e this opportunity to gain the brand recognition. We had to break the stereotype and make people think our product is a high quality one though it is made in Russia. We should use this time when foreign competitors are destroyed to capture some market share in which the people would have positive attitude towards our product. p> We can also estimate that the overall capacity of the market of pastas will decrease since the most dangerous for us substitute of pastas, potato, have not became significantly more expensive. p> Trying to estimate the market capacity of our product, we meet some difficulties:
В· There are a lot of small manufacturers and the market is saturated with their products, and they do not declare their true level of production to reduce or completely avoid taxation.
В· Pastas are sold in the outdoors markets without cash registers, some pastas are imported through Byelorussia to avoid Russian customs.
That means we cannot trace the quantity of pastas manufactured in the city using top-down approach. The only powerful mean of estimating the capacity of the market we still have at our disposal is the bottom-up approach. We can figure out how much pastas an average person consumes and it will give us an idea about the capacity of the market.
Market segmentation.
My next step was to segment the market.
In my opinion, the most important variable of segmenting of the pastas market is consumer's family income per head. Later we can apply a kind of sub-segmentation to some of the segments to divide them into smaller ones using another variables.
The segments we can name are the following:
1) "Low class" [5]. Poor people. Their income per head is below 500 roubles. Since they have to make a living somehow, they will want to save on anything. They will most probably buy low quality pastas. The following social groups belong to this segment:
ВЁ Pensioners,
ВЁ Jobless people,
ВЁ Families with more than 3 children,
ВЁ Public employees (doctors, teachers).
ВЁ People who are not paid for their job
Though their income is low, this segment is important because of its size. p> 2) "Lower middle class ". This category will denote people with income per head from 500 roubles to 900 roubles per month. They are able to satisfy their needs for food, though they will try to save on it because their disposable income is still low.
We can name the following groups of people who match this definition:
ВЁ working pensioners;
ВЁ retired officers;
ВЁ public employees [6];
ВЁ workers and employees of different professions, usually not complex ones;
3) "Higher middle class ". People with an income of 900 to 1500 roubles per head per month will be included in this segment. These people have a significant disposable income for Russia. This means sometimes they will prefer the quality to the price, but the price still is of the highest importance.
To this segment belong:
ВЁ white collars, office workers;
ВЁ representatives of complex professions;
ВЁ representatives of militia, army, tax police, etc.
4) "High class". We will encounter in this category everyone whose income per head is higher than 1500 rubles per month. These people have a big disposable income for Russia. At least they can afford buy the pastas they like. This means we can expect the price elasticity of this segment to be the lowest one. The representatives of this segment will be influenced by such factors as brand name recognition, quality of packaging, etc. in the highest degree.
In this segment we can include:
ВЁ small entrepreneurs;
ВЁ people who have a good job, have a good income, but are not entrepreneurs. This category will include a lot of different professions from drivers to butchers.
ВЁ New Russians.
We should underline, though this segment is relatively small (according to the sources of the LBS Corporation, 20-30% in Saint Petersburg), it is huge in its absolute figures. In addition, its representatives have the highest disposable income and are concerned about prestige and self-respect much more than the representatives of the other segments. That is why we can be sure a-priori that this segment will require an elaborated marketing mix of its own. p> We should not deepen our segmentation using other variables because it will complicate our model of the market and the subsegments which will result from this will hardly differ significantly. The deeper segmentation will not be relevant to our problem.
The questionnaire.
Before and during asking the questions try to notice the following:
1. The customer has bought pastas:
ВЁ Automatically manually packed
ВЁ Sort: Corns Shells Spirals Spaghetti Vermicelli
