Market segmentation using modeling and Lotus 1-2-3

Normative segmentation is difficult because of cost versus revenue considerations. A Lotus 1-2-3 work sheet offers a convenient and ‘manager friendly’ way to select appropriate marketing mixes to target to various market segments. The model described was used by a sporting goods manufacture to design a marketing mix for a new product that would yield the greatest profit. The work sheet assisted the user by structuring complex issues such as opinion leader effects, competitive response, product cannibalization, and the effect of experience on cost reduction.