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In the given case study, Fiserv is a payment and electronic billing company, which is encountering a challenge of coming up with fruitful recommendations that it may present in front of its e-billing partners to increases the adoptions of electronic payment methods for paying bills i.e. e-billing. In order to overcome the challenge, Fiserv has hired a marketing research team, which aims at studying and segmenting the e-billing consumer market. Therefore, this paper focuses on analyzing the finding of the market research team by using the customer value targeting and segmentation strategy in order to help Fiserv developing a message that would help billing companies to move their consumers from traditional paper billing to e-billing methods (Grayson et. al 15).
Fiserv’s Segmentation on Market
Fiserv is looking up to advance in the modern e-billing market on the basis of its market research, which segmented the market into six distinct consumers groups that are prospective and approachable targets for Fiserv to adopt new e-billing procedures. These include;
E-Savvy Planners: This includes consumers who have already aware of the benefit of e-billing and prefer it presently.
Maximizers: This includes consumers who although don’t prefer e-billing currently but value easy access and easy use of information, and are willing to adopt modern methods.
Self-Improvers: Consumers who are willing to use modern e-billing systems, but have minor concerns related to internet security.
Desperate Avoiders: Consumers who don’t use e-billing methods of payment and don’t have an appropriate management system are willing to pay for an advance payment system.
Convenience Seeker: People who have a well-defined management system and prefer having a paper bill for keeping a record.
Paranoid Paper Pushers: Involve people who believe that technological advancements are merely a wastage of time (18).
On the basis of class lectures related to segmentation, the above-mentioned segmentation scheme seemed to be strong enough to market as it clearly elucidates the consumer behavior and psychological attributes towards their perceived potential value and profit for the e-billing system. Moreover, these segments also define the specific needs of every consumer group, which facilitates Fiserv to precisely market each target group with a distinctive message. Though the consumer demographics does not vary vastly; however, their attitudes and behaviors are completely different that can be used by Fiserv to choose the right segment on the basis of the most profitable and accessible group. Having every segment with distinctive behaviors and opinion, Fiserv can play on specific persuasion by crafting a precise positioning statement. Picking up and targeting the most profitable segment, Fiserv should target in defined manners since the mass marketing is not going to work in this case. Because it will create ambiguity among the consumers making them think that the message is not for them specifically. Additionally, communication or marketing medium should also be chosen on the basis of their behavior and accessibility (Babin et.al 46).
Value & Targeting Priorities for Fiserv
In order to choose the most prospective and profitable target market for Fiserv, we have defined three principle criteria that would enable making the maximum selection. This includes the following:
Potential Product Interest: Although they are potentially highly profitable but if Fiserv fails to convert them into adopters of e-billing, then targeting them will be pointless. Therefore, their potential interest should be linked with their behaviors and attitudes. For instance, if they will be non-supporters of technology, then the segment would turn out to be useless (Malhotra et.al 12).
Potential Profit to Fiserv: Apart from anything else, Fiserv needs to focus on the most profitable segment. The potential profit should incorporate the amount of money that it add to the business, segment size, and its impending earnings.
Potential Switching Cost: If the switching cost would outdo the profit, then it will obviously not a profitable segment. Additionally, the cost should be based on the factors like rate of conversion, cost of conversion/switching and estimated saving.
The above table shows that the Maximizers and E-Savvy planners involve the maximum attractiveness. Therefore, the value and targeting priorities for Fiserv are should be Maximizers and E-Savvy planners.
Fiserv would focus to target E-Savvy Planners and Maximizers. The sales forecast is as follows;
Population
Total Population: 118 million households
Target Population: 86 million households
Fiserv Target Population
E-Savvy Planners: 86 million x 19.7% = 16.94 million
Maximizers: 86 million x 24.9% = 21.41 million
Total Fiserv Taget Population: 38.35 million
Sales Forecast (assuming that Fiserv will be able to capture 15% of the market share)
Households (15% of Fiserv Taget Population): 5,752,500 households
Revenue per person/month (As cosumer views e-bill on average of once a month): $0.025
Total expected revenue from e-billing: $143,812 / month
Total yearly revenue from Fiserv e-billing: $1,725,744
Works Cited
Babin, Barry, and William Zikmund. Essentials of marketing research. Nelson Education, 2015. Web.
Grayson , Kent, Leiserson, Eric& Waikar, Sachin. Fiserv Takes on the E-Billing Market: How Can We Get Them to Turn Off Paper? Kellogg Case Publishing. 2009. Web
Malhotra, Naresh K., David F. Birks, and Peter Wills. Essentials of marketing research. Pearson, 2013. Web.
