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Page 1: Market segmentation
Page 2: Market segmentation

MARKET SEGMENTATIONMarket segmentation is based on fact that

markets are heterogeneous & not homogeneous.Homogeneous market refer to a market situation

where the prospective buyers of any product are found to be uniform in their needs, habits, choices, nature, etc.

Heterogeneous market refer to a market situation where the prospective buyers of any product are not found homogeneous in their needs, habits, choices, nature, etc.

Page 3: Market segmentation

Cont’d…Market segmentation refers to dividing the

heterogeneous markets into smaller customer groups having certain homogeneous characteristics. Such as income, age, sex, etc.

They may differ on the basis of income, gender, age, education, profession, religion, social class, family life, style, culture etc.

Page 4: Market segmentation

DEFINITIONAcc to William J. Stanton“ Market Segmentation consist of taking the

total heterogeneous market for a product & dividing it into several sub markets or segments each of which tends to be homogeneous in all significant aspects.

Acc to Philip Kotler Market segmentation is the sub-dividing of a

market into homogeneous subset of consumers , where any subset may conceivably be selected as a market target to be reached with a distinct marketing mix.

Page 5: Market segmentation

OBJECTIVES OF M.STo make grouping of customers on the basis of

their homogeneous characteristics.To identify the needs, tastes, buying-motives of

target customers.To determine marketing strategies, targets &

goals of the firm.To make the activities of the firm consumer

oriented.To identify the areas where the customers may be

created and market area can be expanded.

The main aim of market segmentation is to prepare separate marketing programmes or strategies for each segment so that maximum satisfaction to consumers of different segments may be provided.

Page 6: Market segmentation

Reasons for the development of M.SCustomer-Orientation

Technological Advancement

Use of cost reducing techniques

Increase in purchasing power

Increase in competition

Page 7: Market segmentation

Requirement/ Criteria For Effective Segmentation Identifiable

Measureable

Accessible

Responsive

Significant

Substantial

Page 8: Market segmentation

APPROACHES OF M.SThe marketeers adopt several app. To segment a

market.

App. To market segmentation

Mass Marketing

Product Differentiation

Marketing

Target Marketing

Page 9: Market segmentation

MASS MARKETING In this total market is considered as one segment. Under mass marketing only one product is

produced & sold in the market for all customers with help of common marketing programme.

It assumes that there is no significant difference amongst Consumers in terms of their need & wants

e.g. coca-cola

Page 10: Market segmentation

PRODUCT DIFFERENTIATION MARKETING

In this marketing, marketeers uses product differentiation app.

Once marketeers learnt that consumers would not accept one quality product, the marketeers try to provide different size, colours, shapes, features & qualities in his product as per the needs & wants of the customer of different segments.

It provide different product to different segmentE.g. maruti udyog ltd.

Page 11: Market segmentation

TARGET MARKETING

It defined as a set of actual potential buyers of a product, service or idea .

Target marketing help the marketeer to correctly identify the market- the groups of consumers for whom the product is designed.

It has 3 steps :-

1. Market segmentation

2. Market targeting

3. Product positioning

Page 12: Market segmentation

Segmentation Process

Analyse the characteristics of customers

Disaggregate the customers into suitable segments

Formulate different marketing mix for different segments

Feedback of various segments

Select the higher potential segments

Analyse the needs of Customers

Page 13: Market segmentation

BASIS OR CRITERIA OF M.S

The step towards developing a segmentation strategy is to locate the bases or basis for segmenting the market.

There are two simple division of product market.

I. Consumer market

II.Industrial market

Page 14: Market segmentation

On the basis of consumer market

1. Geographical basis

2. Demographic basis

3. Psychological basis

4. Behavioral basis

5. Marketing basis

Page 15: Market segmentation

1) GEOGRAPHICAL BASISIt is the most simple, convenient, popular,

and usual base for mkt segmentation.It includes :

AreaRegionCity sizeDensityClimateUrbanization

Page 16: Market segmentation

2) DEMOGRAPHIC BASISUnder this basis, a market tries to differentiate

between groups of customers on the basis of demographic variables.

It includes:-Gender AgeIncomeEducationReligionNationality

Page 17: Market segmentation

Cont’d…OccupationMarital StatusFamily sizeFamily life-cycle

Page 18: Market segmentation

3) PSYCHOGRAPHIC SEGMENTATION It describe the human characteristics of

consumers. It segment the market on the basis that how people act.

These include:-Personality Life-style Social classCultureValuesBeliefsAttitude

Page 19: Market segmentation

4) BEHAVIORAL SEGMENTATIONConsumer behavior may also form the basis of

market segmentation. It includes:-

OccasionsBenefits

QualityServiceEconomySpecially

Page 20: Market segmentation

Cont’d…Users status

Non-userPotential userFirst time userRegular userEx-user

Buyer-Readiness Stage Unaware Aware Informed

Page 21: Market segmentation

Cont’d… Interested Desired Intended to buy

User RateLoyalty status

Hard core loyal Soft core loyal Switchers

Page 22: Market segmentation

5) MARKETING BASISMarketing conditions also form an important

basis for market segmentation.There are latest variables used by modern

marketeers.This include:-Degree of competitionChannels of distributionBuyer with price consciousness

Page 23: Market segmentation

ON THE BASIS OF INDUSTRIAL PRODUCT

1. Type of business activities basis

2. Geographical location basis

3. Usual purchasing procedure basis

4. Size of user

Page 24: Market segmentation

IMPORTANCE OF MS Knowledge of marketing opportunities Knowledge of customer needs Adopting effective marketing programme Proper allocation of resources Adjustment in products Increasing sales volume Better assessment of the competition Effective advertising appeals Enhances marketing efficiency Benefits to consumers