MRKT 5003 Module 2 Segmentation Analysis Example

Segments by When They Are Free: Sizing Five Buyer Groups for a Family Orchard and Choosing the Two Worth Serving

Student Name

American College of Education

MRKT5003: Marketing Management: Strategy, Impact, and Engagement

Module 2 Assignment

Instructor Name

January 29, 2028

Choosing the Variables

Module 1 found that Harwell Hill Orchard, a composite family farm in west Michigan, earns about 71 percent of its on-farm revenue in September and October, mostly on weekends when it is already at capacity, and that families come mainly for an outing rather than for fruit. The marketing problem is therefore one of timing, and the segmentation should divide the market on the variables that decide when a household could visit and why.

Dickson and Ginter (1987) defined market segmentation as a condition of demand: a segment exists only when a group's demand differs from that of other buyers, not merely when its members share a demographic label. Yankelovich and Meer (2006) similarly argued that segments should be built on the attitudes and behaviors that drive the purchase, not on demographics chosen for convenience. For Harwell Hill, the behavior that matters is visit timing, and the variables that predict it are household life stage and schedule flexibility. A segment that cannot come on a Tuesday is of no use to a plan that needs Tuesdays.

Five Segments, Sized

The first segment is weekend families with school-age children, households with at least one child aged 5 to 17 and working parents. Using census household tables for the composite 60-mile region, this group is about 118,000 households. It is the orchard's core: 64 percent of online orders include a child ticket, and most of them fall on weekends. The second is families with children under five, households whose youngest child is not yet in school, about 41,000 households. The third is elementary schools and organized groups; state school directories list 212 public and private elementary schools within 40 miles, a realistic field-trip distance, with about 58,000 students in kindergarten through third grade, the grades that most often take autumn farm trips.

The fourth segment is older adults, households headed by someone aged 60 or over with no children at home, about 164,000 households. The fifth is adults without children aged 21 to 44, about 97,000 households, relevant mainly to the taproom. The five segments together do not cover every household, and they overlap slightly, since a school group's students also belong to family households. The figures are therefore estimates of reach, not a partition of the market.

Evidence That They Differ

Size alone does not make a segment; each group must behave differently in a way that matters to the plan. The orchard's ticket records supply that evidence. Among last season's weekday online orders, 58 percent included a free ticket for a child under three, compared with 19 percent of weekend orders, which shows that families with very young children already make up much of the weekday trade without any marketing aimed at them. The orchard hosted 31 school groups last autumn, all on weekdays, almost entirely because teachers called on their own; the average group was 64 students and spent about $7 a student on admission, fruit and a donut.

Older adults are harder to see in the data because they tend to pay at the gate, but weekday market and bakery sales between 9 a.m. and noon, when school-age families are absent, average about $1,900 a day in October, with an average transaction of $31, larger than the weekend average of $22 and weighted toward bagged apples, pies and cider by the gallon. Adults without children appear in the taproom data instead, where late-afternoon and evening sales dominate and Friday is the strongest day outside the weekend. The weekend family segment, finally, is defined by the crowding pattern itself.

Testing the Segments

Wedel and Kamakura (2000) set out criteria that effective segments should meet: they should be identifiable, substantial enough to be worth serving, accessible through channels the firm can reach, stable over the planning period, responsive in a distinct way to marketing action and actionable with the firm's resources. Applying those criteria reveals why some large segments are poor targets for this plan.

Weekend families with school-age children are identifiable, substantial and accessible, but they fail the test that matters most here: their response to more marketing would come on weekends, which would only worsen crowding. Families with children under five pass every test. They are identifiable through parenting groups, libraries and preschools; substantial at 41,000 households; accessible through local parent networks and social media; and responsive on weekdays, as the ticket data show. School groups also pass. They are few in number but large in size, easy to reach through a school directory and district field-trip coordinators, stable from year to year and responsive to a program designed for them. Older adults are substantial and free on weekdays, but they are less responsive to the orchard's main product, since they come for fruit and baked goods rather than an outing, and they are harder to reach through channels the orchard already uses. Adults without children respond well to the taproom but mainly in the evenings and on Fridays, which fits the taproom's capacity rather than the farm's.

Targets Chosen

The plan will target two segments. The first is families with children under five, for weekday mornings in September and October and for weekday visits in the spring blossom season and the summer berry weeks. The second is elementary school groups, for weekday field trips in September and October, booked in advance through a structured program rather than by teachers' calls.

The three other segments are not targeted, for stated reasons. Weekend school-age families will continue to be served, but no marketing budget will go toward them because more demand would arrive at the wrong time. Older adults will be welcome, and the market's morning hours will continue to serve them, but the plan will not build offerings for them in its first year, because their main purchases, fruit and baked goods, are available at the farm market without a visit to the orchard. Adults without children are left to the taproom's own marketing, which is already reaching them in the evenings.

What the Targets Could Be Worth

A rough estimate shows why these two targets matter. If weekday visits from families with young children rose from about 2,100 households last autumn to 4,000, a reach of just under 10 percent of that segment, and each spent the weekday average of about $46 across admission, fruit, bakery and market purchases, weekday revenue would rise by about $87,000 in the autumn alone, before any spring or summer visits. If a structured field-trip program lifted school groups from 31 to 80 a season at about 64 students and $7 a student, it would add about $22,000. Neither figure is large beside $2.1 million of on-farm revenue, but both arrive at times when the orchard has idle capacity and staff already on the payroll, so most of it would reach profit. Module 3 will position the orchard for these two segments against the competitors that already serve them.

References

Dickson, P. R., & Ginter, J. L. (1987). Market segmentation, product differentiation, and marketing strategy. Journal of Marketing, 51(2), 1-10. https://doi.org/10.1177/002224298705100201

Wedel, M., & Kamakura, W. A. (2000). Market segmentation: Conceptual and methodological foundations (2nd ed.). Kluwer Academic.

Yankelovich, D., & Meer, D. (2006). Rediscovering market segmentation. Harvard Business Review, 84(2), 122-131.