Modern customer segmentation and engagement strategies for SME

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Modern customer segmentation and
engagement strategies for SME

 

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Abstract



Purpose: This research project aims to Identify, describe and quantify the major
Raspberry Pi user segments. It offers a range of insight and reflection on the issue of
start-up to approach their segmentation, targeting and positioning strategy, when
entering in a new market.
Design/methodology/approach: An online survey was launched with the aim of
getting relevant answers related on habits of users of Raspberry Pi. By launching it
on platforms like Raspberry Pi Facebook and Twitter page 210 key answers were
gathered.



Findings: Participants to the online survey revealed interesting trends such as, being
mostly people coming from education with an Undergraduate or Postgraduate
degree, working already full-time in the technology industry. Furthermore, most
users use the Raspberry Pi mostly for hobby projects involving video streaming and
robotics. However, the people showing the most usage of the product revealed to be
teachers. In addition, the major part of the participant declared to use mostly
Facebook and Twitter as social media for interaction, and using “Company
sponsored websites/blogs/forums” and “Maker sites” as source of guidance for
projects.
Practical implications: This research provides insights to encourage entrepreneur to
use social media for seeking engagement and interaction with consumer, as the
most valuable cost-effective and communication channels for a start-up.
Originality/value: As being one of the few researches in this field, this piece of work
will provide insight on how to approach viable segmentation, targeting and
positioning strategy for a start-up entering in the software and hardware market
with a new technology such the Internet of Things.
4 Angelo Guida C1432680
Table of Contents
Declaration/Statement page………………………………………………………………2
Acknowledgments………………………………………………………………………………3
Abstract……………………………………………………………………………………………..4
1. Introduction……………………………………………………………………………………7
1.1 Background…………………………………………………………………………..7
1.2 Research focus……………………………………………………………………..8
1.3 Overall research aims and objectives…………………………………….9
1.4 Value of the research…………………………………………………………….9
2. Literature Review………………………………………………………………………….10
2.1 Introduction………………………………………………………………………..10
2.2 Segmentation………….………………………………………………………….10
2.2.a Segmentation concepts and principles……………………..10
2.2.b Segmentation strategies for a start-up in the hardware
and software market………………………………………………………..12
2.3 Targeting…………………………………………………………………………….14
2.3.a Targeting concepts and principles…………………………….14
2.3.b Targeting strategies for a start-up in the hardware and
software market………………………………………………………………16
2.4 Positioning and customer engagement………………………………20
2.4.a Positioning and customer engagement concepts and
principles…………………………………………………………………………20
2.4.b Positioning and customer engagement strategies for a
start-up in the hardware and software market………………..22
3. Methodology………………………………………………………………………………23
Angelo Guida C1432680 5
3.1 Research philosophy and ethics………………………………………….23
3.2 Research strategy and sample types…………………………………..25
3.2.a Questionnaire related strategy………………………………..25
3.2.b Sampling………………………………………………………………….26
3.3.c Criteria for the statistical analysis…………………………….27
4. Findings and discussion……………………………………………………………….28
4.1 Statistical analysis……………………………………………………………..28
4.1.a Demographics…………………………………………………………29
4.1.b Level of expertise……………………………………………………30
4.1.c Knowledge of IoT and data security………………………..33
4.1.d Project guidance…………………………………………………….34
4.2 Limitations of the research……………………………………………….36
4.3 Strategic value recommendations for software and
hardware
market……………………………………………………………………………………36
5. Conclusion………………………………………………………………………………….40
5.1 Research objectives and recommendations………………………40
5.2 Further research……………………………………………………………….42
6. Reflective report………………………………………………………………………..44
7. References…………………………………………………………………………………47
8. Appendix……………………………………………………………………………………51
6 Angelo Guida C1432680
1. Introduction
1.1 Background
Nowadays, user segmentation and engagement strategies are considered as
key concepts in marketing (Sollner and Rese, 2001). Indeed, they are considered as
core variables for successful marketing management strategies within any industrial
framework (Albert, 2003). According to Hooley et al. (2012) user segmentation or
market segmentation can be defined as “how marketers can divide the market into
groups of similar customers, where there are important differences between those
groups”. On the other hand, engagement strategies are aimed to “turn on” the
customer around a brand idea, by stimulating the level of cognitive, emotional and
behavioural involvement with a specific brand (Hollebeek, 2011). These two
concepts work at different levels of the marketing strategy, but at the same time, are
linked in order to ensure the satisfaction of customer’s needs, and consequently to
lead the organization to achieve a competitive advantage against competitors
(Hooley et al, 2012).
Initially, only large firms used these tools because small-medium enterprises
could not sustain the expenses that these marketing practices involve, and also their
human resources were not suitable to perform such strategies because of the lack of
knowledge due to poor qualifications. However, in the last decades these trends are
changing because thanks to the evolution of the Internet, even smaller organisation
can afford to use modern market segmentation and engagement strategies.
According to Kalinauskas and Skaržauskienė (2012), Internet enabled easier ways to
gather information, resources and communicate with the external world. In addition,
the level of education and knowledge within small-medium enterprises in the last
decades increased significantly because every year the number of graduates is
higher, and this brought an increase in the job demand which takes the graduates to
Angelo Guida C1432680 7
accept more frequently offers from smaller companies. In this way, small and
medium enterprises can segment their market and create engagement strategies
more easily without all the costs and difficulties that they had to face before, since
information and better quality of human resources are easier to obtain.
1.2 Research Focus
This piece of work will focus on how small-medium enterprises should find their
customer target, and how the target should be engaged in order to make the overall
marketing strategy and the awareness of the new products as profitable as possible.
In particular, the whole research will focus on how to market a segment and how to
engage it for a Californian producer of hardware and software solutions that will be
called “Z” for privacy reason, which is working in the sector of the “Internet of
things”. “Z” is a small enterprise founded in 2014 in California, which developed a
secure Internet of things motherboard that is integrated with Raspberry Pi, which
was established as non-profit organisation with a mandate to educate future
engineers, yet its products are also gaining early adhesion in commercial
applications, through “makers” and “IoT entrepreneurs”.
Due to this reason, this analysis will specifically focus on developing specific
user segmentation and customer engagement strategies to capture Raspberry Pi
users as they graduate from education into the work place, and to convert them into
long-term “Z” customers. Consequently, this focus will advance the following
research questions:
1. What is the most suitable segmentation approach for a start-up that is
entering in the hardware and software market?
2. Which targeting strategy is most suitable for a start-up in the hardware and
software market to follow: undifferentiated, differentiated or concentrated
strategy?
8 Angelo Guida C1432680
3. What are the possible strategic positioning approaches for a start-up coming
into the hardware and software market?
1.3 Overall Research aims and objectives
2. Identify, describe and quantify the major Raspberry Pi user segments, along a
development of the profiling characteristics of these user segments.
3. Individuate migration paths from Raspberry Pi students in education to
Raspberry Pi users in the workforce.
4. Develop a prioritized list of user segments
5. Recommend strategies for capturing or engaging target of Raspberry Pi users
as they enter in the workforce.
