E-Market Segmentation for Internet-Mediated Fashion Brands: A Conceptual Framework with Mean-Variance Consideration

Abstract

E-market segmentation takes a crucial role in marketing for fashion brands. Its applications for collaborative functions such as estimating the advertisement budget, retaining customers, carrying out direct tailored marketing, and implementing dynamic pricing are essentially important and critical for their e-business. Unlike the bricks-and-mortar traditional store retailers, fashion brands which operate online can keep track of the details of the online customers easily and precisely. How to make use of these customers’ details in segmenting the e-market for each particular function becomes an important issue. As a result, we propose and discuss in this paper the conceptual models for carrying out e-market segmentation and we focus on the areas of dynamic pricing and advertisement budget estimation. Through extensive discussions with mean-variance considerations, we believe that the models can be incorporated into other existing market segmentation analyses. Managerial implications are discussed.