Abstract:

Growing liberalization in international marketplace and high domestic competition force companies to expand to global market. Global expansion activities are ever more significant for growth and prosperity of modern companies. Currently, companies are forced to look for new proposals to be able to compete in an ever-increasing competitive environment. Marketing segmentation is used for targeting a smaller, relatively homogenous market and is helpful for marketers to reach the chosen segment of customers effectively with one marketing mix. This paper is focused on the geographical segmentation of EU market where a size of population and gross domestic product per capita of the countries define the potential of those markets. For the purposes of market segmentation agglomerative hierarchical clustering was used and the Ward’s criterion was applied as the suitable statistical method. On the basis of given output the fundamental marketing proposals were formulated for new entrants to EU market.