6. Identify, describe and quantify final segments for Raspberry Pi users.
1.4 Value of the research
The interest and motivation behind this research was increased by the
opportunity of applying directly methods and strategies learnt during the Cardiff
MBA and from previous work experience. In addition, according to Greenough
(2015) the Internet of things will grow exponentially by 2019, and there will be a
massive market available for it. Therefore, this research will give an important
contribution on how small-medium enterprises that are emerging with this new type
of technology – like “Z” – will segment their market and engage the final target in
order to be successful and make the business sustainable.
Angelo Guida C1432680 9
2. Literature Review
2.1 Introduction
In this literature review the focus will be placed on introducing the approaches
and issues of segmenting, targeting and engaging potential customers. Particularly,
and the principles proposed will be integrated and adapted with the approaches and
the issues related to start-ups which operate in the hardware and software industry.
Firstly, the concepts and principles about market segmentation will be analysed
and adapted to cases linked with start-ups that use Internet of things technology in
the hardware and software industry. Secondly, the theoretical principles and
strategies about targeting will be discussed in details, alongside the adaptation to
start-ups that use Internet of things technology. Finally, this chapter will evaluate the
issues about customer engagement, particularly related to possible brand
positioning strategies to adopt. Consequently, the analysis will link with the
evaluation of possible strategies that could be adopted by start-ups that compete in
the hardware and software industry.
2.2 Segmentation
2.2.a Segmentation concepts and principles
Market segmentation is a powerful marketing tool currently used by most
companies in order to identify the most attractive groups of commercial and private
customers to target (Simkin and Dibb, 2011). According to Hooley et al. (2012) to
achieve successful market segmentation, there are requirements that need to be
addressed, for example customers need to be different from one to another in some
aspects so the market can be divided. In addition, Hooley at al. (2012) argue that
10 Angelo Guida C1432680
segment targets need to have measurable characteristics in order to be identified,
and finally, the selected segments need to be isolated from the rest of the market so
it they can be targeted with different offers.
However, this is not an easy process to carry on because of the different issues
that can affect the market segmentation mechanism. According to Piercy and
Morgan (1993) the issues related to market segmentation are related to different
elements, such as the type of methodology used to segment the market – like
choices of the variables and choices of the target identification techniques to use –
the robustness of the target, the level of accuracy of strategic segmentation
decisions and, finally, the implementation of these strategies according to the
organisation’s capabilities. Yet, this vision regarding the issues linked with market
segmentation takes in consideration the problem only on the strategic and
operational level, which means only internal focus, as represented below by the
contextual segmentation matrix of Clarke and Freytag (2008):
Creating new offer Adjusting offer
Strategic level What market to be in? How to reconsider the
market?
Operational level How to address the
market?
How to strengthen
market position?
On the other hand, Kotler (2000) affirms that the issue of deciding which
segment taking in consideration depends on measurability, profitability, accessibility
and actionability of the selected segment. This vision enhances the fact that the
organisation should not only have an internal view of the problem, but it should
transfer it to the external environment in order to have a more clear vision about
issues and how to solve them.
Table 1. “Contextual segmentation matrix“ (Clarke and Freytag, 2008)
Angelo Guida C1432680 11
Nevertheless, the literature reviewed so far has an important missing element.
According to Dubois et al. (2003), to resolve the issues of segmentation and
implementing the choices of the new segments, marketers need to take in
consideration also the network of relations, both internal and external, of the
organisation itself. Therefore, by looking also at commercial partners alongside the
organisational culture, it is already a new type of approach, which can allow the
organisation to segment the market in a more complete way, in comparison with the
pervious methods described so far. In addition, organisations that engage in good
partnerships in this internationalised economy can have the opportunity of entering
in other countries with the same cluster of consumers targeted in the country of
origin (Sheng and Mullen, 2011). However, the possibility of finding other segments
at an international level in order to expand the possibilities of revenues is one of the
many benefits that segmentation can bring to a marketing strategy. Furthermore,
segmentation practices are beneficial to the organisation also because enables the
organisation to provide a product or a service that is closer to the target’s needs
(Jackson, 2007). In addition, the Internet age created other broader and
heterogeneous communities, which makes segmentation even more important tool
for companies in order to be competitive in the market (Barnes et al., 2007).
2.2.b Segmentation strategies for a start-up in the hardware and
software industry
As already mentioned in the introduction, in our current era small and medium
enterprises are now able to afford more easily to gather information and
communicate with the external world thanks to the advancement of Internet, which
reduced significantly transaction costs and decreased barriers (Kalinauskas and
Skaržauskienė, 2012). In addition, the level of knowledge and expertise in smallmedium
enterprises rose rapidly too because of the presence on the job market of
more graduates seeking for jobs in organisations. Therefore, many start-ups are
taking advantage of these conditions to develop their business.
12 Angelo Guida C1432680
The industry that surely is involved the most in this process is the hardware and
software industry, since these technologies are in continuous progress thanks to
their direct linkage with the Internet. The viability of the industry allows also the
creation of many start-ups with innovative ideas and interesting projects. However,
many of these new businesses tend to be oriented more on the sales opportunities
that this type of industry can offer, for example by reducing prices and offering many
promotions, with the hope of getting as many customers as possible, instead of
focusing on the customer requirements (Viardot, 2004). This orientation can be an
omen of failure, especially for a start-up, that’s why it is important to approach
carefully and rigorously to a process of market segmentation. In addition, the
literature about small-medium enterprises acknowledges that they cannot compete
neither with economies of scale, therefore they need to be smart and innovative in
their marketing strategy formulation (O’Dwyer et al., 2009). On the other hand,
Atherton and Lyon (2001) gave indications on how segmenting the small-medium
enterprise market suggesting that a firm should be looking at:
• Personal characteristics of the segment involved
• Attributes of the segment
• The activities and processes undertaken within and by the segment
• Specific needs of the segment
However, the model proposed by Atherton and Lyon (2001) represents only the
starting point for a start-up marketing strategy formulation (Blackburn, 2012).
Indeed, the strategy need more focus on the channels where the start-up will have
more chances of finding the desired segment, so the organisation can maximise its
efforts without wasting time and resources by looking at all the possible segments.
In relationship to the case of the hardware and software industry, the best channels
where to begin the market segmentation are surely blogs and social media.
According to Singh et al., (2008) blogs and social media assume a strong relevance
for start-ups because they are source of zero-cost information and also they help to
establish a relationships with customers. An organisation can easily get marketing
intelligence just by observing discussions on these channels, but also can have the
Angelo Guida C1432680 13
opportunity of establishing on-going dialogue between the customer and the
marketer. In addition, keeping a good relationship with the segments will be useful
also for shaping the products due to their requirements and emphasizing regular
technical innovations (Alajoutsijarvi et al., 2000).
