Achieving and sustaining competitive advantages is essential for securing strong market positioning and long-term profitability. Effective marketing strategies depend on a nuanced understanding of how marketing mix adjustments influence consumer behavior, particularly in highly competitive markets. In this context, a key consideration is whether firms should pursue a segmented market strategy or adopt a unified approach targeting the entire market. Despite its importance, existing methodologies do not offer actionable insights that simultaneously consider the heterogeneous effects of marketing mix adjustments across segments and account for competitive dynamics. To bridge this gap, we introduce Competitive Segmentation Analysis (CSA), an approach for optimizing marketing mix strategies. Leveraging a dataset of 11.4 million grocery purchases in Germany from 2006 to 2022, CSA evaluates how variations in marketing mix variables affect retailers’ market share relative to competitors. By incorporating market segmentation, CSA determines whether a segmented market approach is advantageous and identifies the consumer segments driving competitive advantages. Our findings demonstrate that targeted, incremental adjustments to marketing mix variables can yield significant competitive advantages. For an exemplary retailer, such adjustments could generate weekly revenue impacts ranging from €38,053 to €.1,419,341 This research provides actionable insights for researchers and practitioners, enabling enhanced competitive positioning and offering broad applicability across industries to advance marketing strategy optimization.
Mergner et al. (Sat,) studied this question.