Week 8
Running head: RESEARCH PROPOSAL 1
RESEARCH PROPOSAL 9
Hello, I appreciate the timely submission of the assignment. This is a difficult course and an on-time submission suggests you’re off to a good start! Just a couple comments about the introductory material. There is no need for a table of contents, and you want to simply use an APA formatted title page. I understand that you are likely following the format of the Prospectus Template. There seems to be some confusion with respect to what you are required to do in this assignment. You were to present the problem, purpose, and research questions for your intended research. There was no need for a review of the literature except as it applies to the development of your problem statement. There was also no need to discuss methodology which is premature given that this will be studied in the course. There was also no need for the statement of hypotheses. As noted in the assignment you are to: “Develop a problem statement, purpose statement, and research questions for your intended dissertation research that will use a quantitative approach.” Your introduction deals with the concept of market segmentation but there is a lack of understanding of what it is. As noted in the article that you cite by Venter et al (2018), market segmentation is not dividing a target market. It is the first step in what is referred to as STP strategy. This stands for segmentation, targeting and positioning. Market segmentation is the process of dividing a market, all actual and potential buyers of a product, into homogeneous groups. This can be done based on a number of bases including geographic, demographic, psychographic and behavioral as you mentioned. The objective is to identify groups that have similar needs/wants. Once the market is segmented, the marketer needs to determine what segment(s) to target. Not all are equally acceptable. In order to be useful, a segment needs to be measurable, accessible, substantial, and distinguishable/differentiable. That is, the segment needs to be of sufficient size and profitable to serve. You also need to be able to reach those in the segment and distinguish it from other segments. Once the market is segmented, the organization needs to evaluate the segments and decide on their strategy such as concentrated marketing targeting one segment or multiple segments. This is much more involved and complicated than you suggest and involves considerable research. The final step in the STP (segment, target, positioning) is how to position the brand in the minds of the consumer, typically relative to the competition. Again, this requires significant marketing research. You then attempt to link customer satisfaction to customer segmentation. Customer satisfaction, customer loyalty, and performance of an organization are all very different concept and independent of market segmentation. For instance, an organization could conceivably practice mass marketing with no segmentation and have satisfied customers. You need to demonstrate your understanding of customer satisfaction, how it relates to customer loyalty, and how that relates to both market segmentation and organizational performance There is considerable research on all of these concepts that need to be reviewed if you intend on linking this to your research questions. As it is, it is not clear what the role of customer satisfaction is in your research problem and subsequent questions. As you move into the statement of the problem, you then go into an explanation of controllable (marketing mix) vs. uncontrollable variables in the development of marketing strategy. You also make a number of assertions that are not supported by evidence such as whether a firm should develop a different promotion messages for a segment. A firm not only develops a different promotion message but a different product offering for the segment. That is the objective of market segmentation and targeting. Overall, it appears that you need to learn more about marketing and the development of marketing strategies. You cite a number of studies, but they lack integration and cohesion. The most critical issue with the proposal is that there is no support for the problem. The School of Business Prospectus Template was required reading for the week’s assignment since it provides important information with respect to what is required in the statement of the problem and purpose. As noted in the Prospectus, in order for your problem to be viable, you need to provide documentation that experts in the discipline believe that the problem is worthy of scholarly research. No such evidence is provided, and the review of the literature is scarce and lacks focus. In short, there is no documentation that a study on the relationship between market segmentation and financial performance is worthy of scholarly research as required. It is also not clear why this would be particularly warranted in the technology sector. You would typically find this at the end of an article on suggestions for future research. If you have not read the School of Business Prospectus template that is required reading for the week, you need to make sure that you do so, focusing on the requirements for a problem to be viable as well as what is to be included in the purpose. It is