QUESTION $2[25$ MARKS$]$

Read the following extract and then answer the questions below.

Global Blue: $$Circle are experts in B$2$B research and segmentation$$

From its headquarters near Geneva in Switzerland, Global Blue offers a range of services which help retailers to increase their revenues from the lucrative international traveller market by offering VAT refunds. Having introduced the concept of Tax$-$Free Shopping over $30$ years ago, Global Blue now works with over $270,000$ of the world$$s favourite retailers, shopping brands and hotels in over $40$ countries.

Like many other B$2$B businesses, Global Blue believes that the purchasing behaviour of their target market is largely influenced by their $$firmographic profile$$ their size, their speciality, their home country and so on$.$ However, examples of retailers behaving in unexpected ways, given their firmographic profile, led Global Blue to consider a different viewpoint. Are a

retailer$$s needs and attitudes not a far more powerful predictor of behaviour?

If this was the case then it had far$-$reaching implications. Product development should be driven by the needs of each segment, separate marketing messages should be tailored to resonate with their worldview and sales teams should potentially be organised along different lines. This was an important and exciting revelation.

To develop an alternative approach to segmenting the market, Jorge Casal $($Global Blue$$s Senior Vice President of Tax$-$Free Shopping$)$ invited several research agencies to pitch their approach and ideas. B$2$B specialists Circle Research emerged as a natural choice for this strategically important project. As Alexandre Vukanovic $($Product Retail Manager$)$ who subsequently

managed the project explains: $$Circle are experts in B$2$B research and segmentation. This helped to bring credibility to the project and was a very strong deciding factor for us$.$

Source: Extracted from Circle Research, The B$2$B Experts. www$.$circle$-$research.com

i$)$ Assume that you have been assigned the task of segmenting the market for Global Blue customers. Discuss conditions that are necessary for effective segmentation of the Global Blue customer market. $(10$ Marks$)$

ii$)$ According to the case study, $$product development should be driven by the needs of each segment$.$ Discuss the stages in the new product development process that Global Blue should follow when responding to needs of each segment. $(15$ Marks$)$