Market Definition at the SBU Level

Strategic Business Units
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Marten van der Zee
Analyst, Netherlands

Market Definition at the SBU Level

A market definition at an SBU is defined in the same way as it would for an entire company. But there are 2 differences between market definition at the company level and at the SBU level:
1. Because marketing plans are made for the SBU, the market definition should be more concrete.
2. The market for an SBU is smaller compared to a company.
The sum of all market definitions of all SBU's will approximately add up to the market definition for the entire company.
Note that the definition of customer need has a direct impact on the ''range of the competition''. After all, a competitor is by definition a supplier that can satisfy the same customer need. Product characteristics can also used when defining a market definition.

 

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