also critical that you look ahead to the signature assignment in which you will come back to this in the formation of a research proposal based on the problem, purpose, and research questions. The next assignment requires that you provide methods of observation for three situations provided. It is important that you read the text and apply the information explaining not just the pros/cons of a particular method but why it is appropriate in the given situation, as well as provide a detailed explanation of the procedure you would use. In the second part of the assignment, you are to familiarize yourself with the A-Z databases at the library and examine what is contained in each. In this case, you are looking for statistical information from a source such as Statista. This is not about finding information in journal articles in which primary data was collected. Finally, you are to comment on whether observation or secondary data would be useful in your intended research, given your research questions. I understand that it is generally appropriate to include introductions and conclusions on papers and assignment submissions. After teaching this course for some time, I’ve come to the conclusion that this is not necessary in assignments 2-7. As you will note, these are not typical papers but are either multi-part assignments or in the case of 6 and 7, the evaluation of something. As a result, introductions typically involve the reiteration of the assignment instructions that takes up valuable space. It makes sense just to eliminate these and organize the assignments using headings and subheadings consistent with APA formatting. Let me know if you have any questions on this, the feedback on the assignment or as you work on the next. I’m available for questions if there is any confusion as to what the assignment is asking or content. I also recommend that you look ahead to the signature assignment that will bring you back to your problem in the design of a research proposal. Dr. P
Effect of Market Segmentation on Financial Performance for Technology Firms
Submitted to Northcentral University
Graduate Faculty of the School of Business in Partial Fulfillment of the Requirements for the Degree of
Doctor of Business Administration
by Author
San Diego, CA
May 2020
Table of Contents
Brief Review of the Literature 7
Market segmentation criteria 7
References…………………………………………………………………………………8
Introduction Comment by Susan Petroshius: Note: you want to make sure that you are adhering to APA formatting in these assignments. For instance, APA requires that the entire document is double-spaced with no additional spaces between sections/paragraphs as you have here. Also, while you seem to be following the formatting in the Prospectus Template, APA does not have an introduction heading (strange, isn’t it?) I recommend you go the ASC and Academic Writer. If you go the section on “learn” there is a tutorial on basic setup.
The technology industry is one among the most important industries in the world presently. Indeed, electronic devices have become an integral part of human life especially since the turn of the 21st Century. Besides electronics, technological improvements in areas like medicine have led to better and more effective treatment procedures for previously difficult diseases. Against this background, one can conclude that technology companies are essential in the present and future human existence. Similar to any other companies, technology companies face the need to adopt certain strategies that will enable them to exploit their full potential in terms of sales and revenue generation. One such strategy is market segmentation. Comment by Susan Petroshius: Source? It is important to remember that you need to provide support for the assertions that you make. This is critical in scholarly writing. Comment by Susan Petroshius: Where is it suggested that this is critical in this industry. Note that I’m not suggesting that it is not but you need to show that experts in the field believe this is the case.
Venter, Wright and Dibb (2018) defined market segmentation as the dividing of “a target market” into smaller and better-defined segments. For example, a technology company could divide its customer base along the lines of demographics, location, and needs. This way, the company is able to make better decisions for better customer satisfaction. In their analysis of market segmentation, Dolnicar, Grün and Leisch (2018) noted four types of market segmentation. Comment by Susan Petroshius: Source? Comment by Susan Petroshius: This needs to be part of the next paragraph where you are explaining the 4 types is discussing or you have to be citing the source.
In the first place, there is demographic market segmentation such as in terms of age, income, location, annual income and more. The second type of market segmentation is psychographic segmentation. This entails segmentation of the market based on personality traits, values, lifestyles, priorities, attitudes and more. The third type is behavioral segmentation that entails purchasing habits, brand interactions, user status, and spending habits. Lastly, there is geographic segmentation, which entails segmenting markets in terms of ZIP code, country, climate, and whether the customers are urban or rural.
