MARKET SEGMENTATION
Chapter 3
DEFINED
Process of dividing a market into distinct
subsets of consumers with common needs or
characteristics…takes advantage of market
diversity
MARKET TARGETING
Selecting one or more segments with a distinct
marketing mix…differentiate offerings, on
price, styling, packaging, promotional appeal,
method of distribution and superior service
POSITIONING
Place product in consumers mind so that it is
perceived by them in each target segment as
satisfying their needs better than other
competitive offerings
USE OF MARKET SEGMENTATION
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To target markets
Auto manufacturers
Food service companies
Retailers’
Hotels
Industrial firms’
Not-for-profit
Media
Suzuki/Ferrari
Fast food/BBQ Tonight
Gap/Ideas
Marriott
Siemens/ICI
IBA/Shaukat Khanum
Geo news/Geo Sports
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To fill product gaps
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To identify most appropriate media in which to place advertisements
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To discover needs and wants
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To guide the redesign or repositioning of a product or addition of new market segment
BASES FOR SEGMENTATION
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Geographic
Region, city size, density of area, climate
Demographic
Age, sex, marital status, income, education
Psychological
Motivation, personality, perception, learning
Psychographic
Lifestyles, AIO
Socio cultural
Cultures, sub, religion, social class, FLC
Use - related
Usage rate, awareness status, brand loyalty
Usage – situation
Time, objective, location, person
Benefit
Convenience, social acceptance, economy, value
Hybrid
Geo demographics
CRITERIA FOR EFFECTIVE TARGETING OF
MARKET SEGMENTS
 Identifiable
Recognizable e.g. age vs. lifestyle, attitude
 Sufficient
Size, number of segment population
 Stable
Permanent, lasting…adult vs. teenager
 Accessible
Easy to reach e.g. media
IMPLEMENTATION OF SEGMENTATION
STRATEGIES
• Differentiated
several segments
mix
• Concentrated
one segment
unique
• Counter segmentation
combine few common characteristics