Final answer:
A market segment that is large or profitable enough to serve is termed substantial. This characteristic is essential for a company to justify investing in targeting that segment. The substantiality ensures that the segment has enough potential or purchasing power to be worth the marketing efforts.
Step-by-step explanation:
When a market segment is large or profitable enough to serve, it is termed substantial. This means that the market segment holds enough potential customers to be worth targeting by a company. If it is too small or not profitable, companies may decide that it is not worth the investment to tailor products or marketing strategies to that segment.
In the context of market segmentation, being substantial indicates that there is a sufficient number of potential customers or that the segment has significant purchasing power to justify the costs associated with serving that segment. This also involves evaluating if the segment's revenue potential is significant in contrast to the costs of reaching and serving the segment.
Understanding Market Segment Substantiality
The concept of a segment being substantial is crucial in segmenting a market effectively. It ensures that the resources allocated to target the segment are justified. Other characteristics of a good market segment include being measurable, accessible, actionable, and differentiable, but none of these aspects matter if the segment is not substantial in terms of size and profitability.