Fashion Channel Market Segmentation Essay

One of TFCs glaring strengths is that it specializes in mold-oriented programming. The comp whatsoever is dedicated to mien programming 24/7, meaning it is in a position to operate the trade. Secondly, TFC appeals mostly to women between 35 and 54. The partnerships viewing audiencehip in the fraction is 45% comp ard to 42% and 40% for Lifetime and CNN respectively. This category has the largest physical body of viewers and at the same time, one of those segments that is able to attract premium pricing. In addition, the company operates under the basic cable package. The package has more than 80 billion subscribers in the U.S meaning that a large number of sight have access to the channel.Conversely, TFC faces several weaknesses. Firstly, the company has non fully modify its operations it only specializes in fashion related programming. This could spell censure for the company, especially if the current trend is an indication of the future. Moreover, there is a office o f the top management that is reluctant to accept change in the organization. The hint is that Danas recommendations may fail to get ratified for fear of the unknown. Thirdly, the enjoyment level of TFCs customers is on the decline. The company is quickly losing customers to the dickens study competitors, and there are fears that the trend is sustainable. The other major(ip) weakness is that the organization has not segmented its securities industry. The company ought to segment its market in array to benefit from the premium fee charged for the highly valued demographics. in that location are a number of opportunities available for TFC in its external environment. To begin, advertisers are ready to pay a premium for higher grade as well as defined demographic programming. Channels with higher rating are able to charge more for advertising meaning that TFC keep gain additional revenue if appropriate strategies are developed to stand by increase its boilersuit market rating. Secondly, there is a more dwell for the company to increase its market size. Fashion specific programming is continually gaining prominence among viewers in the U.S. market. In addition, viewers penury on ne bothrk content and ad is directly related to the greet of advertisement. The company merchant ship thus increase its ad revenue by marketing strategies aimed at increasing viewership.One of TFCs predominant threats is its two chief competitors CNN and Lifetime. The two are constantly eating into the TFCs major revenue base, and may even force the company out of the market. The support threat is that TFC is only entitled to $1 per subscriber. This is quite a shrimpy portion that cannot fully sustain the companys operations. Besides, there is a threat that TFC may get dropped from the basic cable platform if subscribers gladness fails to improve. This may mean total loss for byplay. TFCs Central strategical IssueThe company appears to lack a clearly defined business str ategy. Thecompanys product-market focus is vague. For instance, TFC has not segmented its market into incompatible segments. Alternative Strategic Promotional Courses of ActionAlternative 1 in that location are a number of marketing courses of action at TFCs disposal. The first one, and perhaps most important, is market segmentation. The company should divide its market into different segments and concentrate on maximizing the revenue for the segment of choice. concord to the data provided in the case, a combination of Fashionistas (scored 23.1M) and Shoppers/Planners (scored 42.35M) segments appears the most economical alternate for TFC. The two categories of customers are highly involved in matters related to fashion and are thus a fitting target for the company. There is as well as economic benefit involved if the company opts to back the strategy.Firstly, an admixture of the two segments yields a high profit margin (39%) in comparison to any other alternative. Besides, the alternative go out trigger an increase in overall rating by 20%. There is a potential hook in the companys rating from 1.0 to 1.2 consequently leading to increase revenue. In addition, this segmentation has the highest percentage of viewers 50% (=35% + 15%). The large number of viewers in two segments is thus suitable for the company, especially given that it entirely specialize in fashion programs. The enigma with this alternative is that there is an increment in programming expenditure by $20 million.Alternative 2The second alternative is broad-based marketing. This involves treating the entire market as a single group typified by customers with shared needs. The prefer of this strategy is that it is quite profitable at to the lowest degree in the short-run. Its word sense is in all likelihood to earn the company a net profit of more than $40 million (=$94.9 54.6). In addition, the approach does not attract incremental programming expenditure. On the other hand, the broad-b ased alternative will deny TFC the hazard to earn premium CPM (Cost per thousand).Alternatively, TFC can opt for Fashionista segmentation. Using 2007 as abase year, the alternative may rake for the company at least a net income of $100 million (=151.4 54.6). In addition, the approach is likely to boost the companys overall rating from 1.1 to 1.2. The company will also be in a position to increase its charges from $2 to $3.5. Conversely, the Fashionista alternative will lead to an incremental expenditure of $15 million. c omit and Implementation PlanThe new promotional plan should be positioned towards a combination of Fashionistas and Shoppers/Planners segment. Although there are a number of risks involved in this strategy, the returns are investing in the strategy. One of the greatest challenges for the company is maintaining the unwavering customers while at the same time wooing new planners/shoppers and fashionistas. The company must come up with ways of ensuring that they do not lose some customers. This is achievable through evaluating the programs popular among the loyal customers and ensuring they are not disrupted by the new alternative.The company can also benchmark with its customers to learn how they are able to attract a huge number of fashionistas. The fact that the alternative may lead to incremental $20 million expenditure presupposes that its implementation is quite expensive. Benchmarking with Lifetime and CNN can help tighten up the cost. Finally, the company should devise ways to foster awareness, perceived value, and interest of its products among consumers. This can be achieved through online marketing and ensuring there is appropriate social media indemnity in place to avoid misuse of the marketing platform.