Firms use a differentiated targeting strategy because it is better than focusing on individual or small groups of potential custom banks are more willing to extend credit to companies with this strategic a most market segments are too small to be profitable. it helps obtain a bigger share of the market. it is easier than mass marketing.
The correct answer and explanation is:
Correct Answer:
“It helps obtain a bigger share of the market.”
Explanation:
A differentiated targeting strategy is a marketing approach where a company targets multiple market segments with different offerings, rather than focusing on just one segment (concentrated strategy) or appealing to everyone with a single product (mass marketing). The main reason firms adopt this strategy is that it helps them capture a bigger share of the market by catering to diverse consumer needs and preferences.
Companies use a differentiated targeting strategy to increase revenue opportunities by appealing to a broader customer base. By offering different products, services, or marketing campaigns tailored to various groups, firms can maximize their market coverage while minimizing the risk of relying too much on a single segment.
For example, an automobile manufacturer may produce economy cars for budget-conscious consumers, luxury models for high-end buyers, and SUVs for families. This strategy allows them to reach multiple customer segments simultaneously, increasing sales and market penetration.
Additionally, a differentiated strategy provides firms with a competitive advantage by reducing dependency on one segment, which can be risky if that segment’s preferences change. It also helps firms adapt to market trends and consumer behaviors, making them more resilient in fluctuating economic conditions.
Though this approach requires higher marketing and operational costs compared to a mass marketing strategy, the potential for higher sales and customer loyalty often outweighs these expenses. This is especially true in industries where customer preferences are diverse, and a one-size-fits-all approach is not effective.
Overall, firms use a differentiated targeting strategy because it helps them gain a larger market share, diversify their customer base, and achieve long-term business growth.
Here is the generated image illustrating a company using a differentiated targeting strategy, showing different market segments connected to tailored products and services. Let me know if you need any modifications!
