Influence of Market Segmentation on Financial Performance of Fashion Merchandising Shops in Kenya.

Abstract

Segmentation is the division of a large market into smaller homogeneous markets targets on the basis of common needs. Segmentation allows the fashion merchandising practices to better satisfy the needs of its customers and its growth. To be successful in fashion, merchandisers need to segment their fashion merchandise on financial performance so as to identify consumer behavior and anticipate their needs in all seasons. This study therefore sought to study influence of market segmentation on financial performance of fashion merchandising shops in Kenya. The study specifically focused on the influence of price and age. The study adopted, consumer demand theory, social learning theory. The study used descriptive survey design to obtain in-depth information from the respondents. The target population of this study was fashion merchandising shops in Kenya. The unit of analysis was 609 fashion merchandising shops. The unit of observation was the owner/manager of merchandising shops. Each shop produced one respondent who was either the owner or the shop manager. The study sample size was 167 respondents. Quantitative data was analysed by use of Statistical Package for Social Sciences (SPSS) version 24. Multiple regression analysis was employed to generate the regression model that was used in the study. The study findings showed that price and age have a positive and significant influence on financial performance of fashion merchandising shops in Kenya. The study concluded that offering of competitive price to products improves performance by attracting customers of different segments. Offering of discounts and credit purchase also attracts customers and hence increase customer base. Fashion shops should also offer discounts and credit purchase to attract customers in order to increase customer base. This is because competitive prices represent value for money that attracts customers and this helps in creating a good customer relationship and strengthening the customer loyalty which ultimately improves the performance of the fashion company.