Lesson Plan

Lesson Plan
Course Title – Marketing Dynamics Unit 2, Lesson 2
Session Title – Market Segmentation
Performance Objective:
After completing this lesson, students will be able to compare and contrast the
advantages and disadvantages of market segmentation and mass marketing,
distinguish market segmentation of geographics, demographics, psychographics and
behavioral segmentation, and explain the nature of marketing planning.
Approximate Time:
When taught as written, this lesson should take three to four days to complete.
Specific Objectives:
Students will be able to compare and contrast the advantages and
disadvantages of market segmentation and mass marketing.
Students will be able to distinguish among geographic, demographic,
psychographic and behavior segmentation.
Students will be able to explain the nature of marketing planning.
Market Segmentation
Product Benefits
Disposable Income
Discretionary Income
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TEKS Correlations:
This lesson, as published, correlates to the following TEKS. Any changes/alterations to
the activities may result in the elimination of any or all of the TEKS listed.
130.347 (c)(5)(B)
… compare and contrast the advantages and disadvantages of market segmentation
and mass marketing …
130.347 (c)(5)(C)
… distinguish among geographic, demographic, psychographic, and behavior
segmentation …
130.347 (c)(5)(D)
… explain the nature of marketing planning …
Interdisciplinary Correlations:
110.31 (b)(21)(B)
… organize information gathered from multiple sources to create a variety of graphics
and forms (e.g., notes, learning logs)…
110.31 (b)(22)(B)
…evaluate the relevance of information to the topic and determine the reliability, validity,
and accuracy of sources (including Internet sources) by examining their authority and
110.31 (b)(23)(C)
… use graphics and illustrations to help explain concepts where appropriate…
110.31 (b)(23)(D)
… use a variety of evaluative tools (e.g., self-made rubrics, peer reviews, teacher and
expert evaluations) to examine the quality of the research…
Occupational Correlation (O*Net - http://www.onetonline.org/)
Marketing Managers - 11-2021.00
Similar Job Titles: Sales Managers, Advertising and Promotions Managers, Green
Managers, Market Research Analysts
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Formulate, direct and coordinate marketing activities and policies to promote
products and services, working with advertising and promotion managers.
Identify, develop, or evaluate marketing strategy, based on knowledge of
establishment objectives, market characteristics, and cost and markup factors.
Direct the hiring, training, or performance evaluations of marketing or sales staff
and oversee their daily activities.
Evaluate the financial aspects of product development, such as budgets,
expenditures, research and development appropriations, or return-on-investment
and profit-loss projections.
Develop pricing strategies, balancing firm objectives and customer satisfaction.
Compile lists describing product or service offerings.
Initiate market research studies or analyze their findings.
Use sales forecasting or strategic planning to ensure the sale and profitability of
products, lines, or services, analyzing business developments, and monitoring
market trends.
Coordinate or participate in promotional activities or trade shows, working with
developers, advertisers, or production managers to market products or services.
Consult with buying personnel to gain advice regarding the types of products or
services expected to be in demand.
Soft Skills:
Active Listening, Reading Comprehension, Critical Thinking, Speaking, Coordinating,
Active Learning.
Teacher Preparation:
Teacher will review the terms in the outline, digital presentation slides and handouts to
become familiar with lesson.
Teacher should locate and evaluate various resources and websites before the lesson.
Teacher will have assignments and website information ready to distribute to students.
Marketing Essentials, Schneider Farese, Kimbrell, Woloszyk, Glencoe McGraw-Hill
Instructional Aids:
1. Display for digital presentation, websites for assignments and class discussion
2. Marketing Essentials, Schneider Farese, Kimbrell, Woloszyk, Glencoe McGrawCopyright © Texas Education Agency (TEA)
3. The Segmenting the Market direction sheet.
Materials Needed:
1. Printer paper
2. Assignments and website information ready to distribute to students.
Segmenting the Market direction sheet
2. Computers with digital presentation software.
3. Internet for students to research business risks.
Equipment Needed:
1. Computer with digital presentation and Internet Access
2. Projector to Show Internet Sites
3. Computers for Students to Conduct Research
Learner Preparation:
If a company wanted to advertise during last year’s Super Bowl it would have cost them
around million for each 30 second commercial. To advertise during American Idol it
would cost a company over $500,000 for a 30 second spot. Marketing can be very
costly so marketers want to make sure that they are getting the most for their money
and reaching the people who are most likely to purchase their products. There are two
methods that marketers can use, one is to use a mass marketing approach, where you
have one message and broadcast it to as many people as you can. The other is to
target a specific set of customers who are most likely to purchase your product and
break down those customers in to specific segments. By segmenting the market you
can tailor your promotional efforts to reach that specific group of customers.
