Market segmentation Research Paper Example | Topics and Well Written Essays - 500 words

Market segmentation - Research Paper Example The market could be segmented into three major groups – young adults (age 22 to 35), middle – aged (age 36 to 50) and senior citizens (51 years and above). Nevertheless, the business scope (in terms of sales volume) of Chevy Volt is relatively high for first two segments because these consumers are tilted towards new hybrid vehicles and eco-friendly products (Welch, 2010). It is justified to argue that GM has currently a small market because there are fewer customers in the market that could easily acquire a $40,000 car in bleak economic scenario (inflation, high gas / fuel prices and unemployment). Indeed, GM sold only 647 vehicles in first 2 months of launch that confirms aforementioned argument (Jin, 2011). It should be emphasized that GM competes with Japanese makers like Toyota, Honda and Nissan that could easily produce and market a hybrid in range of $17,000 – 33,000. Therefore, GM has been planning to increase its production and sell 25,000 units a year. This would definitely enable GM to reduce Volt’s total market price by $8,000 – 12,000, thereby increasing its competitiveness and attracting a large pool of middle – middle customers.