Market segmentation, according to Cross, Belich and Rudelius (2014) is especially crucial for marketing managers. The marketing department of an organization is responsible for pushing sales, and in turn, it influences the organization’s financial performance. In particular, marketing managers use the market segmentation strategy to create marketing messages that are stronger, as well as building a deeper customer affinity. In the end, the organization is able to service its customer base better, which leads to better financial performance. This assertion is in line with an analysis by Belás and Gabčová (2016) that established a positive correlation between customer satisfaction and financial performance of organizations. Comment by Susan Petroshius: There seems to be some confusion about basic marketing. Segmentation is the process of dividing the market (all actual and potential buyers of a product) into homogenous groups where the product can be developed to meet the unique needs of that group/segment. The idea that marketers “push sales” is one that is inconsistent with current marketing thought and hasn’t’ been in since the 50s with the introduction of the marketing concept. This suggests that the focus of marketing in on creating consumer needs/wants and to do so more efficiently and effectively than competitors. Today and focus on marketing strategy in on creating customer value. Comment by Susan Petroshius [2]: Source? Comment by Susan Petroshius [2]: These are very different concepts.
Statement of the Problem
The financial performance of organizations is critical to their existence, and as Rodriguez-Fernandez (2016) noted, it speaks volumes about the nature and effectiveness of the organization’s governance. However, many organizations find it difficult to understand the meaning and impact of market segmentation on their financial performance. Organizations are torn between using market segmentation to increase their competitive advantage or to use sub-markets to promote products/services such that they cater to the needs of different customer groups (Bruwer, Roediger & Herbst, 2017). Comment by Susan Petroshius [2]: This article provides some good information on the concepts surrounding market segmentation. The study was not, however, what this study was about. It tested a domain specific research instrument for purposes of segmentation.
Organizations encounter various variables, some of them being controllable while others being uncontrollable. Controllable variables include price, advertisement, and product/service. The uncontrollable variables include consumer behavior, the economy, competition, and other extraneous variables. In the technology industry, market segmentation is essential for better financial performance. Technology firms identify segments in the market, the composition of the segments, as well as their needs. To this end, the technology firms encounter problems such as if market segmentation allows them to develop certain products/services. Another problem that organizations encounter is whether they should develop a promotional message for each market segment or not. Comment by Susan Petroshius [2]: Source? You need to be providing sources for your assertions. Comment by Susan Petroshius [2]: Where is this suggested? You need to provide source. Comment by Susan Petroshius [2]: Source? Comment by Susan Petroshius [2]: These are not research problems. You are to be identifying
Purpose of the Study
The purpose of this quantitative study is to establish the effect of market segmentation on financial performance for technology firms. Specifically, the study will focus on technology companies in the United States. Simple random sampling and document review will be used to collect quantitative data. The data that will be used in the study include financial statements of the selected companies in the 2018/2019 financial year and the market strategies that the companies use. The study will adopt a descriptive research design because it is ideal for describing phenomena (Bell, Bryman & Harley, 2018). Besides, a descriptive study does not require a researcher to manipulate any of the variables. Comment by Susan Petroshius [2]: You have not provided support for this in the problem statement. Comment by Susan Petroshius [2]: Rationale?
Research Questions
To examine the topic, two research questions will be guide the researcher during the study.
i. What kind of relationship exists between market segmentation and financial performance of technology firms in the United States?
ii. What effect does market segmentation has on the profitability of technology firms in the United States?
Hypotheses
The following hypotheses will guide this study:
H10.
: There is a positive relationship between market segmentation and financial performance.
H10.: Technology firms that adopt a market segmentation strategy are more profitable than the ones that do not adopt this strategy.
Brief Review of the Literature Comment by Susan Petroshius: One article does not constitute a review of the literature.
Market segmentation criteria Comment by Susan Petroshius: Regarding of the style of formatting such as APA, MLA, etc., a subheading in only used if there is more than one. If there is only one, it is not necessary.
According to Venter et al (2018), organizations perform market segmentation differently based on certain criteria. Depending on the criteria, the primary outcome desired is the ability to avoid the risks ineffective business strategies. Organizations such as technology firms divide their market based on certain characteristics that are key to better performance. Such organizations might create a generic strategy that is then replicated across all segments (Liu, Liao, Huang & Liao, 2019).