Introduction (LSI Quadrant I):
SHOW: Show students a website for a youth based apparel store (i.e. Hot Topic,
Zumiez, or deLiA*s)
SAY: These are some examples of some stores where you or your friends may shop.
ASK: Ask students if their parents purchase their clothes from these stores?
SAY: Explain that these stores have chosen to segment their market based on age and
ASK: Ask students how these stores might differ from a department store that carries a
wider range of clothing?
SAY: Explain that department stores are going for more of a mass marketing approach
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instead of segmenting a very specific target market.
ASK: Ask students if they think that these two type of stores will advertise on the same
radio, television or magazines?
SAY: Explain that if these youth oriented stores were to run ads in Good Housekeeping
Magazine or Golfers Digest Magazine the people who read their ads would probably not
be included to visit those stores so their advertising money would be wasted.
ASK: Ask students if they can think of some magazines or television shows that might
be better suited for these stores.
SAY: Explain that by targeting those customers who are most likely to visit their stores,
they are having a more effective advertising campaign and will not be wasting their
money. That is why it is important to understand who your customer is and segment
them into definable groups so you can zero in on their likes and dislikes.
Outline (LSI Quadrant II):
Instructors can use the digital presentation, slides, handouts, and note pages in
conjunction with the following outline.
I. Mass marketing is when marketers
attempt to appeal to an entire market with
one basic marketing strategy utilizing
mass distribution and mass media
Notes to Instructor
Use digital
presentation and
current events as
Mass marketing is
when marketers try
to reach the entire
market with one
appeal for everyone.
Depending upon the
product this can be a
difficult task.
Because of
differences in people
such as age, gender,
hobbies, lifestyles,
etc., people do not
watch or listen to the
same television
stations or read the
same magazines.
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The message also
may not be
appealing to
because the
population has
different preferences.
II. Market Segmentation is way of analyzing
a market by specific characteristics in
order to create a target market.
Use digital
presentation and
current events as
By breaking down
the market into
segments, marketers
are more likely to be
able to customize
their product to a
particular customer
and/or reach them by
means of advertising
and promotion.
Marketing Research
plays an important
role in understanding
who your customers
III. Demographics refer to statistics that
describe a population by personal
Use digital
presentation and
current events as
Demographics can
segment the market
by statistics such as
age, gender, income,
college education,
ethnic background,
or occupation. Once
marketers know the
demographics of
their target market,
they can categorize
and develop their
products to appeal to
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those individuals.
IV. Age
A. Baby Boomers – 76 million babies
born 1946-1964
1. Control 51% of wealth.
2. Spending power increases
as boomers get older.
3. Prime targets for luxuries
and recreational items.
4. Growing senior services and
healthcare fields
Use digital
presentation and
current events as
Baby boomers are
important because
they are the largest
segment of the U.S.
population and they
are aging. Because
of the aging baby
boomer population
there has been a
shift in age related
products. These are
also mostly or soon
to be empty nesters
with more disposable
income than younger
generations with
children still at home.
B. Generation X – 40 million babies
born 1965-1976
1. Dual-income households or
divorced parents
2. Tend to be savvy and
skeptical consumers, better
educated than previous
3. Prime targets of cosmetics,
fashionable clothing, movies,
Gen Xers are better
and electronic items
educated than
C. Generation Y – 77 million babies
previous generations
born 1977-1997
and are very
1. Growing up during computer skeptical of what
they see on
television. This was
2. Accustomed to interactivity
the first generation of
and multi-tasking.
latchkey kids who
3. Strive to be different from
had both parents
working. Gen Xers
4. Very comfortable with
are mostly still
computers and “surfing the
raising children and
have demands
5. Influence big ticket family
placed on their time
purchases and have
and budgets
spending power.
because of their
families. Gen-Xers
spend 78% more
than average on
personal services
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and are therefore
prime candidates for
these types of
Gen Y has grown up
with computers and
technology. They are
used to multi tasking
and are attracted to
a fast paced, quickly
changing advertising.
Gen Y is the largest
segment of the
population behind
the baby boomers.
Marketers need to
find unconventional
means to reach Gen
Yers. Because of
their comfort with
technology, they like
to fast forward
through commercials
on the DVR or
channel surf when
ads come on. To get
around this many
advertisers have
moved to product
placement or some
other form of
promotion to reach
Gen Y.
Use digital
presentation and
current events as
Gender is another
way to segment the
market. Men and
women watch
different TV shows,
read different
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magazines and have
different wants and
VI. Income
A. Disposable Income – Money left
after paying taxes.
