Behavioristic Segmentation
Zimmermann- a name that got associated with resort wears and particularly swimwear for the past 26 years. Founded in 1991, by the sisters Nicky and Simone Zimmermann in Sydney, Australia, the brand has reached the elite colonies of London, Paris and New York.
It is vital for any company to identify and go to the depth of the problems faced by it to stay alive in the market. In order to solve a problem, it is necessary to define clearly, what the problem is (Baker 2014). With the increasing impact of globalization, reaching out to consumers worldwide has become easier on one hand but on the other, it has also increased the challenges. In this age of globalization, entering a foreign market and making a mark has become a big challenge for a brand like Zimmermann.
In the year 2011, the first store of Zimmermann was opened in the United States of America. It was a big step for the Australian fashion giant but it also created a political tension in the fashion world of America, as many were not willing to accept a foreign brand. The USA is one of world’s largest fashion hubs and there are plenty of fashion brands already for the consumers to choose (Steenkamp 2014). Moreover, there is a difference in the climatic conditions of both Australia and the US and hence it is difficult to create a clothing line that caters to the needs of both populations. To a big name like Zimmerman, it is vital to address these issues to expand their business not only in the US but in other countries as well. Nonetheless, Zimmermann did succeed in establishing a name for itself with its unique collection of ready-to-wear attires and swim wears in particular.
An organization, a company or a firm establishes itself through various processes that define the market. It is essential for any company to first identify the target consumers suitable for its product. This can be done by proper segmentation of the market that is dividing the consumers into different groups as per their choices and needs. Earlier, cost was the only base for the production and distribution of commodities rather than consumer satisfaction (Boone and Kurtz 2013). The scenario has changed completely in the present world where companies try everything to lure and keep customers for longer time. The market segmentation is an important tool for this purpose, which has been realized by all.
There are different ways to segment the market, some of which include behaviorist, psychographic, geographic and demographic. The report discusses the three main segments that are behaviorist, psychographic and geographic (Wedel and Kamakura 2012).
Market segmentation is done in a way that it satisfies the elements of marketing mix as well (Hassan and Craft 2012). It also defines how the different bases of market segments are distinct from each other. The given report analyzes the various segments and also explains the basic differences between them as per the marketing mix elements.
Psychographic Segmentation
The consumers are grouped depending on their unique behavioral pattern they show while purchasing any product. This grouping of consumers based on their behavioral pattern and creating a product to match it falls under the behaviorist segmentation of the market. The company observes the consumer behavior like what they consume more, how and where they spend their money, their style of living, their priority amongst others (Li, Li and Kambele 2012).
There are several forms of behavioral segmentation such as the buying on occasion. It implies that the consumers buy certain products only on some particular occasions. The next is the status of the user that a consumer’s loyalty to a certain product. To attain consumer loyalty, companies first target new consumers and devise ways to keep them. This depends upon the services provided to the consumer (Alexandra 2013).
This base of segmentation is best suited for a brand like Zimmermann especially the spending and lifestyle of the consumers. Mostly, the comfort seekers get attracted towards a brand like Zimmermann as it offers a range of comfortable clothing. Zimmermann’s prime target is the women worldwide but apart from that, they have also focused on the different buying patterns of the women. To provide an instance, it was the first brand in Australia to introduce a collection of printed lingerie in 2001.
The more the world is moving ahead, the more ways of attracting consumers are being exposed. The psychographic segmentation is an example of such a trend. Marketers have found ways to read the psychology of the consumers and then create products that best suits them (Gunter and Furnham 2014). This type of segmentation promotes the fact that people’s attitudes, their standard of living and their personal traits influence their buying decision.
Lifestyle, social status, attitudes, values and personality are the chief factors define the psychographic segmentation. The fashion industry utilizes this segmentation mostly as clothing is one of the most important aspects of a consumer’s lifestyle. In case of Zimmermann, the above statement is best suited. Since its inception in 1991, the brand has catered to the needs of women with distinct personality across Australia and most of the western world (Zimmermannwear.com, 2017). The company was launched a separate line of clothing for the kids thus targeting the psychology of the fashion loving mothers. This move also displayed the ability of the company to discover new market.
This type of segmentation is done by gathering and analyzing the information as per the geography of the consumer. Geographical segmentation means the division of consumers based on the region, city, country, climate and population. It is one of the most common and fundamental market segmentations. Geography is a key aspect that companies keep in mind while launching or selling their product (Sandy, Gosling and Durant 2013).
The location of consumers plays an important role in defining a product’s success. To give an example, Zimmermann’s swimwear collections cannot be successful in the middle and south East Asian countries as the society there is conservative and orthodox. In addition, the taste for fashion differs from region to region even of the same country. Climatic conditions of different areas also influence the buyer’s choice. Buyers belonging to a hot and humid area might not prefer clothes made of synthetic or other repulsive material. The choice of buying also depends upon the population of an area. Zimmermann, for instance targeted the US for its first overseas store, as it knew that the larger part of the population would prefer the kind of clothes they make.
