Book: Business Marketing: Connect Strategy, Relationships, and Learning second edition. Chapter 5: Market Opportunities. Case 5.2 Market Segmentation at WCP:

B. J. Wickett and Jennifer Modabe were looking at market and share data recently distributed by the analytical staff at WCP (formerly Watson Cooking Products), a midsized manufacturer of institutional foods and supplies. WCP used its own sales force and a system of regional distribution centers to service customers nationwide. Advertising in trade publications and a substantial commitment to industry trade shows supported the efforts of the professional sales force. B. J., a recent hire from a consumer packaged goods firm, argued that WCP had neglected key industries. Look at these numbers! WCP is on the verge of becoming a minor player unless we boost our marketing here, here, and here, he exclaimed, pointing to the following table. Jennifer countered that really no firm had been able to dominate every segment. Furthermore, we should leverage our current channels and within-industry reputation by further penetrating markets where we are strong.

The recent analysis of the market for cooking oils produced the following data:

Question: What opportunities for WCP are indicated by this analysis?

Highest 25% Middle 50% Smallest 25% Total volume Institutions Accounting for These Amounts of Total Spending on Oils (Est. WCP Share) Hospitals Hotels Restaurants Universities 400 (50%) 5,000 (20%) 24,000 (25%) 2,000 (30%) 28,000 (15%) 80,000 (45%) 3,000 (50%) 30,000 (40%) 180,000 (20%) $200 700 900 Number of firms 5,400 63,000 284,000 Highest 25% Middle 50% Smallest 25% Total volume Institutions Accounting for These Amounts of Total Spending on Oils (Est. WCP Share) Hospitals Hotels Restaurants Universities 400 (50%) 5,000 (20%) 24,000 (25%) 2,000 (30%) 28,000 (15%) 80,000 (45%) 3,000 (50%) 30,000 (40%) 180,000 (20%) $200 700 900 Number of firms 5,400 63,000 284,000