Specifically, dividing the customer base into smaller segments enables organizations to target the customers better and to respond to changes in tastes and preferences. Liu et al (2019) argued that the best criteria for market segmentation takes a multiple criteria approach. To this end, organizations combine “preference analysis and segmentation decision” to identify the best approach that will enable them to achieve the set objective such as financial performance. Comment by Susan Petroshius: This is a complex study in which the authors propose a procedure that will result in information on the pros/cons of alternative products in different segments on multiple criteria. It requires that marketing research be conducted in which respondents have to provide pairwise comparisons of alternative products on a number of criteria. They provide an example of how this is done using 24 alternative car models and also suggestions for future research that are not related to the study you are proposing. Their purpose is only to present an alternative approach to traditional pairwise comparisons.
Research Method Comment by Susan Petroshius: This is premature and not part of this assignment. For instance, sampling approaches will be studies later in the course.
The proposed method for this study is descriptive in nature. Since the goal of the study is to establish the effect of market segmentation on the financial performance of technology firms in the United States, the researcher will use available information like financial statements, earnings calls, and market sentiment to describe the phenomenon. In particular, the study will choose a specific technology company using a random sampling technique for use as a case study. The need for a random sampling technique is to ensure that the study achieves internal validity.
Data will be collected via questionnaires and by reviewing relevant documents. The need for questionnaires is to obtain information about the company’s strategy. In addition, the choice of questionnaires is because they are cheap to prepare and to administer. On the other hand, document review is the easiest way to get relevant information. The choice of this data collection method is also based on the fact that many American tech companies are publicly traded and that their financial information is easily retrievable from the internet.
Measurement Comment by Susan Petroshius: What is contained here is not measurement.
The study will collect data primarily through document review and questionnaires. For the purposes of analysis, the study will use simple statistical analysis techniques as well as statistical analysis software.
Summary Comment by Susan Petroshius: This would be a first level centered heading.
This study intends to find out the effect of market segmentation on financial performance of technology firms based in the United States. The proposed research method is quantitative, with a descriptive study approach. The study will collect data through questionnaires and review of publicly available documents that have relevant information.
References
Belás, J., & Gabčová, L. (2016). The relationship among customer satisfaction, loyalty and financial performance of commercial banks. E+M Ekonomie a Management, 19(1), 132-147. doi:10.15240/tul/001/2016-1-010
Bell, E., Bryman, A., & Harley, B. (2018). Business research methods. Oxford university press.
Bruwer, J., Roediger, B. & Herbst, F. (2017). Domain-specific market segmentation: a wine-related lifestyle (WRL) approach. Asia Pacific Journal of Marketing and Logistics, Vol. 29 No. 1, pp. 4-26. https://doi.org/10.1108/APJML-10-2015-0161
Cross, J. C., Belich, T. J., & Rudelius, W. (2014). How marketing managers use market segmentation: An exploratory study. Proceedings of the 1990 Academy of Marketing Science (AMS) Annual Conference, 531-536. doi:10.1007/978-3-319-13254-9_107 Comment by Susan Petroshius: This is odd. Is this from a text?
Dolnicar, S., Grün, B. & Leisch, F. (2018). Market Segmentation Analysis. In: Market Segmentation Analysis. Management for Professionals. Springer, Singapore
Liu, J., Liao, X., Huang, W., & Liao, X. (2019). Market segmentation: A multiple criteria approach combining preference analysis and segmentation decision. Omega, 83, 1–13. doi: 10.1016/j.omega.2018.01.008
Rodriguez-Fernandez, M. (2016). Social responsibility and financial performance: The role of good corporate governance. BRQ Business Research Quarterly, 19(2), 137-151. doi:10.1016/j.brq.2015.08.001
Venter, P., Wright, A., & Dibb, S. (2018). Performing market segmentation: A performative perspective. Marketing Performativity, 62-83. doi:10.4324/9781315300238-4