B. Discretionary Income – Money left
after paying for basic living
necessities such as food, shelter,
and clothing.
C. Affluent; small percentage, but
account for half of all discretionary
spending in U.S.
VII. Ethnic Background – U.S. population
becoming more diverse.
A. Caucasian population declining
while other ethnic populations
B. By 2025, African-American,
Hispanic, and Asian-American
populations are expected to
represent 37.2% of all Americans.
C. To reach African-Americans,
marketers may use magazines
Copyright © Texas Education Agency (TEA)
Use digital
presentation as an
Disposable income is
money that you take
home in your
paycheck after taxes
are subtracted. But
bills still must be paid
with this money such
as house payments,
car notes and
utilities. Discretionary
income is money that
can be used once
the bills have been
paid. Affluent people
are the small
percentage of the
population that have
large discretionary
incomes, and they
account for half of all
consumers spending
in the U.S.
Use digital
presentation as an
Different ethnicities
have different
characteristics. Many
companies have
realized that by
embracing the
environment in the
U.S. today they can
increase their sales
such as Essence or Black
Enterprise. Marketers have
learned that they must backup
their promotional activities with
community support., such as
sponsoring Black History Month.
and improve their
bottom lines.
More Asian-Americans are college
graduates then other ethnic
groups and higher percentage
hold professional jobs.
have a higher
population of college
graduates than any
other segment.
There is no national
broadcast media for
Asian-Americans, so
marketers can use
less costly local
media to reach them.
Many firms in the
U.S. are creating
new and different
products for the
Marketers must understand that
African American
Hispanics are a very diverse group markets. BET and
and comprises 21 nations.
Essence magazine
are examples of
Approximately 70% of Hispanics
media outlets that
are Roman Catholic and the
are targeted primarily
culture centers around family.
to the African
Families tend to be larger than the American market.
average U.S. family. Food
marketers know that when they
Hispanic culture
sell products in Hispanic
usually has larger
neighborhoods the package sizes families and an
must be large.
emphasis on
families, so
Marketers should consider
marketers have
Spanish language television,
learned that when
radio, and magazines.
selling in Hispanic
neighborhoods, there
Asian-American population
is a need to have
represents about 4% of U.S.
larger packages to
suit the larger
Americans of Asian descent is the families. There may
also be extended
fastest growing and most affluent
families living
population group.
together with
grandparents living
Very diverse encompassing 16
with grandchildren
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VIII. Psychographics – studies of consumers
based on social and psychological
A. Shared common interests such as
golfing, fishing, cars, and sports.
B. Trends change based on
generations, such as healthy
eating and exercising trends have
increased in recent years.
C. Time is a commodity, people want
time saving products.
Geographics refers to segmentation
based on where people live.
A. Markets can be
B. Local – Dallas
C. Regional – Texas, Southwest
D. National – United States
E. Global – World
Copyright © Texas Education Agency (TEA)
Use digital
presentation as aid.
Psychographics are
a way of segmenting
the market based on
lifestyle or shared
interests. For
instance people who
love to cook, golfers,
or avid sports fans.
The trend now is
conscientiousness or
organic foods.
Trends will change
over time and
marketers needs to
recognize the
change in trends so
they can stay ahead
of the curve and
tailor their marketing
for those trends.
Use digital
presentation as an
segment the market
by where people live.
These refer to local,
regional, national, or
global markets.
Marketers study
where their
customers live so
they can which
media to use and
where to market their
products. There are
also cultural
differences between
different regions of
the U.S. and the U.S.
compared to other
parts of the world.
Use digital
presentation as aid.
X. Product Benefits is segmenting the
market by the consumers’ needs and
The last segment is
by product benefits.
A. Sports shoes based on people
People are looking
who jog, walk, play basketball, etc. for a specific benefit
such as diet foods or
B. Shampoo that makes your hair
shine or increases volume for oily, products. Sports
dry, or normal hair.
drinks that are
targeted at athletes
C. Foods that help you lose weight
wanting to be
replenished during a
workout would or
purchasing diet aids
to lose weight, would
be examples of
segmentation by
product benefits.
Marketers need to
emphasize their
benefit and find
means to advertise
that are tailored to
that specific market
IntraKinesth perso
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Guided Practice (LSI Quadrant III):
Students will work in small groups and choose a product that they think would appeal to
all age groups. They will create one advertisement that could be used as a mass
marketing campaign.
Using the information that was presented about the values and habits of the different
age groups, they will create an advertisement that would appeal to each of the age
groups for their chosen product. Remember, the age groups are Gen Y, Gen X, and
Baby Boomers. They may create their ads on poster board or use the computer to
create a digital presentation.
