Answer to Question #207723 in Marketing for banele

Question #207723

five ways by which loyalty status segmentation can enhance business.


1
Expert's answer
2021-06-17T12:44:02-0400

Businesses will always seek for customers who can be loyal to their products and services. Loyalty in business implies the relationship between the customers and the organisation's products and services. Customers will tend to stick to an organization whose products are attractive, of good quality and of good quantity. Consequently, loyalty status segment refers to the process of grouping customers according to the way they have trust with an organization. This act enhances business in the following ways.


It enables the business to understand it's customers better. The needs of the customers in different segments can be analysed and addressed effectively. Moreover, products may be modified as per customers views hence increasing the sales. This in turn maximises the company's profit.


Loyalty status segmentation enhances the company's focus. The company can be in a position to address the issues raised by a specific segment of customers. This may also be done through the issue of incentives especially to the segment that has trust in the business. Such acts will maximize the sales hence profit.


It reduces competition for market. The organisation which puts into practice loyalty status segmentation encourages the customers to stick to them. Consequently, customers will not shift even when other cheaper products of the same kind come into the market. This stabilizes the demand and enhances trust in the business hence the business grows.


Communication is meant for specific segments which reduces the expenses of a given organization. Instead of spending a lot of money on advertising the product, the company will target a specific segment hence low costs for product advertisement.


Loyalty status segmentation also promotes market expansion. People in a segment are a subject to growth. The more a given segment likes a particular product, the more they attract other people into the segment. This expands the market hence maximizing both supply and demand.



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