Cb segmentation final

MARKET MARKET SEGMENTATIONSEGMENTATION

Market segmentMarket segment

The process of dividing a market into The process of dividing a market into distinct subsets of consumer with distinct subsets of consumer with common needs or characteristics and common needs or characteristics and selecting one or more segments to selecting one or more segments to target with a distinct marketing mix.target with a distinct marketing mix.

Need of segmentationNeed of segmentation

• Need, want and desire are not same.Need, want and desire are not same.

• The primary advantage is cost The primary advantage is cost reduction.reduction.

• It avoids head on competition in the It avoids head on competition in the market place.market place.

How segmentation operatesHow segmentation operates

• Segmentation studies are designed to Segmentation studies are designed to discover the needs and wants of discover the needs and wants of specific groups of consumer, so that specific groups of consumer, so that specialized goods and services can be specialized goods and services can be developed and promoted to satisfy developed and promoted to satisfy each groups needs.each groups needs.

• It is also used to guide the redesign, It is also used to guide the redesign, the reposition, or extending the product the reposition, or extending the product targeting to a new consumer segment.targeting to a new consumer segment.

Segmentation strategies Segmentation strategies The first step in developing a The first step in developing a segmentation strategy is to select the segmentation strategy is to select the most appropriate base on which to most appropriate base on which to segment the market. Eight major segment the market. Eight major categories of consumer characteristics categories of consumer characteristics provide the most popular bases for provide the most popular bases for market segmentation.market segmentation.

– Geographic factorGeographic factor– Demographic factorsDemographic factors– Psychological characteristicsPsychological characteristics

– Sociological variablesSociological variables– Use related characteristicsUse related characteristics– Use-situation factorsUse-situation factors– Benefit soughtBenefit sought– Hybrid segmentation.Hybrid segmentation.

Geographic segmentationGeographic segmentation

In geographic segmentation, the In geographic segmentation, the market is divided by location. The market is divided by location. The theory behind this strategy is that theory behind this strategy is that people who live in the same area people who live in the same area share some similar needs and wants share some similar needs and wants and that these needs and wants and that these needs and wants differ from those of people living in differ from those of people living in other areas.other areas.

DemographicDemographic segmentation segmentation

Demographic characteristics, such as Demographic characteristics, such as age sex, marital status, income, age sex, marital status, income, occupation and education are most occupation and education are most often used as the basis for market often used as the basis for market segmentation. Demographics refers segmentation. Demographics refers to the vital and measurable statistics to the vital and measurable statistics of a population. Demographics help of a population. Demographics help to locate a target market.to locate a target market.

Psychographic Psychographic segmentationsegmentation

Psychographic characteristics refers Psychographic characteristics refers to the inner qualities of the individual to the inner qualities of the individual consumer. Consumer segmentation consumer. Consumer segmentation strategies are often based on specific strategies are often based on specific psychological variables.psychological variables.

1. need and motivation1. need and motivation

2. personality2. personality

3. perception3. perception

4. attitude, etc.4. attitude, etc.

Socio-cultural segmentationSocio-cultural segmentation

Socio-cultural variables such as Socio-cultural variables such as group and culture, provide further group and culture, provide further bases for market segmentation. For bases for market segmentation. For example, consumer markets have example, consumer markets have been successfully subdivided into been successfully subdivided into segments on the basis of stages in segments on the basis of stages in the family life-cycle, social class, the family life-cycle, social class, core culture values, etccore culture values, etc

Use related segmentationUse related segmentation

An extremely popular and effective An extremely popular and effective form of segmentation categorizes form of segmentation categorizes consumers in terms of product, consumers in terms of product, service, or brand usage service, or brand usage characteristic, such as usage rate, characteristic, such as usage rate, awareness status, and degree of awareness status, and degree of brand loyalty.brand loyalty.

Usage-situation Usage-situation segmentationsegmentation

Marketers recognize that the Marketers recognize that the occasion or situation often occasion or situation often determines what consumers will determines what consumers will purchase or consume. For this purchase or consume. For this reason, they sometimes focus on the reason, they sometimes focus on the usage situation as a segmentation usage situation as a segmentation variable.variable.

Benefit segmentationBenefit segmentation

Marketing and advertising executives Marketing and advertising executives constantly attempt to isolate the one constantly attempt to isolate the one particular benefit that they should particular benefit that they should communicate to consumers. Changing communicate to consumers. Changing lifestyle plays a major role in determining lifestyle plays a major role in determining the product benefits that are important to the product benefits that are important to consumers and provide marketers with consumers and provide marketers with opportunities for new product and opportunities for new product and services.services.

Hybrid segmentationHybrid segmentation

Marketers commonly segment markets Marketers commonly segment markets by combining several segmentation by combining several segmentation variables rather than relying on a single variables rather than relying on a single segmentation base.segmentation base.

1. psychographic-demographic1. psychographic-demographic

2. geo-demographic2. geo-demographic

3. VALS 23. VALS 2

VALS IIVALS II

VALS 2 is a marketing and consulting tool that VALS 2 is a marketing and consulting tool that helps businesses worldwide develop and helps businesses worldwide develop and execute more effective strategies. The system execute more effective strategies. The system identifies current and future opportunities by identifies current and future opportunities by segmenting the consumer marketplace on the segmenting the consumer marketplace on the basis of the personality traits that drive basis of the personality traits that drive consumer behavior. VALS applies in all phases consumer behavior. VALS applies in all phases of the marketing process, from new-product of the marketing process, from new-product development and entry-stage targeting to development and entry-stage targeting to communications strategy and advertising. communications strategy and advertising.

Implementing segmentation Implementing segmentation

• Concentrated marketingConcentrated marketing

• Differentiated marketingDifferentiated marketing

• Counter-segmentationCounter-segmentation

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