Each group will present their ads to the class and explain why they think the product
has mass appeal and how effective they think their mass marketing ad would be. They
will explain what they modified for each age group and if they feel the segmentations
are necessary for their product or a mass appeal would work just as well.
Independent Practice (LSI Quadrant III):
Nontraditional Market Segmentation (Team project, two to three students per team)
Using the list of products from the Nontraditional Market Segment document, either
assign a product to students or allow them to choose.
Students will then create an advertising campaign for the nontraditional segment. They
may NOT modify the product but must come up with new creative ways to use and
promote the product. They will create a poster for the advertisement. The poster must
also describe the nontraditional market segment. Which type of segmentation is it
based on, are age groups, interests, ethnicities, etc., involved in the segmentation?
Students may use the computers to research their products.
The posters will be presented to the class and graded on the attached rubric.
Review (LSI Quadrants I and IV):
Question: Why do markets want to segment their markets?
Question: Are all products well suited for market segmentation?
Question: How do baby boomers differ from gen Y?
Question: Would you use the same promotional methods to reach both generations?
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Question: How does the multicultural environment in the U.S. affect marketers?
Question: How might marketers take advantage of the multicultural market?
Question: Can marketers assume that all Hispanics or Asian-American’s are culturally
the same?
Question: How does age play a part in market segmentation?
Question: What is the difference between disposable and discretionary income?
Question: What is the effect of affluent people on the economy?
Question: If a person is look for tennis shoes to help them jump higher, what
segmentation can they be considered?
Informal Assessment (LSI Quadrant III):
Instructor should observe the work ethic of individuals involved in class discussions and
the Independent Practice activity.
Formal Assessment (LSI Quadrant III, IV):
Students will be evaluated on their Nontraditional Market Segmentation by using the
assigned rubric.
Extension/Enrichment (LSI Quadrant IV):
Marketing Segmentation
Students will write an essay that describes the purpose of using a target market instead
of a mass marketing approach. They will provide examples of products that are suited
for both types of approaches. Then they will discuss the importance of market
segmentation and describe each of the marketing segments giving examples of
products that might be targeted for each segment.
Copyright © Texas Education Agency (TEA)
Marketing Dynamics
Unit 2, Lesson 2 Student Directions
Independent Practice (LSI Quadrant III):
Nontraditional Market Segmentation (Team project, two to three students per team)
Baby food
Nontraditional Segment
College students
Denture fixative
New Parents
Coloring books
Business executives
Camera film
Golf bag
Football coaches
Video games
Senior citizens
Snow shovels
Jewelry boxes
Tennis racquet
Using the list of products above, describe the traditional market segment for the
product. Then create an advertising campaign for the nontraditional segment. You may
NOT modify the product but must come up with new creative ways to use and promote
the product. You will create a poster for the advertisement. Your poster must also
describe the nontraditional market segment. Which type of segmentation is it based on,
are age groups, interests, ethnicities, etc., involved in the segmentation?
The poster will be presented to the class.
Copyright © Texas Education Agency (TEA)
Independent Practice (LSI Quadrant III)
Nontraditional Marketing Segmentation Presentation and Collateral Materials
Well-rehearsed with
smooth delivery that
holds audience
Rehearsed with fairly
smooth delivery that
holds audience
attention most of the
Delivery not smooth, Delivery not smooth
but able to maintain and audience
interest of the
attention often lost.
audience most of the
Makes excellent use
of font, color,
graphics, effects,
etc. to enhance the
Makes good use of
font, color, graphics,
effects, etc., to
enhance the
Makes use of font,
color, graphics,
effects, etc., but
occasionally these
distract from the
Use of font, color,
graphics, effects etc.
but these often
distract from the
presentation content.
Covers topic indepth with details
and examples.
Subject knowledge
is excellent.
Includes essential
knowledge about the
topic. Subject
knowledge appears
to be good.
Includes essential
information about
the topic but there
are 1-2 factual
Content is minimal
OR there are several
factual errors.
Content is well
organized using
headings or bulleted
lists to group related
Uses headings or
bulleted lists but the
overall organization
of topics appears
Content is logically
organized for the
most part.
There was no clear
or logical
structure; just lots of
Product shows a
large amount of
original thought.
Ideas are creative
and inventive.
Product shows some
original thought.
Work shows new
ideas and insights.
Uses other people's
ideas (giving them
credit), but there is
little evidence of
original thinking.
Uses other people's
ideas, but does not
give them credit.
Total Points Earned _______
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