Targeting and segmentation is the process by which a company focuses marketing activities regarding a particular product to a defined customer profile.

Certain criteria like income, age, location, culture and so on can be used as a basis for segmentation.

Basically the question that segmentation and targeting answers is - Who am I trying to reach?

In the given scenario the bicycle repair company conducted segmentation research and then targeted their direct mail coupons for a first bike tune-up to that identified customer segment.

So they answered who they want to sell to.

8 0

2 years ago

matthew's fish fry has a monthly target operating income of $7,200. variable expenses are 60% of sales and monthly fixed expe

slamgirl [31]

Given, Operating income = 7,200

Fixed expenses = 1800

Let the target sales be assumed to be X

Sales = 7200 + 1800 + 0.6*Sales

X = 7200 +1800 +0.6X

X-0.6X = 9000

0.4X =9000

X = 22,500

Target Sales = 22,500

Break even point = Fixed Costs/(Price -Variable cost)

Break even point = 1,800/(1-0.6) = 1,800/0.4 = 4,500

Break even point =4,500

Margin of Safety = (Target sales - break even point)/ Target Sales

Margin of Safety = (22,500-4,500)/22,500 = 18,000/22,500 = 0.8 = 80%

Margin of Safety =80%

7 0

3 years ago

Read 2 more answers