2.3 Targeting
2.3.a Targeting concepts and principles
Following the decision of the market segments to attract, an organisation needs
to take a decision in order to identify which segments might be more profitable for
the future revenues of the firm. This strategic step is called targeting, and it is
defined as a strategic marketing tool where marketers need to decide which
segments to prioritise in order to maximise the sales and marketing efforts (Dibb et
al., 2012). However, the approach required to make an effective market targeting is
found in between an accurate marketing research and an effective marketing
management decision-making (Hamlin, 2000). Therefore, it is important to structure
well the marketing research by choosing accurately relevant factors to look for, like
for example needs of end users, size of the segment and how the brand is perceived
by the cluster of people chosen for the market research in order to understand if
that market segment is attractive or not (Dibb et al., 2012). Yet, these external
factors mentioned by Dibb et al. (2012), need to be combined with internal elements
such as company’s strengths, resources and capabilities (Hooley et al., 2012). Thus,
with an effective combination of internal and external factors, an organisation can
understand if it is beneficial to approach a target of customers or not. This concept
brings managers to consider a multitude of variables in the decision making process,
rather than using only financial indicators, which will lead them to a broader
consideration of the market attractiveness in order to take decision not only for the
short-term, but especially for the long-term (Simkin and Dibb, 2011). In addition,
considering the advantage of living in an era where most of the firms are digitalised,
the usage of databases with information gathered and recorded thanks to
14 Angelo Guida C1432680
information communication technology (ICT) and to the information retrieval
systems (IRS), give the possibility of having even more available information for
making more accurate decisions (Fourie and Fourie, 2014).
The next step is associated to the choice of which approach to targeting
strategies to use in order to maximise the possibility of capturing the selected target.
The classic approaches to targeting strategies are mentioned by Kotler and Keller
(2008), whom suggest to consider three broad strategies to follow:
• Undifferentiated strategy, that relates to the production of one single
product aimed to all the segments.
• Differentiated strategy, where different products are offered to each of the
different segments.
• Concentrated strategy, where the organisation focuses on one or a few
segments.
The advantage of using Kotler and Keller (2008) approaches is placed in the flexibility
that these strategies can bring. For example, undifferentiated strategy will be more
likely to be suited to a mass-marketing strategy where the firm needs to influence
more people at one time (Kotler and Lee, 2012). On the other hand, a differentiated
strategy will be more suitable for a strategy that wants to approach more segments,
therefore the organisation needs to develop a specific marketing mix for each
chosen segment (Dibb et al., 2012).
However, the main suggestion that the author of this piece of paper can give
is that an organisation should not rely blindly on these methods for finding a
particular target and stick with it, but managers should keep a mentality of flexibility
in their targeting strategies, because the market can change rapidly. Indeed, with the
new customer’s generations that are emerging, especially on the web and social
media, the possibility of having new types of targets will increase drastically.
Therefore, an organisation should keep always an eye on the dynamic and the
Angelo Guida C1432680 15
changes within the selected targets, in order to adapt and modify the targeting
strategy once the selected target starts to show signs of change.
2.3.b Targeting strategies for a start-up in the hardware and software
industry
Having marketing capabilities is crucial for the survival of a start-up in the
hardware and software industry (Li et al., 2010). Developing strong marketing
capabilities is very important in this type of industry especially because the
technological and complexity level of the products is considerably high (Moen et al.,
2003), therefore marketers need to develop targeting tools that will allow the
organisation to spot the precise and relevant characteristics of the targets. In
support of this concept, the choice of targeting the software and targeting market,
especially in the UK, is a good choice for a start-up. Indeed, as reported by
Marketline (2015), the UK software market accounts for the 18.6% of the European
software market value, second only to Germany with 24.4%.
Geography 2014 ($ billion) %
Germany 25.4 24.4
United Kingdom 19.3 18.6
France 14.1 13.6
Italy 6.0 5.8
Spain 4.5 4.3
Rest of Europe 34.7 33.4
Total 104 100
Table 2. “United Kingdom software market geography segmentation” (Marketline,
2015).
16 Angelo Guida C1432680
Also, thanks to the data provided by Marketline (2015), the software market
value increased by 2% in 2014 and has a value of $19.3 billion, as it shows by the
table below:
Year $ billion £ billion € billion % Growth
2010 15.8 9.6 11.9
2011 16.3 9.9 12.3 3.5
2012 17.4 10.6 13.1 6.3
2013 19.0 11.5 14.3 9.1
2014 19.3 11.7 14.6 2.0
0
20
40
60
80
100
120
Germany United
Kingdom
France Italy Spain Rest of
Europe
Total
2014 $billion
%
Figure 1.“United Kingdom software market geography segmentation” (Marketline,
2015).
Table 3. “United Kingdom software market value: $ billion, 2010-14”. (Marketline,
2015)
Angelo Guida C1432680 17
In addition, the market industry profile researcher forecasts an in increase in the
software market of 39.9% from 2014 to 2019 and an overall market value of $27
billion, as it is represented in the table below:
Year $ billion £ billion € billion % Growth
2014 19.3 11.7 14.6 2.0
2015 21.0 12.8 15.9 8.8
2016 22.4 13.6 16.0 6.4
2017 23.9 14.5 18.0 6.5
2018 25.4 15.4 19.1 6.3
2019 27.0 16.4 20.3 6.3
0
5
10
15
20
25
30
2010 2011 2012 2013
2014
% Growth
$ Billion
Figure 2. “United Kingdom software market value: $ billion, 2010-14”. (Marketline,
2015)
Table 4. “United Kingdom software market value forecast: $ billion, 2014-19“
(Marketline, 2015).
18 Angelo Guida C1432680
Therefore these data show that the industry can be profitable also in the long
term for a small-medium enterprise, that’s why the focus should be placed in
creating a strategy that will allow identifying the right market target, without
wasting many resources. On the other hand, the software industry tends to move
really quickly in terms of technological development, brief product life cycle and
obsolescence of products, making the market extremely competitive (Ruokolainen
and Makela, 2007).
From the previous concepts, it emerges that probably the best targeting strategy
for a start-up in this industry is related to selectivity (Cantner and Kösters, 2011).
According to the study conducted by Cantner and Kösters (2011), start-ups cannot
afford to waste many resources by targeting and creating different offers for every
target that is taken in consideration. Indeed, internal polices should state that the
most efficient and effective way of picking the target is to select the cluster of
customers that will be more profitable for the future of the organisation. This is a
crucial concept because new organisations cannot afford to waste time and
resources otherwise they will rapidly exit from the market and fail. Therefore, in
0
5
10
15
20
25
30
2014 2015 2016 2017 2018 2019
$ billion
% Growth
Figure 3. “ United Kingdom software market value forecast: $ billion, 2014-19“
(Marketline, 2015).
Angelo Guida C1432680 19
targeting users is suggested from the study of Parry et al. (2012), that the most
advantageous market to target is often a niche market, since that the competition is
limited and the cluster of customers is very specific. However, Parry et al. (2012) also
suggest that creating an own market – thanks to the technology developed – can
bring the same advantages of picking a niche market. This approach is shared also
by Walsh and Lipinski (2009), that consider these two strategies as a source of
creation for competitive advantage. According to Singh et al., (2008), once again
corporate blogs and social media are very useful tools also for targeting, because
customers in some cases are already segmented and there are specifications of their
preferences about the products. This approach will bring different advantages to the
strategy because it will be a source of large information with very low cost and waste
of resources.
2.4 Positioning and customer engagement
2.4.a Positioning and customer engagement concepts and principles
Achieving a good market segmentation strategy and select the right customer
target are requirements that are necessary for a good marketing strategy, but they
are not sufficient. Indeed, in order to generate a complete strategy a company needs
to formulate a plan for engaging customers and positioning the brand in their mindset.
