Market Strategies
Sunny, Chris, Zeke and Genta
Segmenting Consumer Markets
A segmentation variable is the characteristics of individuals or
groups that are used by marketing managers to divide a total
market into segments.
Market Segmentation –
Demographic
• Demographic segmentation is the process of dividing the total
market according to particular features of a population.
• Coca-Cola, for example, targets 15- to 35-year-old males with
the energy drink “Mother”. The more health conscious adult
market is served with Diet Coke, Deep Springs Natural Mineral
Water or Nestea Iced Tea. Fanta has as its primary target
market 13- to 16-year-old teenagers.
Market Segmentation –
Geographic
• Geographic segmentation is the process of dividing the total
market according to geographic locations. Businesses may
divide the consumer market into regions because consumers
in different geographical locations have different needs, tastes
and preferences.
• Sometimes the city size can be an important segmentation
variable. One franchise fast-food business will not locate in
cities of less than 25000 people.
Market Segmentation –
Psychographic
• Psychographic segmentation is the process of dividing the total
market according to personality characteristics, motives, opinions,
socioeconomic group and lifestyles.
• Psychographic variables focus on why people behave the way they
do. E.g. An average Toyota Corolla owner compared with an average
Porsche Cayman S owner, for example, will respond quite differently
about the cost of vehicle maintenance, insurance and accessories.
Market Segmentation –
Behaviorual
• Behavioural Segmentation is the process of dividing the total
market according to the customers' relationship to the
product.
• A total market, for example, may be divided into users and
non users. Users can then be classified as heavy, moderate or
light. To encourage light and moderate users to purchase more
of its products, a business may have to redesign the product,
set special prices and implement special promotion activities.
People Processes and Physical
Evidence
Development of
Customer orientation +
service industies
Three news 'Ps' of
marketing which deal
with service's more
directly
People
People
Example
Refers to the quality of interaction between
the customer and those within the business
who deliver the service
Scandanavian Airline Service
Customers base their perceptions,
judgements about a business based how
employees treat them
First 15 seconds of service, known as the
'moment of truth' is key. Hostesses must
treat passengers well and fast.
Processes
Processes
Example
The flow of activites that a business will flow in
its delivery of a service
Airlines
Need to be highly effiecent.
Use website to enter details, confirmation
email, electronic boarding pass to be printed,
day prior tho flight seat allocation to be done.
Physical Evidence
• Physical evidence refers to the environment in which the
service will be delivered.
• It also includes materials needed to carry out the service such
as signage, brochures, calling cards, letterheads, business logo
and website.
• This is a tangible good and there is usually no samples.
• First time customers must buy on trust.
Question 1
• Describe TWO variables of market segmentation.
• Demographic segmentation: the process of dividing the total
market according to particular features of the population, including
size, age, income, cultural background and family size.
• Geographic segmentation: is the process of dividing the total market
according to geographic locations, eg: urban, rural, tropical, cold.
• Psychographic segmentation: the process of dividing the total
market according to personality characteristics, motives, opinions,
socioeconomic group and lifestyles.
• Behavioral segmentation: the process of dividing the total market
according to the customers' relationship to the product. Eg:
knowledge of, use of or benefits sought of a particular product.
Question 2