Chapter 2: Basic Marketing
Concepts
SECTION 2.2
MARKET SEGMENTATION
What You’ll Learn
What market segmentation is and the four methods
used to segment a market
The current demographic, psychographic, and
geographic trends
Analyzing Markets
Market Segmentation is a way of analyzing a
market by specific characteristics in order to create a
target market.
Methods:
1.
2.
3.
4.
Demographics
Psychographics
Geographics
Product Benefits
Demographics
Demographics – statistics that describe a
population in term of personal characteristics which
include:
age
gender
income
ethnic background
education
occupation
Psychographics
Involves studies of consumers based on social
and psychological characteristics.
Trends:
Health (Kellogg’s Special K)
Workplace (Dressing Down)
Geographics
The segmentation of the market based on where
people live.
Where people live is often studied in relation to age,
ethnic background, and income.
Product Benefits
Segmenting a market by product benefits involves
studying consumers’ needs and wants.
Example:
Nike (running, walking, tennis, basketball, soccer, baseball,
football, etc.)
Coke (diet, caffeine free, zero, etc.)
Quiz
1.
Name four methods of segmenting a market.
2. What is the definition of demographics?
3. T/F: Psychographics is a way of segmenting a
market.
4. T/F: Geographics is the process of segmenting a
market based on where people live.
5. List an example of segmenting a market by product
benefits.
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