The literature about customer engagement focus mainly on investigating on how
the customer can feel emotionally engaged with the brand and the community
around it, factors causing the engagement and how it impacts on their behaviour
(Algesheimer et al., 2005). On the other hand, other studies focused mainly on the
concept of customer engagement as a manifestation of the customer’s behaviour as
a consequence of interactions (Bolton, 2011). Yet, it is argued that the manifestation
of behaviour is just a consequence of the influence of several factors, such as,
cognitive, affective, behavioral and attitudinal, which influences the customer
involvement with a brand (Vivek et al., 2012). However, the vision of Bolton (2011) is
closer to the reality of our age, because especially with the advent of social media,
20 Angelo Guida C1432680
customers interact continuously with the firm and among themselves (Libai, 2011).
Therefore, the idea of customer engagement should focus on the relationships that
are created thanks to the interactions between the firm and the customer, and also,
thanks to the interaction between customers (Gummerus, 2012).
However, the creation of relationships with customers needs to be supported by
an effective brand positioning strategy. According to Dibb et al. (2012), brand
positioning is about the image or perception that is created of the brand in the
customer’s target mind-set. Therefore, brand positioning assumes the role of
important tool for strategic decision-making (Keller and Lehmann, 2006). Yet, an
effective brand positioning highly depends from the firm’s key capabilities and how
the organization is able to formulate different positioning strategies, in order to suit
the customer’s segments preferences (Fuchs and Diamantopoulos, 2010). However,
the process of communicating effectively to customers the offer of products or
services that an organization wants to provide them is very delicate. Indeed, Fuchs
and Diamantopoulos (2010) make a clear distinction between the intended brand
positioning that a firm wants to give and the actual brand positioning that the
customers perceive. In this case, the concept of engagement and interaction with
customers assume a relevant importance because the communication of the firm’s
intentions need to match the customer’s perception, since that every moves of the
firm become an input to the image of the brand (Davis et al., 2008). However, the
author of this review believes neither approach to be completely effective. Indeed, a
‘synthesis’ of both could be more beneficial. This is because in this way, the firm
could focus on internal factors by using the key’s capabilities to provide a satisfying
product or service. But it would also center on external factors by matching both
perceptions about the brand at the same time. To conclude, it seems that an
organization would greatly benefit from both pleasing and actively engaging their
customers.
Angelo Guida C1432680 21
2.4.b Positioning and customer engagement strategies for a start-up in
the hardware and software industry
The research done so far on entrepreneurial small and medium enterprises is
recognised as an important generator of economic growth (Henderson and Weiler,
2010). Therefore, the question of formulating a good positioning strategy for small
and medium enterprises is a central topic; especially since the hardware and
software industry is a very dynamic environment (Murray et al., 2002). Despite the
fact that there is not much literature about how small and medium enterprises
should market themselves in this type of industry (Jones and Rowley, 2009), the
interest in how start-ups create their marketing strategy in such highly competitive
environment is increasing (Borg, 2009). The general interest is placed in the fact that
being small and medium enterprises can be extremely advantageous because of the
rapidity of answering the market needs, the ability of satisfying rapidly customer
needs and the opportunity of having closer relationships with customers (Simpson et
al., 2006). On the other hand, it is not a simple task to market their products,
because they are known for being characterised by a high degree of complexity and
intangibility, which make their benefits hard to be communicated to customers
(Moen at al., 2003).
Having considered the previous concepts, a small-medium enterprise should
focus its positioning strategy on how delivering value to the customers through
support and service (Ruokonen and Saarenketo, 2009). Indeed, according to the
study of Parry et al. (2011), a firm should position itself by creating two important
perceptions in the customer’s mind: effective interaction with the customer for
tailoring the firm’s offer in relationship to their needs and seek dialogue with
customers in order to meet their always changing expectations. However, Ojasalo et
al. (2008), suggest that creating partnerships or cooperate with bigger market
players can be a factor of strength for a good positioning strategy and for customer
engagement. This idea has also an important advantage in terms of cost reduction,
22 Angelo Guida C1432680
because partner firms can share costs related to resources and capabilities (Jones
and Rowley, 2009).
3. Methodology
Following the concepts and principles analysed in the literature review about
segmentation, targeting and positioning strategies for start-ups in the hardware and
software market, a several amount of questions have arisen up. The adoption of
different philosophical and strategic approaches to the research question will be
displayed in the upcoming section. The coming research tries to critically analyse and
provide applicable solutions for the following aim:
“To investigate the best way for start-ups to find their customer target, and how the
target should be engaged in order to make the overall marketing strategy sufficiently
viable for entering and penetrating a market ”.
3.1 Research philosophy and ethics
This research project is based on the theoretical position of the
epistemology, which is defined as the process of managing the nature and the
sources of our knowledge (Cocchiarella, 1991). There are two perspectives linked
with the concept of epistemology, which are positivism and interpretivism. A
positivist approach is defined as the process of shaping theoretical concepts in logic
and mathematic proposition by satisfying the requirements of falsifiability, logical
consistency, explanatory power and survival (Lee, 1991). However, by using this
approach there is the risk that the methodology can be lead towards manipulation
or generalisation of the data (Guba and Lincoln, 1994). On the other hand, the
interpretative approach can give more guarantees because the reality is seen as
multiple and relative, therefore the social world should think about understanding
and interpreting the point of view of different subjects (Hudson and Ozanne, 1988).
As consequence of this discussion, this research project will follow the perspective of
Angelo Guida C1432680 23
interpretivism, since it is more suitable to understand the different visions about
how consumers think about a certain product, in order to find the right consumer
target.
Following the previous discussion about epistemology, in this part the focus
will be placed on deciding which type of research approach is more suitable between
a deductive approach and an inductive approach. However, the lack of literature
about segmentation, targeting and positioning for small-medium enterprises in the
UK software market can be an important limitation in this decision. Considered this
important constraint, for this research an inductive approach would be more
beneficial. Indeed, deductive approaches are more suitable for studies where the
aim is to test an existing theory (Gabriel, 2013), but in the case of this research
project, the aim is placed on generating a new theory from new gathered data. In
addition, an inductive approach is also beneficial for having a deeper understanding
of attitudes, perception and behaviour of the participants (Bryman and Bell, 2011).
The subject matter of this research is not considered unethical; therefore no
risks for the participant were involved. The study was approved by an university
ethical committee and a project supervisor through the acceptance of an ethics form
(see Appendix I). All the responses were treated as confidential and no attribution
was made to any individual since the questionnaire is completely anonymous.
Furthermore, all the purposes of the questionnaire were outlined in the survey
introduction, in order to make participants well aware about the content of the
questionnaire. Any question could be skipped if the participants would not want to
answer it and the participation to the survey could have been withdrawn anytime
during the answering process.
24 Angelo Guida C1432680
3.2 Research strategy and sample types
3.2.a Questionnaire related strategy
Subsequently to the discussion, about which approach is more suitable for
this type of research project, in this paragraph the focus will be located on the
strategy and the methodology that will be used for the data gathering. The
designated strategy adopts a combination of quantitative and qualitative research
methods in order to address effectively the research questions. The choice of mixing
both qualitative and quantitative methods is related to the fact that this combination
will provide a more pragmatic and business-like view to a software small-medium
enterprise and its customers (Teddlie and Tashakkori, 2009). In addition, according
to Silverman (2010), a combined method approach will entail a wide range of
exploratory questions that will add a vigorous interpretation or triangulation of the
data. Furthermore, it will give the opportunity of looking at a higher number of
different points of views (Teddlie and Tashakkori, 2009).
