Global market segmentation will become more necessary as international marketing increases. With that in mind, this post covers four major reasons to use cross border market segmentation.

These reasons include:

• More businesses market across borders.
• Marketing across borders demands global market segmentation.
• Market characteristics can’t be generalized across borders or cultures.
• Market segmentation research must be conducted for each nation and culture.

Reason For Global Market Segmentation 1
More Businesses Market Across Borders

Income from businesses marketing products across national borders continues to grow. For example, “Statistics of Income Studies of International Income and Taxes,” by Lissa Redmiles reveals that foreign and domestic companies applying for USA international tax credits reported a 32 percent real income growth between 1994 and 2002, from $123 to $161 billion.

Manufacturing and information led other industries in international trade with those companies claiming foreign tax credit accounting for 54 percent of all manufacturing and 36 percent of all information income.

An internet search failed to reveal the total number of companies doing business internationally, but Redmiles’ article includes data from the largest 7,500 and 61,615 “domestic corporations controlled by foreign persons.” And these numbers don’t account for international companies not doing businesses with the USA.

Reason For Global Market Segmentation 2
Marketing Across Borders Demands
Global Market Segmentation

Marketing internationally, like marketing within one nation, requires targeting a market segment and learning as much as possible about that segment. But it’s more difficult to gather information about market segments in different nations and across cultures.

For instance, each generation will share some characteristics with the same age group in other nations. But just because the people in each age group experience the same world events doesn’t mean that they interpret those events and are influenced by those events in the same way.

Reason For Global Market Segmentation 3
Market Characteristics Can’t Be Generalized
Across Borders Or Cultures

To use market segmentation across borders requires that you substitute characteristics specific to each nation for those of United States market segments.

In other words, market segmentation research works for all nations, but the details and characteristics by segments will change, sometimes drastically.

Therefore, anyone from another nation wanting to use market segmentation research needs to conduct secondary and/or primary research to determine characteristics by demographic segments specific to markets in that nation.

Reason For Global Market Segmentation 4
Market Segmentation Research
Must Be Conducted For
Each Nation And Culture

Global market segmentation can be visualized though market segmentation using USA segments. However, using

As the world gets smaller through mass media, the Internet, and international and intercontinental travel, characteristics for some demographic segments will become more similar across nations. However, there is presently no universal market segmentation that crosses borders intact.

Reason For Global Market Segmentation
Conclusion

If you are from a nation other than the USA, you can NOT generalize the details in the market segments discussed on this blog, or the research in Know ‘em Sell ‘em: How To Discover The Best Appeals For Your Target Market to residents of your country. But you can learn about USA markets.

If you are not from the USA, but want to market to USA markets, also see Market Segmentation in the United States.

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Posted 3-21-08:
Global Market Segmentation

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