Strategy-aligned fuzzy approach for market segment evaluation and selection: a modular decision support system by dynamic network process (DNP)

Authors

1 Department of Industrial Engineering, K. N. Toosi University of Technology, Tehran, Iran

2 Department of Industrial and Mechanical Engineering, Qazvin Branch, Islamic Azad University, Qazvin, Iran

3 Department of Industrial Engineering, Karaj Branch, Islamic Azad University, Alborz, Iran

Abstract

In competitive markets, market segmentation is a critical point of business, and it can be used as a generic strategy.
In each segment, strategies lead companies to their targets; thus, segment selection and the application of the
appropriate strategies over time are very important to achieve successful business. This paper aims to model a
strategy-aligned fuzzy approach to market segment evaluation and selection. A modular decision support system
(DSS) is developed to select an optimum segment with its appropriate strategies. The suggested DSS has two main
modules. The first one is SPACE matrix which indicates the risk of each segment. Also, it determines the long-term
strategies. The second module finds the most preferred segment-strategies over time. Dynamic network process is
applied to prioritize segment-strategies according to five competitive force factors. There is vagueness in pairwise
comparisons, and this vagueness has been modeled using fuzzy concepts. To clarify, an example is illustrated by a
case study in Iran's coffee market. The results show that success possibility of segments could be different, and
choosing the best ones could help companies to be sure in developing their business. Moreover, changing the
priority of strategies over time indicates the importance of long-term planning. This fact has been supported by a
case study on strategic priority difference in short- and long-term consideration.

Keywords