Hence, the need of investigating among a cluster of different perspectives
meant that the most efficient way of understanding articulated customer’s trends
and expectations would be to use a mixed approach between these two research
methods (Parry et al., 2011). The usage of a combined approach has been already
used to analyze the marketing practices of small-medium enterprises (Bradshaw et
al., 2008), with relative good success if we look at the width that these researches
accomplished (Parry et al., 2011). However, the adoption of a combined approach of
these methods in marketing researches is still limited (Hanson and Grimmer, 2007).
The research was conducted through the adoption of an online consumer
survey, which will combine both of the already mentioned research methods in
order to provide an accurate picture about customer trends in the hardware and
software market. The reason behind the use of an online survey will bring a
variegated number of information with the minimisation of the research costs, and
Angelo Guida C1432680 25
the answers will be obtained in a relative short period, in comparison with interviews
and focus groups which are time consuming and information limited (Spijkerman et
al., 2009). For this reason, the author of the survey opted to use for the “Survey
Monkey” platform for building the survey, which is easy and fast to use, both for the
questionnaire maker and for the participant. Furthermore, the decision of using an
online survey was also inspired from previous similar studies, which gathered
answers coming from communities’ social media with a questionnaire. An example
of this is the study of Gummerus et al. (2012), who were looking at gaming
communities on Facebook, and posted the online questionnaire on relevant social
media’s online pages in order to find the appropriate customer target.
The questionnaire was divided in four sub-sections, each targeting a
particular profile of the person surveyed. The first section was just based on
demographics centered questions. This was done so because in this way, the analysis
could divide the participants into several clusters (age, gender, etc.) for comparative
purposes. The second section rather focused on the expertise level of the
participants. This was to separate experts from non-professionals samples. The third
section of the questionnaire was aiming at discovering their level of knowledge
concerning the ‘Internet of Things’ and their concerns of the security of the data for
market purposes. Finally, the last section was about the use – purpose, place they
seek guidance for projects, etc – they would make of the Raspberry Pi motherboard.
This is to find out how professionals would be likely to use the project.
3.2.b Sampling
Consequently, for assuring a prosperous data gathering from the survey, the
questionnaire was tested firstly by a group of restricted peers in order to ensure the
comprehensibility of the questions and the validity of the survey. According to
Beynon-Davies (2013), the main contributors for an online survey are social network
media. Following this advice, the questionnaire was posted on Facebook, Linkedin,
Twitter and targeted blogs. In order to find an answer to the three research
26 Angelo Guida C1432680
questions mentioned in the introduction of this research project, an online survey
divided into twenty questions was used. The main objective of the questionnaire was
to obtain the highest possible number of relevant answers about the frequency of
usage and the level of expertise of the participants.
Specifically, the researchers were looking for people who were working on
projects that entail the usage of the Internet of things by using the Raspberry Pi or
other computer boards. This specification is fundamental for the relevance of the
research, and for this reason the online survey was posted only on relevant websites,
such as the official Facebook page of Raspberry Pi, the official Twitter webpage of
Raspberry Pi, Raspberry Pi official forum and Raspberry Pi Google+ community blog.
The overall number of participant to the online survey was of 210 – the exact
demographics clusters will be discussed in the findings – but it is noteworthy to say
that only 181 of them completed the survey entirely. Nevertheless, all participants
were included in the analysis.
3.3.c Criteria for the statistical analysis
Demographics such as age, occupation and gender were recorded for each
participant – when an answer was provided. The statistical analysis that followed
was divided in subsequent age, occupation and gender clusters. The age subgroups
were five in total: under 16, between 16 and 24, between 25 and 40, between 41
and 65 and 65 and above. This was in order to figure out the age range that was the
most likely to consume the product. Similarly, it was found that about 86% of the
participants were males, 12% were females and 2% preferred not to disclose it. The
data concerning the gender differences was deemed irrelevant though. This is firstly
because the occupation and age cluster were judged more important than the
gender variances. Secondly, since at least 2% of the participants did not wish to
answer this question, this could have potentially led to some statistical bias. Finally,
questions concerning their occupation were used to divide the participants in a third
set of six clusters: GCSE, A-Level, Diplomat, Undergraduate, Postgraduate and PhD.
Angelo Guida C1432680 27
This was done in order to determine was kind of occupational background the
potential customers were more likely to have.
4. Findings and discussion
The coming chapter will introduce the findings from the primary research
methodology of the hardware and software market in the UK. A precise relationship
will be established with the previous research questions, outlined in the previous
chapters. In the first paragraph of the chapter, the focus will be placed on the
elaboration of the statistical analysis taken from the quantitative and qualitative
data collected thanks to the online survey. Following this analysis, the second
paragraph will look to analyse the limitations of this research project and further
study opportunities in this field. The final section of this chapter will focus on
evaluating and discussing suitable value proposition and viable recommendations for
a start-up, which wants to enter in the UK’s software and hardware market. Surely,
the recommendations and the limitations of this study will represent the most
important part of this research project.
4.1 Statistical Analysis
In order to find an answer to the three research questions mentioned in the
introduction of this research project, an online survey – divided into twenty
questions – was used. As mentioned in the methodology’s chapter, the total number
of participant to the online survey was of 210. The following paragraph will be subdivided
in four sub-sections – as in the questionnaire – which will be named
respectively: demographics, level of expertise, knowledge of IoT and data security
and project guidance section.
28 Angelo Guida C1432680
4.1.a Demographics
In this first part of the survey the researches asked four demographics’
questions to the participants. It emerged that the biggest part of Raspberry Pi users
are ageing between 25 and 40 years old (38.64%) and between 41 and 60 years old
(31.25%). In addition, the second question about the gender showed that most part
of the participant were males (86.12%), and the third one about their education level
displayed that the biggest percentage of the participants were educated until the
postgraduate level (35.1%) and undergraduate level (25.96%).
Yet, the most significant information coming from this first section was
represented by the question four (from now on Q4), which was related to the
occupation status of the participant, which showed that the main part of them is
currently employed full-time in the technology industry (43.75%). This information
will be particularly useful for the positioning approaches that will be discussed in the
upcoming paragraph of this research project. However, it is interesting to notice that
0 10 20 30 40
GCSE (or equivalent)
A-level (or equivalent)
Diploma (or equivalent)
Undergraduate (or equivalent)
Postgraduate (or equivalent)
PhD (or equivalent)
% Response rate
Q3. What’s your highest level of educaon? Answered:
208
Figure 4. “Findings of Q3 within the Consumer Survey”
Angelo Guida C1432680 29
in the Q4 the student population also was representing the second option with
27.4% of participants who selected it.
4.1.b Level of expertise
The second section of the online survey was aimed to discover the level of
expertise of the participants, in order to determine if the sample was relevant for
the research project. Participants were asked to answer nine questions from this
section. Firstly, researchers asked if the sample was in possess of a single board
computer and to specify which single board computer they were using with an open
answer. It appears that 85.64% of participants posses at least one single board
computer. In the open answer about which single board computer participants were
using, the biggest part of them wrote Raspberry Pi 2, followed by few answers about
Arduino.