Geographic segmentation
In the world of marketing, certain principles govern the way marketing is done. Marketing is an ever-growing field and many changes have occurred since. To define the marketing mix in simple language, it is an instrument used by marketers and businesses alike to help decide manufactured goods or brand offering (Schiffman et al. 2013). E. Jerome McCarthy first proposed the four Ps of marketing mix in 1960.
Later on, however, with the rise in competition and options, the four Ps were extended to seven Ps. The initial four Ps were- Product, Place, Price and Promotion. After Booms & Bitner proposed the extended and updated version of marketing mix in the year 1981, three more additions were made to the four Ps. These included, People, Processes, and Physical evidence (Gordon 2012).
The different segments of markets differ from each other although there end desire is the same- to attract consumers especially in terms of the marketing mix elements. Geographic segmentation of market cannot be possible without identifying the appropriate Place for selling a product. According to the principle of marketing mix, the availability of any product must match the consumer’s convenience. However, in today’s world, with the advent of e-commerce, the boundaries have blurred and a wide range of products could be availed from anywhere in the world. Still, there are limitations as in one cannot buy a product online from another country. The companies must keep that in mind and create products that gratify the needs of consumers of a particular geographic area.
Behavioral Segmentation, unlike geographic segmentation, focuses more on the buying behavior of the consumers (Solomon 2014). Companies create the Product- the first marketing mix element- in a way that it fits the task expected by the consumer. In simpler words, consumers seek benefits from every product they use and companies study this behavior of the consumers and make specific products based on their research. Through the product, companies can not only acquire consumers but also earn their loyalty towards it.
The Psychographic segmentation differs from other two bases in the sense that it targets the personal traits of the consumer. In order to sell a product, a company has to promote it first and in order to promote a product; the company has to understand the psychology of its customers. Every customer has a unique personality and companies via promotions target that personality (Kahle 2014). There is a wide spectrum of platforms for companies to promote their product nowadays, the most effective being the social media. The promotional tool must be applied to convey the company’s message to the correct consumers in a manner that hits their emotional quotient. This cannot be achieved without the psychographic segmentation.
Pricing is an important component in a marketing mix strategy. Pricing is considered very important since it ultimately decides the placing or positioning the product. Pricing also has implications on the other components of marketing mix such as people, promotion and others (Gordon 2012). Pricing is the only element, which in actual sense influences the turnover rate of a firm. According to some marketing experts, pricing is supposed to be a very onerous concept. Faulty pricing can lead to drastic reduction in the sales ratio of the firm. A successful firm must design their pricing strategy upon some important factors. Some of the important factors are the prevailing competition in the market, the business motives of the firm, the prospective customers of a particular product and their inclination to purchase the product. There are many concepts of pricing strategies available to the marketing experts. Generally, a firm chooses a pricing strategy, which is most compatible with the business objectives of the firm (Nagle, Hogan and Zale 2016).
Marketing Mix
Zimmermann is an Australian fashion company. The two sisters Simone Zimmerman and Nicky Zimmerman established the company in the year 1991. Going on still strong after a period of two decades, Zimmerman has positioned itself as a notable fashion accessory company both in Australia and worldwide. Zimmermann is famous for their effortless swimwear and ready to wear collection. Women of all age love Zimmermann because the brand’s collections have stayed committed to their authentic, cosmopolitan and passionate designs. Zimmermann clothes are stylized to be in harmony with the breezy and chic Australian style (“ZIMMERMANN | The Official UK Website Of The Designer Collections”, 2017).
Zimmermann offers the buyers an extensive range of clothes in terms of price, cuts, materials and others. In terms of price, Zimmermann has low range dresses, mid range dresses and high-end dresses. Everyone can avail dresses from the Zimmermann brand according to their purchasing power. The two sisters have always wanted their brand to create an affirmative image in the minds and hearts of all women irrespective of class, age, race and status (Saunders 2015).
Australia is renowned for warm weather and sunny beaches. Simultaneously, fashion in Australia appears to be smart, light to wear, colorful and breezy. There are many famous beaches in Australia, such as the Bondi beach, Mandalay beach, Cable beach, Whitehaven beach and others. Australians love the beaches. Water sports are extremely popular in Australia. Therefore, swimwear is a staple item in every Australian’s wardrobe (Booth 2012). In Australia, the swimwear collection of Zimmermann is unrivalled in the fashion world. The Zimmermann sisters are pioneer in designing various types of swimwear collection starting from one piece swimsuit, monokini, thongs, printed string style bikinis, frill style bikinis, ruffle style bikinis, crochet style bikinis and other equally interesting swimwear pieces. The key feature of Zimmermann bikinis is that they accommodate all types of female body shapes and statures and give these women the chance to enjoy a sunny sojourn (Schmidt 2013).
