Stories from the streets: Be street smart<\/p>\n
JAKARTA (JP): There are only two kinds of people: those who
\nhave ATM cards and those who do not.<\/p>\n
At least that is what Bagus T., the owner of a business that
\nsells public transportation tickets through Automated Teller
\nMachines (ATMs), believes.<\/p>\n
There are 210 million people in Indonesia -- only 5 million of
\nthem are ATM cardholders. A mere drop in the ocean. Besides, not
\nall of them are frequent travelers of trains, planes or ships.
\nBut Bagus operates his business on the assumption that most
\npeople in Jakarta today have ATM cards and some of them use
\npublic transportation. They are Bagus' targeted markets -- the
\nATM cardholders that travel.<\/p>\n
How does he reach such a narrow market segment? He designed a
\nsystem that enables the cardholders to buy tickets through the
\nATMs, the way people now purchase cellular phone vouchers. A
\ncustomer can easily exchange the ATM receipts with the actual
\ntickets at the airport, railway station or seaport.<\/p>\n
In order to provide the service, Bagus cooperated with Bank
\nCentral Asia (BCA), train company PT Kereta Api Indonesia, flight
\noperators as well as other businesses that need ticketing sale.<\/p>\n
Bagus' company, Expert, is a fledgling business, but judging
\nfrom the clearly defined market segment that he is targeting, it
\nhas a fair chance of succeeding. Most marketing manuals today
\npreach the wisdom of aiming at very segmented markets -- in fact,
\nthey say securing a segmented market is as good as achieving 60
\npercent success.<\/p>\n
Many companies do not fare well because they are set up
\nwithout clearly defining their market segments. Traditional
\nwarung (food stalls or small shops) have been managed in such a
\nway for so long, the owners think that as long as the stalls and
\nshops are open, customers would come in and find what they need.
\nWhen there are many customers, its fine and good, and the owners
\nare thankful, but when business is scarce, they think it's fate.<\/p>\n
Such an approach to business lends a greater chance of failing
\nthan succeeding. No matter how hard one works at promoting one's
\nbusiness, no matter how much money one spends, not many of the
\ntargeted customers would know of the product .<\/p>\n
This is because there is no clear definition of the targeted
\nmarket. Marketing experts would liken such a business approach to
\na cowboy who fires his gun in any which direction, and manages to
\nhit only one or two.<\/p>\n
Fortunately, most cowboys would, over the course of time,
\nlearn to shoot well and more effectively. As have Betty and her
\nhusband, the owners of MM Juice outlets in various upscale
\nshopping centers such as Pasaraya in South Jakarta.<\/p>\n
The couple opened their first fruit juice counter in the
\npopular Melawai shopping area in South Jakarta in 1988, and soon
\nmade a great sale. Their optimism soaring, the couple
\nindiscriminately opened up branches in any location they could
\naccess. Any offer of a joint business was taken up without much
\nconsideration.<\/p>\n
Over the years, Betty and her husband have had to close as
\nmany as 75 MM Juice outlets in various places of Jakarta because
\nof poor sale. They learned, then, that not all locations are good
\nlocations for business. They realized that the more successful
\noutlets are those located in rather posh shopping centers, and
\nthat their market segment is the more affluent shoppers because
\ntheir fruit juices are relatively more expensive than the others
\nin the market.<\/p>\n
Twelve years after they first entered the business, Betty and
\nher husband now decide how, where and when to expand their
\nbusiness more carefully. Now the owners of 25 MM Juice outlets,
\nthey know that to open new counters, a segmented market is needed
\nto ensure at least 90 percent success.<\/p>\n
Betty and her husband have advanced from owning a mass
\nbusiness -- that is characterized by indiscriminate marketing,
\naiming at satisfying various groups of customers -- to one that
\nis efficient and segmented.<\/p>\n
There are actually many ways of segmenting the market. Bagus'
\nmarket segment is a group of people with similar financial
\nmanagement (people who save their money in the bank and withdraw
\nthrough ATMs), and who travels. This particular segmentation is
\nknown as one that is based on customer habits; there are
\nsegmentations that are based on age groups, gender, needs,
\nprofessions and others.<\/p>\n
The more elements that are used for segmentation, the better
\ndefined will the segment be. This is because two women with the
\nsame income may not necessarily be in the same market segment for
\na product. One woman may think her money is better spent on books
\nthan on cosmetics -- she would then be in a different segment
\nthan the other woman who loves branded clothes, likes to eat at
\nexpensive restaurants, and collect CDs.<\/p>\n
The better those characteristics are recognized and defined in
\na market segment, the greater chance a business will have of
\nsucceeding. Segmentation, however, is not the only factor for
\nsuccess; differentiation is sometimes a key.<\/p>\n
A good example of this concept would be book publishing. Those
\nwho survive are those who understand their segments -- which is
\nwhy there are specialists in management manuals, religious books
\nand school textbooks. A publisher that tries to deviate from its
\nsegmented market usually risks failure.<\/p>\n
The Gramedia Group of publishers survives because each of its
\nunits serves their own segments. The units do school textbooks,
\nmanagement books, social and political books and others.<\/p>\n
A closer look at today's business scene would tell us that
\nmore and more companies are working on segmented markets. Some of
\nthe more recently established radio stations, for instance, cater
\nto the over-40s, the young or women only. There are also radio
\nstations that serve only young professionals who commute and need
\nimmediate information on the traffic and latest news.<\/p>\n
Our leaders in the executive and legislative bodies would do
\nbetter to learn and understand their market segments, namely
\ntheir constituents, when issuing statements and formulating
\npolicies.<\/p>\n
-- Tjipto Ramuni<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/stories-from-the-streets-be-street-smart-1447893297", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }