Segmentation Schemes
 Mutually exclusive - separate from all others
 Exhaustive - everyone must have an
appropriate group
 Measurable - size, purchasing power & profiles
must be measurable
 Substantial - each segment should have a
significant membership
 Actionable - can be reach through media
Benefits of segmentation
 Valuable insight into product/service design to
reflect market demand
 Gives direction to advertising messages
 Yields cost savings from accurate promotional
message placement
 Enables focusing on competition’s
strengths/weaknesses by reducing variables
 Fosters production of informed strategic
marketing plans
Determine target audience
1. Undifferentiated marketing – shotgun
2. Differentiated - targets multiple segments with
different incentive and message
3. Differentiated single segment
(“Niche marketing” targets small groups of specific audiences members.)
Demographic segments
Baby boomers - use benefit segments
Generation Y - diversity, high income,
computer literate
Teenagers - online sharing
Geodemographics - use of PRIZM lifestyle
segments by zip code
Millenials
Psychographic segments
Lifestyles, patterns of behavior
AIO (Activities, Interests, Opinions)
VALS (psychocentric, midcentric, near
allocentric, allocentric)
Cohort segments - grew up at the same time;
life stages
Global Lifestyle Segments
Teens
Gender
Religious
Symbolic capital – status
(Financial, Social, Cultural capital)
Ethnic
Generic segmentation factors
Usage - rate, occasion-based, loyalty status
(80/20 rule, RFM)
Price
Benefits
Segment
Benefit message
Teens
Tourist
Employees
socialize w/o parents
cultural exposure
chance to be outside
Aesthetic segmentation
Stimulation: thrilling, awesome
Realism: working class
Conventional sex identity: macho
Shapes of round and curved: visual stimulation
Social status orientation
Seriousness vs frivolity
Segmenting by action
Prosumers - consumers help design products,
reject traditional ads, use Internet research
 Professional
 Producer
+
Consumers
 Producing
 Proactive
Qualitative Approach
-Persona segmentation
Consumer models = personas or archetypes
Qualitative analysis of user behavior
Reveal motivations and potential usage
patterns
Niche Markets
Special interest groups
Immigrants and expatriates for homeland
news
Addresses needs and wants of special
segments with directed promotional
messages
Questions for discussion
 What is the value of cohort segmentation for
targeting mature consumers for a vacation
destination and why?
When would you use PRIZM vs. MOSIAC for
promotion purposes?
What new market segments may emerge for
future global audiences?