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Market Segmentation Strategies Explained

Market segmentation involves dividing a target market into subgroups with common needs, characteristics or behaviors in order to design tailored products and marketing strategies. There are four main types of market segmentation: behavioral, geographic, demographic, and psychographic. Behavioral segmentation examines user status, usage rate, and benefits sought. Geographic segmentation considers region, climate, and population. Demographic segmentation analyzes factors like age, gender, income and occupation. Psychographic segmentation focuses on emotional appeals related to values, attitudes, lifestyle and personality. Effective segmentation identifies mutually interested groups that can be targeted and positioned to appeal to their specific needs and wants.

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Shubhekchha Neupane Panday
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373 views32 pages

Market Segmentation Strategies Explained

Market segmentation involves dividing a target market into subgroups with common needs, characteristics or behaviors in order to design tailored products and marketing strategies. There are four main types of market segmentation: behavioral, geographic, demographic, and psychographic. Behavioral segmentation examines user status, usage rate, and benefits sought. Geographic segmentation considers region, climate, and population. Demographic segmentation analyzes factors like age, gender, income and occupation. Psychographic segmentation focuses on emotional appeals related to values, attitudes, lifestyle and personality. Effective segmentation identifies mutually interested groups that can be targeted and positioned to appeal to their specific needs and wants.

Uploaded by

Shubhekchha Neupane Panday
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPT, PDF, TXT or read online on Scribd

Market Segmentation

Subu Shrestha
Director, Business Advantage

Why?

You cant target everybody Your product/service is not for everybody You dont have enough funds You dont have enough time

What do you do?


Identify a common group of people Aggregate their mutual interests and needs

How?
Behavioristic Geographic Demographic Psychographic

Behavioristic

User Status

Non-user, ex-user, first-time user, regular user Light, medium, heavy

Usage Rate

Purchase occasion

Regular, special
Economy, Convenience, Low fat

Benefits Sought

Geographic

Region

Terai, Hills, Mountain Cold, Moderate, Hot Dense, Medium, Sparse Urban, Suburban, Rural

Climate

Population

Demographic

Age Gender Family size Income Occupation Education Nationality Religion Ethnicity

Psychographic Emotional Appeal

Values

Truly Asia A diamond is Forever


Be Stupid Impossible is Nothing Lifes good If it wasnt in VOGUE, it wasnt in Vogue Think Different A Sharper Bite

Attitudes

Lifestyle

Personalities

Aggregating

Finding and averaging the mutual interests of the groups identified

Establish needs, wants and characteristics (insights) of the group.


Clinic Plus - Glowing Mothers. My familys health/appearance reflects on me. BMW Ultimate Driving Machine. Its about the car and driving experience. Everything else is second.

Extrapolate it to a larger market for greater reach, sales and thus profits

Target Market

Narrow down to one or more target a company wishes to appeal to, design products for, and tailor its marketing activities toward. For advertisers, it helps determine the content, look and feel of advertising

Criteria for Target Markets

Size

The current size of the market and potential for growth Who are the players currently in this market

Competitive position

Cost of reaching the market

Can the available budget reach this market effectively

Compatibility with the organizations objectives and resources.

Ethical issues

Product Lifecycle

Introductory

Maturity

Educate customers Create a need Significant expenses Sales rise Repeat purchases Competitors crop up

Growth

Saturated market Very less new customers Innovation required Obsolete Losses

Decline

Product Positioning

What the product does and who it is for


David Ogilvy

What makes you unique Who should be buying it

Purpose: Product Differentiation

Positioning Strategies

Product Attributes

Formulation (Complan), Ingredients (FAL Ayurvedic), Technology (Apple) Health (Lifebuoy), Safety (Volvo), Sex appeal (Axe), Confidence (CloseUp), Satisfaction (Snickers) Time (After 8), Wedding (Tanishq)

Benefits

Usage Occasions

Product Branding

Branding enables advertising and thus, choice Name, Symbols, Packaging, Image and Personality that distinguishes it from the competition

Offers instant recognition and identification Promise consistent, reliable standards of quality, taste, size, etc. Customer loyalty Long term profits

Ultimate goal: Brand Equity


Brand Equity

Intangible, yet worlds top brands have value worth billions of dollars

When people consciously make a choice of one product over another, they are exercising their brand preference which are instilled by advertising. Then image of the Marlboro Man has endured over 50 years

Types of Brands

Individual brand

Unilever markets toothpastes with individual brands such as Close-Up and Pepsodent Bajaj wants to go for individual brands instead of Family/Umbrella Brand. Dabur and TATA markets all its products under one umbrella of Dabur

Family brand

Top 10 Brands (Global) 2012


10. Toyota 30 billion dollars 9. Samsung 32 billion dollars

8. Intel 39 billion dollars


7. McDonalds 40 billion dollars 6. GE 44 billion dollars

5. Microsoft 58 billion dollars


4. Google 70 billion dollars 3. IBM 75 billion dollars 2. Apple 76 billion dollars 1. Coke 78 billion dollars
Source: Interbrand

Thank You!
subushrestha@[Link]

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