a market segment for some businesses. Other businesses are not interested in your at all. For some businesses, demographics are the most important factor in segmenting a market. For others, it might be needs, pervious purchase experiences, or interests. Consider a company that produces and sells uniforms. If the company manufactures school uniforms, an important market segment would be school-age children and their parents. If the company manufactures military uniforms, then government agencies would e an important segment. If the company sells work uniforms, the market might be segments by occupation or industry. ===

===<span style="font-family: 'Calibri','sans-serif';">Need segmentation is an important way to study a market. For example, people who have a need for entertainment and socialization have a variety of demographic characteristics. There may be a wide range in age, income, and education levels. Yet, people who are in your age group are likely to have different entertainment and socialization needs than their parents, grandparents, or younger siblings. People in high-income brackets may make different entertainment choices than those with limited resources. ===