0
5
10
15
20
25
30
35
40
45
Q4 What best describes your occupaaon?
% Rate of responses
Answered:
208
Figure 5. “Findings of Q4 within the Consumer Survey”
30 Angelo Guida C1432680
In Q6, participants were asked if they were using multiple boards computers,
and 63.89% of them answered, “Yes”, which proofs that the sample is starting to
show higher level of expertise in the field, which it was the principle aim of this
online survey. However, some interesting information emerged from Q7, because it
was asked if the participants were belonging to any specific “maker” community. The
results showed that the majority of them did not belong to any of them with 86.03%
of “No” answers, which suggests that the sample prefers to work alone and it is not
interested in sharing opinions about the posses of single/multiple board computers.
In Q8, researchers asked the participant their level of expertise with software and
hardware technology measured by a Likert scale going from “1” (amateur) to “10”
(professional), and it appears that the sample is more knowledgeable in the software
field with a weighted average of 6.58, against the weighted average of the hardware
field 4.82. However, in order to be coherent with the aim of this research,
researchers will take in consideration the percentage of who selected the value “10”
on the scale. It seems that participants have a higher level of expertise on software
(20.83%), rather than with hardware (4.29%). Another Likert scale was used in Q9, to
determine the frequency of usage of the computer boards, where the value “1” was
associated with “occasional hobby” and the value “10” was associated with daily use.
0 20 40 60 80 100
Yes
No
Q5 Do you own a single board computer?
% Rate of responses
Answered: 181
Figure 6. “Findings of Q5 within the Consumer Survey”
Angelo Guida C1432680 31
Like for Q8, in Q9 researchers will take in consideration the percentage of answers
about the daily usage, which were the most selected by the sample with 23.89% of
participants who said to use the board computer daily. With Q10, researchers aimed
to discover in depth the level of expertise of the participants, by asking them the
level of complexity of the projects undertaken with the single/multiple boards
computers. Interestingly, the 58.52% of participants stated that they were using the
board computers for “hobby projects”, however the other 27.84% answered to use
them for “both hobby and professional projects”.
In order to discover in depth for what these projects were made for, in Q11
researchers asked with an open question to specify the projects’ business area.
Participants stated that the major parts of these projects were used for: video
streaming, robotics, gaming and weather station. The final question of this section
was Q12, which was aimed to detect if the participants were working alone or with
other people to these projects, and it resulted that 84.97% of participants prefers to
work alone on projects.
0
10
20
30
40
50
60
Hobby
projects
Professional
projects
Both Hobby
and
Professional
projects
Personal
business
ideas
Q10 How would you describe your project?
Rate of responses
Answered:
176
Figure 7. “Findings of Q10 within the Consumer Survey“
32 Angelo Guida C1432680
4.1.c Knowledge of IoT and data security
The third section of the questionnaire is aimed to discover the level of
knowledge of the “Internet of Things” of the participants and if their buying
behaviour is influenced by concerns about their data security. As mentioned in the
methodology, the reason behind the choice of these questions is related to the fact
that this research is aimed to understand how to find long-term customers for the
Californian start-up mentioned in the introduction, since that data security is their
main selling point.
In order to address the mentioned aim, firstly, researchers asked in Q13 if
participants knew what was “Internet of Things” is, and 86.78% of answers were
“Yes”. However, Q14 showed interesting information, because in this question
participants were asked if – despite their knowledge of “Internet of Things” – they
have ever attempted a project with this technology. Most of the participants replied
that they never attempted such type of projects (71.26%), but participants who
answered “Yes” (28.74%) were asked to specify how many they attempted so far.
The majority of people stated that they have attempted so far between one and five
projects, which suggests that these type of project are not yet popular in
professional environments.
0 20 40 60 80
Yes
No
Q14 Have you adempted IoT projects?
% Rate of responses
Answered:
176
Figure 8. “Findings of Q14 within the Consumer Survey“
Angelo Guida C1432680 33
This information is demonstrated in Q15, which asked if participants were
using the “Internet of Things” in their everyday life. Coherently with the previous
question, the majority of participants answered “No” to this question with 78.03%.
On the other hand, in Q16 researchers asked if participants were concerned about
the security of their data, and the majority of them answered, “Yes” with 69.54%.
However, with Q17 researchers asked explicitly to what extent data security was
playing an important in the purchasing behaviour of the participants. Researchers
used an Likert scale going from “1” (no impact), to “10” (high impact), and the results
were reassuring for the research study because in average data security had a
moderate impact on customer buying behaviour with a weighted average answer of
6.24. However, the biggest part of answers were placed on the value “8” with
13.22% of answers, and the value “10” with 15.52% of preferences, which suggest to
the researchers that data security has an important impact on the customer
purchasing behaviour in this type of industry.
4.1.d Project guidance
The last section of the online survey is aimed to discover where people are
seeking guidance for projects and which social media they are using the most, in
order to identify viable promotional channels for the start-up subject of this study.
Firstly, researchers asked in Q18 what form of social media participants were using
the most, and the two most popular choices among participant were for “Social
networking” – like Facebook and MySpace – with 31.25% and “Micro-blogging sites”
– like Twitter – with 41.88%. The following question, Q19, asked clearly to
participant where they would seek guidance for projects, and interestingly, the
answers in this section were variegated. Participants could choose among eleven
alternatives and they could also apply multiple choices where they preferred. From
this question emerged that most of the survey’s participants are seeking guidance
for projects on “Code repositories” – like GitHub, BitBucket and Gnu – with 60.48%,
34 Angelo Guida C1432680
followed by “Company sponsored websites/blogs/forums” – like raspberrypi.org,
apple.com or Raspberry Pi forum – with 57.49% of preferences; finally, the third
most popular answer was “Maker sites” – like Hackaday and Instructables – with
50.3% of votes.
It is interesting to notice that 84 participants – out of 167 that answered this
last question – prefer to seek guidance for their projects on “Maker sites”, but as
showed in Q7, people do not prefer to belong to these communities since those 154
participants – out of 179 who answered Q7 – answered that they do not belong to
these communities.
0 10 20 30 40 50 60 70
Code Repositories
Maker Sites
Social Networking Sites
Creasvity Sharing Sites
Business Networking Sites
Social Bookmarking Sites
Micro-Blogging Sites
User-Sponsored Blog/Forum
Company Sponsored Websites/Blogs/
Educasonal Material Sharing
Opensource Sotware Community
Q19 Where would you seek guidance for a project?
Rate of responses
Answered:
167
Figure 9. “Findings of Q19 within the Consumer Survey“
Angelo Guida C1432680 35
4.2 Limitations for the research
The second paragraph of this chapter will look at the limitations and the
weaknesses that influenced the results of this research project, in order to discover
possible future improvements. The first limitation is linked to the little amount of
literature around the topic of segmentation, targeting and positioning for smallmedium
enterprises, as previously mentioned also by Jones and Rowley (2009). This
implied the usage of theories and references from authors who made studies and
recommendations for big enterprises, which are not very applicable in the case of
this research. Therefore, more qualified researchers should be more encouraged by
universities or by other firms in increasing the number of studies about how startups
should start to market themselves at the beginning of their business. The second
limitation is related to the time constrains imposed by the university for handling the
project. Indeed, such a deep study requires at least one year of interviews and
observations on the field, in order to determine if the data acquired can allow
precise and accurate recommendations for a start-up. In addition, it would allow also
seeing in first person how these suggestions impact on the firm itself. Furthermore,
the research was conducted only for two months with the help of only one online
survey, which acquired only 210 answers, therefore the quality and the quantity of
the information acquired is not enough to produce enough accurate
recommendations as they should be.
