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INTERNATIONAL CUSTOMER SEGMENTATION: Critically evaluate the perceived segmentation strategy of an organization of your choice, which operates on an international scale. (The organization must be specified, but remember this is an academic essay and not merely a case study. If it is a large, complex organization with many different types of products/services, you can just focus on one brand)

The aim of this essay is to critically evaluate the international customer segmentation strategy of Haier Group, starting with a brief introductory summary of Haier’s background, initial development in China and an insight into Haier’s international marketing activities, followed by Haier’s international customer segmentation strategies orientation and its segmentation strategic approach. Haier’s collaborative arrangement and corporate culture in which relate to segmentation strategies will be examined at the end.

In the last two decades, the impact of globalization provides China opportunities to be a major player on the global scale. Chinese companies have started to create truly international brand, the most successful one is Haier Group, it is the largest manufacturer of “white electric appliances” in China, and the fifth largest in the world. With annual sales of RMB 71.1 billion   (£5.1 billion), the Qingdao-based Company manufactures 13,000 different products range from refrigerator group, washer group, air conditioner group and other wide range of electronic groups, it employs over 30,000 people, and sells its products in 160 countries (Haier, 2007).

Haier was originally founded in Qingdao, Shangdong Province in China in1984, initially named as Qingdao refrigerator Plant, founded by non-government group. It was a state owned small factory with about 600 employees. However, Haier did not obtain any investment from the state as other state-owned enterprises had done at that time (Chen, Jin, He and Yao, 2006).
According to SAP (2003), Haier incorporated as a group company in December 1991. The company had a defining moment at the beginning of operations, when the chief executive officer (CEO) Mr. Zhang picked up a sledgehammer and began to smash newly assembled refrigerators - to prove that poor quality home electronic products would no longer be tolerated. Haier’s early focus on quality was the core strategy in Chinese market; it also contributed to the company’s rapid growth. Sales had increased an average of 73.8% per year from 1984 to 2002 (Haier, 2007).

Jobber (2001) argues undifferentiated marketing strategy can occur by fault, a company who practice with the strategy may link to lack of marketing orientation and customer knowledge. Moreover ‘‘undifferentiated marketing strategy is more convenient for managers since they have to develop only a single product’’ (Jobber, 2001 p204). He also suggests that a company starts with undifferentiated marketing strategy, normally will move to one of the next three target marketing strategies: differentiated, focused and customized marketing. However, here Jobber did not clearly analysis whether the undifferentiated marketing is suitable for MNEs to develop only one type of product in the global scale, or a typical region. In this case, the undifferentiated marketing strategy was the main factor drove other home-based electronic companies to lose market share in China.

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