Market Segmentation by Jerry W. Market segmentation is a much broader concept, however, and it pervades the practice of business throughout the world. What is market segmentation?
Simple though it may be, it is of vital Segementation marketing to forming any marketing plan. What is Market Segmentation? Market Segmentation is a process of dividing the market of potential customers into different groups and segments on the basis of certain characteristics.
The member of these groups share similar characteristics and usually have one or more than one aspect common among them. There are many reasons as to why market segmentation is done. One of the major reasons marketers segment market is because they can create custom marketing mix for each segment and cater them accordingly.
The concept of market segmentation was coined by Wendell R. Present-day market segmentation exists basically to solve one major problem of marketers; more conversions.
More conversion is possible through personalized marketing campaigns which require marketers to segment Segementation marketing and draft better product and communication strategies according to needs of the segment.
These bases range from age, gender, etc. Gender Gender is one of the most simple yet important Segementation marketing of market segmentation. The interests, needs and wants of males and females differ at many levels. Thus, marketers focus on different marketing and communication strategies for both.
This type of segmentation is usually seen in the case of cosmetics, clothing, and jewellery industry, etc. Age group Segmenting market according to the age group of the audience is a great strategy for personalized marketing.
Most of the products in the market are not universal to be used by all the age groups. Hence, by segmenting the market according to the target age group, marketers create better marketing and communication strategies and get better conversion rates.
Income Income decides the purchasing power of the target audience. It is also one of the key factors to decide whether to market the product as a need, want or a luxury. Marketers usually segment the market into three different groups considering their income.
Place The place where the target audience lives affect the buying decision the most. A person living in mountains will have less or no demand for ice cream than the person living in a desert. Occupation Occupation, just like income, influences the purchase decision of the audience. A need for an entrepreneur might be a luxury for a government sector employee.
Usage Product usage also acts as a segmenting basis. A user can be labelled as heavy, medium or light user of a product. The audience can also be segmented on the basis of their awareness of the product.
Lifestyle Other than physical factors, marketers also segment the market on the basis of lifestyle. Lifestyle includes subsets like marital status, interests, hobbies, religion, values, and other psychographic factors which affect the decision making of an individual.
Types of Market Segmentation Geographic Segmentation Geographic segmentation divides the market on the basis of geography. This type of market segmentation is important for the marketers as people belonging to different regions may have different requirements.
For example, water might be scarce in some regions which inflates the demand for bottled water but, at the same time, it might be in abundance in other regions where the demand for the same is very less.
People belonging to different regions may have different reasons to use the same product as well. Geographic segmentation helps marketer draft personalized marketing campaigns for everyone. Demographic Segmentation Demographic segmentation divides the market on the basis of demographic variables like age, gender, marital status, family size, income, religion, race, occupation, nationality, etc.
This is one of the most common segmentation practice among the marketers. It is believed that the knowledge of the product and its use affects the buying decision of an individual.
People can be labelled as brand loyal, brand-neutral, or competitor loyal. They can also be labelled according to their usage.
Psychographic Segmentation Psychographic Segmentation divides the audience on the basis of their personality, lifestyle and attitude. This segmentation process works on a premise that consumer buying behaviour can be influenced by his personality and lifestyle.
Lifestyle is how a person lives his life. Personality and lifestyle influence the buying decision and habits of a person to a great extent.
A person having a lavish lifestyle may consider having an air conditioner in every room as a need, whereas a person living in the same city but having a conservative lifestyle may consider it as a luxury.Definition of market segmentation: The process of defining and subdividing a large homogenous market into clearly identifiable segments having similar needs, wants, or demand characteristics.
Its objective is to design a marketing mix. Marketing > Segmentation. Market Segmentation. Market segmentation is the identification of portions of the market that are different from one another.
Segmentation allows the firm to better satisfy the needs of its potential customers. Market segmentation is the activity of dividing a broad consumer or business market, normally consisting of existing and potential customers, into sub-groups of consumers (known as segments) based on some type of shared characteristics.
Today, Segmentation, Targeting and Positioning (STP) is a familiar strategic approach in Modern Marketing. It is one of the most commonly applied marketing models in practice. In our poll asking about the most popular marketing model it is the second most popular, only beaten by the venerable SWOT / .
To segment a market, you divide your potential customers into different groups. Millennials, Generation X and baby boomers, for instance, or fans of thrillers, paranormal romance and horror. Then. Market segmentation is the activity of dividing a broad consumer or business market, normally consisting of existing and potential customers, into sub-groups of consumers (known as segments) based on some type of shared characteristics.