4.3 Strategic value recommendations for software and
hardware market
Following the statistical analysis about the emerging data from the online
survey, and the limitations discussed in the previous section, this paragraph will
place its focus on answering the three research questions with viable
36 Angelo Guida C1432680
recommendations for a sustainable segmentation, targeting and positioning strategy
for a start-up entering in the software and hardware market in UK.
Firstly, based on the answers of our online survey we will aim to answer the
first research question, which is “What is the most suitable segmentation approach
for a start-up that is entering in the hardware and software market?”. The answer to
this question can be related to the vision of Atherton and Lyon (2001), who affirm
that a good segmentation strategy should be looking at personal characteristics of
the segment involved, attributes of the segment, the activities and processes
undertaken within and by the segment and specific needs of the segments.
Therefore, this means that a start-up in the technology industry should focus mainly
on the type and preferences of customers, rather than focusing on improving
strategic and operational strategy like affirmed by Clarke and Freytag (2008). Indeed,
as showed by the results of the survey, looking at external environmental factors
influencing this type of market such as, knowing if people own at least one single
board computer, frequency of usage of this device and level of concerns about the
data security; a start-up can know if the segment can be useful or not for their
purposes, without wasting many economics and physical efforts. In addition, using
blogs and social media for gathering this type of information as mentioned
previously by Singh et al. (2008), it should be a key part of the segmentation strategy
of a start-up, since that the largest part of the answers and contribution to the
research came exactly from these platforms, and at the same time, the information
acquired were relevant and cost-effective.
Following the answer to the first research question, now the focus will be
placed on answering the second one, which is “Which targeting strategy is most
suitable for a start-up in the hardware and software market to follow:
undifferentiated, differentiated or concentrated strategy?”. As previously mentioned
in the literature review by Kotler and Keller (2008), undifferentiated strategy is
related to the production of one single product aimed to all the segments and
differentiated strategy is related to different products offered to each of the
different segments in the market. However, these two strategies cannot be viable
Angelo Guida C1432680 37
because they require great mass-marketing efforts (Kotler and Lee, 2012) and the
development of a specific market mix for each segment (Dibb et al., 2012). Especially
for a start-up at the beginning of its business, these two types of strategies cannot
sustain polices because it will waste a great amount of time and resources.
Consequently to this analysis, a start-up should start with a concentrated targeting
strategy, and with the development of the business should think to adopt one of the
mentioned strategies. This choice is related not only to the fact that by focusing only
on few but relevant segments the offer of the business can be built more efficiently,
but also as it is shown in the questionnaire the target of people is narrowed to few
segments such as, people educated to a degree level – “undergraduate” and
“postgraduate” with 61.06% – and people still in education and “employed full-time
in the technology industry” with a sum of 71.15%.
Finally, the discussion will focus on answering the third research question:
“What are the possible strategic positioning approaches for a start-up coming into
the hardware and software market?”. From the previous literature review, it was
argued that customers’ engagement is a consequence of interactions (Bolton, 2011),
0 10 20 30 40 50 60 70
GCSE (or equivalent)
A-level (or equivalent)
Diploma (or equivalent)
Undergraduate and Postgraduate
(or equivalent)
PhD (or equivalent)
Q3 What’s your highest level of educaon?
(modified)
Rate of responses
Figure 10. “Findings of Q3 within the Consumer Survey, adapted to
recommendations“
38 Angelo Guida C1432680
and thanks to social media customers interact continuously with themselves and
with the firm (Libai, 2011). Furthermore, from the online survey emerged that the
target users use mostly social media to seek interactions – “social networking” such
as Facebook was chosen by 31.25% of participants and “micro-blogging sites” such
as Twitter was chosen by 41.88% of participants.
Therefore, a start-up should focus on positioning and engaging customers
through these communication channels. Especially, because it will be firstly costeffective
since that communication and publication of content on these channels
have a relatively low cost. Also, through communication on blogs and social media
there is a higher chance of reaching the preferred target, in such a way to match the
intended brand positioning and the actual brand positioning discussed previously by
Fuchs and Diamantopoulos (2010).
0 10 20 30 40 50
Social Networking
Creasvity Sharing Sites
Business Networking Sites
Social Bookmarking Sites
Micro-Blogging Sites
N/A
Q18 What form of social media do you use the
most?
% Rate of responses
Answered:
160
Figure 11. “Findings of Q18 within the Consumer Survey“
Angelo Guida C1432680 39
5. Conclusion
The final chapter of this research project will look to summarise and finalise
the main points of this study. Firstly, the findings generated by the primary research
will be examined and they will be addressed to the three research questions in order
to provide a logical conclusion to this research project. It is important to remember
that these findings are the product of a research, which was influenced by time and
resource constrains. Therefore, in the final paragraph of this study, the author will
provide further research opportunities in order to give the opportunity to further
researchers to produce more accurate studies on the matter of segmentation,
targeting and positioning strategies for a start-up entering in the hardware and
software market in the UK.
5.1 Research objectives and recommendations
Following this brief introduction to the chapter, this section will aim to
address the overall aim of this research project by outlining viable answers to the
three research questions, previously proposed from the gap in the literature review,
shown in the table in the following page:
Research questions
1) What is the most suitable segmentation approach for a start-up that is
entering in the hardware and software market?
2) Which targeting strategy is most suitable for a start-up in the hardware and
software market to follow: undifferentiated, differentiated or concentrated
strategy?
3) What are the possible strategic positioning approaches for a start-up coming
into the hardware and software market?
Table 5. “Research questions originated from literature’s gap”
40 Angelo Guida C1432680
The answers to these questions were generated thanks to the contribution of the
qualitative and quantitative methods applied to the online survey. With regards, to
the first question, it was argued – in the literature review – that there are different
approaches for building an appropriate market segmentation strategy. Firstly, it was
discussed that a good marketing segmentation strategy should be internally focused
(Piercy and Morgan, 1993), and it should focus on planning on the strategic and
operational level (Clarke and Freytag, 2008). On the other hand, Atherton and Lyon
(2001) suggest to look at personal characteristics, attributes of the segment, the
activities and processes undertaken within and by the segment and specific needs of
the segments. Furthermore, Singh et al. (2008) argued that the best way for a startup
to gather Intel is to use relevant social media and blogs. The answer to the first
research question meet the affirmation of Atherton and Lyon (2001) and Singh et
al. (2008), because by posting the online survey on relevant social media and blogs it
was possible to gather 210 answers for the survey without any economic effort, and
also it was possible to determine if the segments was relevant or not by focusing the
survey’s questions on specific needs, personal characteristics and specific attributes
of the segment, as suggested by Atherton and Lyon (2001).
