Chapter 8- Segmenting and Target Markets

 

Market Segmentation

Digicel has two main segments, personal users and business users. The users also fall into further important classification; prepaid and postpaid.  Prepay customers pay for their services in advance via top ups, credit vouchers.  Currently this is the largest segment of customers accounting for 69% of the St. Lucian mobile market, compared to 31% of customers who pay bills at the end of the month.

Personal Users

·         Young Professionals- This represents about 11% of Digicel's customer base. They tend to use their mobile devices conscientiously, usually keeping to a budget and not involved in a lot of the gaming and internet products.

·         Second/Third Level Students

This group represents about 9% of Digicel's customer base and is comfortable with technology. They use their phones for downloading video-clips, games , ring tones, instant and picture messaging. 

·         Teenagers

This group represent s about 17% of Digicel's customer base. They are technically savvy users interested in internet services, instant messaging, games, ringtones, and downloads, their demand will be in keeping with technological advances.

·         General Public- can be swayed to purchasing technology to suit their pockets.

 

Business Users

As we have established the number of business users is smaller but amongst this segment mobile phone usage is much higher. The majority of these users are bill pay customers. Within this segment there are two main groupings:

·         SME-  Small/Medium Enterprise-  These are companies which have less than 100 employee and start up/ young companies still growing. These companies are more budget conscious and an increasing number are waiting on prepaid deals.

·      Corporate-  These are larger companies employing more than 100 people.  These organizations have very specific requirements and have greater demand for non voice products.  These are major user of data devices, which provides on the go access to emails and internet.

 

 

Target Marketing Strategies

 

Socio-cultural factors: These factors consist of variables such as: population demographics, rising educational levels, norms and values (customs), and attitudes toward social responsibility. In terms of population demographics, Digicel target basically all age groups. The products and services that are offered gains the interest of young adults and older persons (e.g. internet, Blackberry services, overseas call plans, roaming etc.) The company has also targeted all areas of the island, with island wide coverage and retail locations at all major towns. The rise in educational levels ties in with the advancement of technology. Persons are now using their smart phones to conduct business they would normally conduct with a desktop or laptop computer. In terms of norms and customs, the introduction of Digicel to the St. Lucian market, has led to the common man owning and operating a mobile phone, and most importantly at a reasonable cost. Now with social responsibility, Digicel continues to play a major role in the development of the communities and countries their serve.

Technological factors: Technology can change the lifestyle and buying patterns of customers and thus may affect the demand for  products and services, On the other hand, Technological changes creates new opportunities for the company to expand its services and remain competitive. Digicel realize that as technology evolves so does the demand of the customer. The company positions itself to take advantage of the changing demand to offer differentiated and up to the times services like, 4G data, cloud computing,  that continues to keep them competitive.

 

Economic factors: Digicel understands the state of the economy and attempts to offer value for money in its products and services. In general customers would like to have the best service at the lowest cost. Thus, the services and products that are offered by Digicel are in a cost range that allows them to be competitive.  The majority of its customers are prepaid , pay as you go customers.  In 2008 for example Digicel answered to the call of its prepaid customers for lower value of top ups as customers could no longer afford minimum top up values at XCD5.00.  The minimum top up value was changed to  XCD2.00 to allow prepaid customers to be able to afford to top up and keep connected to family and friends.

 

Socio-cultural factors: In terms of population demographics Digicel started out targeting the younger generation. However competition and changing customer demand has led to the company targeting all demographics and offering services to suit the different demographic segments.  For example Digicel Business was launched a product to target Business/Corporate customers  whereas prepaid data service would cater to the prepaid, teenager and young professionals who are pay as you go but wants to be able to have data functionality, internet on the go to stay connected to friends and family.