Proper pricing is essential in the fashion industry since it creates a direct impression on the positioning and profitability of the concerned brand in the market. Zimmermann is an established fashion brand in the market, so it can follow the product line pricing and value based pricing strategies. It is evident that Zimmerman has projected a valuable perception in the public eye. It must provide value for money to the customers by creating a cautious mix of cost and standard. Zimmerman fosters everlasting relationships with their customers, which propels brand loyalty. Though Zimmermann enjoys durable brand loyalty, they must update themselves with the ever-evolving customer needs and demands. Quality must not be compromised and price must be within an accessible reach. Customers become willing to purchase the products if the brand value appears to validate the high cost (Grewal et al. 2012). Zimmermann can also incorporate the product line pricing strategic concept in their portfolio. Products are priced according to their features in the product line-pricing concept. However, prices may differ, but all the products must be categorized within the similar product span. The diverse swimwear range of Zimmermann can be described as an example. Zimmermann designs various sorts of swimwear ranging from ordinary two-piece bikinis to lacy-patterned stylish one pieces. Ordinary Zimmermann bikinis can be priced within the normal range. The extra stylish swimsuits can be priced in the high range because it offers the buyers a better fit and style. Hence, products with more striking features are high priced than the ordinarily designed products. The branded value of the products undoubtedly makes it pricey; nevertheless, the characteristics of the products must also be an important parameter in setting the price. Product line pricing is a sort of price differentiation. This price differentiation would facilitate the fashion firm to amplify the profitability ratio. Pricing strategy for a firm must be designed with utmost care since unlike the other marketing elements; it is not expenditure but a source of revenue and a guarantor of profits (Smith 2012).
Value is the considerate driving factor in all the important business settlements because value determines the exact cost, which the customers are willing to pay in return for the comforts delivered by the firms. Value based pricing offers an accurate measure of the value of the company, which will help to hold their buyers. The buyers develop a feel that they are fairly charged in accordance to the correct value of the product purchased. This also further gives the company an extra merit over the competitive firms as the prices are set in terms of the value received by the buyers. Value based pricing strategy would enable the concerned firm to cut off cost-driven buyers and lure in new buyers from the competitor firms. Therefore, Zimmermann would enjoy numerous positive outcomes if they adopt the value based pricing strategy (Hinterhuber and Liozu 2012). Product line pricing strategy also brings in positive outcomes for the firm. Women of all classes can avail classic Zimmermann bikinis as long it is permitted by their purchasing power. Zimmermann would become a more accessible brand to people all around the world. Customers would have an enjoyable shopping experience with Zimmermann, as there is always something available for someone according to their choice and preferences. Firms, which keep all ranges of products in their portfolio, generally, earn more profits than firms engaged in single range products. The market base of Zimmermann would have a universal appeal. Resultantly, this will increase the goodwill and brand recognition of Zimmermann. The implementation of these two pricing strategies will drive Zimmermann to new heights (Baker 2014).
Value based pricing strategy and product line based pricing strategy help to minimize cutthroat competition among the firms producing similar products. Value based pricing strategy and product line based pricing strategy has an illusion of achieving immediate success in the business scenario. In reality, it is very difficult to achieve quick success with value based pricing strategy. Firms have to price their products astutely to gain huge profits under value based pricing strategy. Value based pricing strategy when adopted by a firm can very easily puzzle competitors. Competitors would fail to outnumber the sales ratio of the concerned company. Eventually, when they try to copy the same pricing strategy in the short term by setting implausible low prices, they would inadvertently suffer huge losses. Therefore, the other fashion firms would not gain much with mere short term copying of the pricing strategy of Zimmerman. In order to make value based pricing strategy perform productively, the competitive fashion firms have to respectively implement smart and perspicacious pricing in sync with their product value in the long term perspective (Jiang et al. 2015). Product line pricing strategy would also give Zimmermann an added benefit over other competitive firms because it would enlarge and widen the market base of Zimmerman. Overall, value based pricing strategy and product line based pricing strategy would contribute to a sustainable competitive advantage. The competitors cannot possibly copy it in the short term (Piccione and Spiegler 2012).
Conclusion
To conclude, it can be said that proper analysis and research of the market is required to survive. Zimmerman is one company that has displayed most of the qualities of market research and it is evident from its success story. The above report laid stress on the various aspects of the marketing world with special reference to Zimmermann. Specializing in swimwear, Zimmermann sisters- Simone and Nicky- have successfully applied all the bases of market segments to popularize and expand their brand (Schmidt 2013). They have revolutionized the Australian fashion world in a way that no one ever did. The buyer targets may alter; behavior and psychology of customers may also change, but Brand Zimmermann is here to stay and stay for quite a long time.
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