The second research question was answered by analysing the three different
targeting approaches proposed by Kotler and Keller (2008), which are
undifferentiated, differentiated and concentrated approach. Due to lack of both
economic and physical resources a start-up entering in a new market cannot sustain
undifferentiated and differentiated targeting strategy (Kotler and Lee, 2012; Dibb et
al., 2012). In addition, the results coming from the survey suggest that the target is
particularly narrow, since people with a high education level (both undergraduate
and postgraduate) represent the 61.06% of the participants and employed full-time
and still in education represented the 71.15% of the answers. Therefore, due to
these reasons the most appropriate targeting strategy for a start-up seems to be a
concentrated strategy.
Finally, the third and last research question was addressed by analysing, which
are the factors that contribute the most for customer engagement and brand
Angelo Guida C1432680 41
positioning in our current era. Bolton (2011) argued that customer engagement is a
consequence of people’s interactions, and Libai (2011) affirmed that social media are
the ideal place to develop interactions between firm and customers and between
customers. In addition, Fuchs and Diamantopoulos (2010) declared that the biggest
problem for a start-up is to match intended brand positioning with the perceived
brand positioning. Consequently to these affirmations, from the online survey
emerged that participants are more inclined to interact on social media (31.25% of
them on “social networking sites” like Facebook and 41.88% of them on “microblogging
sites” like Twitter). Therefore, these results suggest that the most
appropriate strategic approach for an effective brand positioning and customer
engagement for a start-up entering in a new market, should be to use these online
tools to create a certain perception in the customer mind-set, that will guarantee to
match intended and perceived brand positioning (Fuchs and Diamantopoulos 2010),
and at the same time to give the image of an actively interacting organization.
5.2 Further research
The final paragraph of this chapter will place its focus on discussing possible
further research opportunities drawn by the methodology and limitation of this
research project. Suggestions will be made from both practical and academic
viewpoint.
With regards to academia, as mentioned previously, the literature about
segmentation, targeting and positioning for small-medium enterprises is still limited
(Jones and Rowley, 2009). Thus, researchers should focus their studies not only to
practices of big and already established enterprises, but also on how small and
medium ones should succeed in the market. Otherwise, the entrepreneurial spirit of
small entrepreneurs will be left without guidance and small businesses will be
destined to perish with the time in favour of the big organisations. In addition, a
bigger amount of research will be helpful in order to improve the recommendations
of this study. On the other hand, from a practical perspective, researchers could
42 Angelo Guida C1432680
improve the quality of this study by analysing not only the requirements that a frim
should use for entering or penetrating a market, but they should focus on creating
viable suggestions on how make the business sustainable in the market after the
entrance. Therefore, the focus of further researches should be placed also on
exploring possible “tactics” or activities that could allow a long-term sustainable
advantage for a young business. For example, focus groups or one-to-one interviews
could be done with customers in their post-sales experience of the product or of the
service, in order to gain further insight on their preferences and also to keep that
sort of interaction that will keep the customer engaged to the firm.
Angelo Guida C1432680 43
6. Reflective Report
This reflective report will look to examine the learning objectives gained
during the taught courses of the Cardiff MBA and how they have been used during
the construction of this research project. Firstly, there will be a brief introduction
about the meaning of reflection and this will be linked to the impact that it had on
my academic experience. Following this step, the examination will focus on how my
previous work experience helped me to expand my taught knowledge. Furthermore,
there will be a critical analysis on the limitation that these projects encountered due
to the forms of methodology applied and due to missing elements in some taught
modules and how they could be improved.
Wilkinson and Wilkinson (1996) defines the importance of reflective practices
as “an active process whereby the professional can gain an understanding of how
historical, social, cultural and personal experiences have contributed to professional
knowledge and practice”. This definition help us to understand the importance of
adopting adequate reflecting processes for a researcher, in order to produce a
quality piece of work.
The process of reflection for this research was highly influenced by the
knowledge acquired during the taught modules of the MBA course. In particular, the
module that influenced the most this research was the BST513 Marketing module,
since it gave me strong insights about segmentation, targeting and positioning.
However, other modules like BST523 Marketing management and BST522 Strategic
management played an important role in building a strategic and logic structure to
the research itself. In addition, the tutorials and the case studies provided during the
modules added practical value to the application of the gained knowledge.
Furthermore, the information achieved during this the taught experience helped me
to understand rapidly and effectively the problems and the needs of the client –
subject of this research – in order to provide immediate solution for the short term
problems. Indeed, one of the examples that supports this affirmation is related to
44 Angelo Guida C1432680
the time when I suggested to the client to make modifications regarding the layout
of the website for improving its efficacy. As consequence, the client liked
immediately the proposed suggestions and the layout of the website was modified
as suggested.
This research also benefit from my previous work experience as Account
Manager with a company that operates in the IT industry. Indeed, by working closely
with different types of media devices I had the opportunity of gaining a better
understanding of the issues and application of these devices that eventually, will
evolve with the Internet of Things technology. In addition, from the commercial side
of the role, I acquired a practical understanding of how customers think and react to
different business practices. This last concept was very useful in order to create good
positioning strategy to place the product in such a way to satisfy the customer
needs.
However, it is important to take in consideration several limitations due to
lack of taught information during the modules, and also limitations related to the
methodology research type. Firstly, the limitations related to taught knowledge is
linked especially to the evidence based management module taught during semester
3. Indeed, the general opinion about this module is that too much time was spent on
teaching theoretical principles rather than focusing of showing practical examples of
projects and how to build your research on them. In addition, the BST537 Electronic
Business module does not give enough insight about how businesses need to
structure their strategy according to the technological development of the IT
industry. The focus of the module is mostly placed on repeating and adapting basic
concepts of Marketing and Supply chain without any further new insight on specific
matters like how modern businesses should adapt and shape their strategy
according to the new technologies. On the other hand, other limitations are related
with the methodology research, because the time constrains required by the faculty
to finish the project are not adequate for building a proper literature review and
conduct a proper market analysis. Despite using primary research, the tools that the
university offers to students for conducting research are very limited. Indeed, the
Angelo Guida C1432680 45
business school should provide students with survey platforms like “Survey Monkey”
with the inclusion of a premium account, like they do for the Microsoft Office
package. The only tools that students have at their disposal are the library for books
and the online databases for further information. However, with these limitations it
is fairly hard to conduct a proper and accurate research, especially since the
standards required by the university are quite high and precise. Consequently to
these constrains, the survey is still the best way to conduct a research, because it is
quick and answers can be gathered more easily. However, the usage of group focus
and face-to-face interviews would have been more beneficial for the quality of this
research.
To conclude, this research experience in this new market that is the Internet
of Things, helped to increase my personal knowledge of how the market will evolve
in the next ten or fifteen years. Also, being selected among a valid group of students
for having the opportunity of organizing in first person the segmentation, targeting
and positioning strategy for a real business felt highly rewarding. Indeed, obtaining
this project felt like an important achievement at the end of this year, which shaped
my working attitude to be conformed to management criteria. However, the
mentioned constrains became an important limitation, which decreased the quality
of the research, since that no further studies could be done. In addition, the taught
modules should provide continuously update content, because most part of the
knowledge delivered felt repetitive and not in line with the current development of
the management practices. Finally, I believe that despite these limitations the quality
of this project will leave the company in a good position to move forward to meet its
ambition and its goals for the coming future, thanks to the given business
recommendations.

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