Principles of Marketing
SESSION:16-19
1
Market Segmentation
Market Segment: is a portion of a larger market in which
the individuals, groups, or organisations share one or more
characteristics that cause them to have relatively similar
product needs
A market segment consists of a group of customers
who share a similar set of needs and wants.
Market Segmentation: Market Segmentation is the
process of dividing the total heterogeneous market into
relatively homogenous sub-groups of consumers with common
needs or characteristics and selecting one or more segments to
target with distinct marketing programme
2
Market Segmentation
Need For Segmentation
•
Needs and wants are heterogeneous
•
Consumers differ by age, sex, income, attitude, lifestyle
•
Segmentations helps marketers to select target market and
develop distinct marketing program
•
Segmentation also helps the marketer to redesign, reposition
and to target new segments for existing product
3
Market Segmentation
Categories of Segmentation: Segmentation falls under
1.
the following categories
Geographic Segmentation
2.
Demographic segmentation
3.
Psychographics segmentation
4.
Behaviouristic segmentation
4
Market Segmentation
1.
Geographic segmentation:
•
Segmenting on the basis of geographic location
•
Geographic units may be continents, Nations, Region, state, city,
town, area etc
•
Assumption is that people who belong to a certain geographic
location share homogenous needs
•
People in north India have homogenous food habits than the people
in south India
•
Hotel chains offering different menus according to the location they
are present in
5
Market Segmentation
2.
Demographic segmentation:
•
Segmentation on the basis of demography
•
Demographic characteristic such as age, sex, education, income,
marital status, family size, social class etc are used to segment
•
Toy manufacturers segment on the basis of the age of children
•
Bicycle manufacturers segment mainly on the basis of the school
goers, auto on the basis of income
6
Market Segmentation
3.
Psychographics segmentations
•
Segmentations on the basis of personality or lifestyle
•
Characteristics of personality – confident, aggressive,
conservative, modern, extrovert, introvert etc
•
What people do in their spare time is a good indicator of
lifestyle – two lifestyle segments that were most likely to drink
and drive 1. Good Timers – partygoers
2. Problem Kids – display troublesome behaviour
7
Market Segmentation

Lifestyle of Indian women – are home focused, less likely to
visit restaurant, more price sensitive, spend time preparing
meals at home and fond of movies

Lifestyle of adult students --- ……… ?
8
Market Segmentation
4.
Behaviouristic segmentation:
•
Segmentation on the basis of use occasion, user status, user
rate, loyalty status, buyer readiness stage and attitude
•
Use occasion of greeting cards are different. User status
could be non-users, potential users or first time users
•
User rate can be light, medium or heavy users
9
Market Segmentation
Buyer-Readiness Stage






Aware
Ever tried
Recent trial
Occasional user
Regular user
Most often used
10
Market Segmentation
Loyalty Status




Hard-core
Split loyals
Shifting loyals
Switchers
11
Market Segmentation
Effective Segmentation Criteria





Measurable
Substantial
Accessible
Differentiable
Actionable
12
Market Segmentation
4.
Behaviouristic segmentation:
•
Segmentation on the basis of use occasion, user status, user
rate, loyalty status, buyer readiness stage and attitude
•
Use occasion of greeting cards are different. User status
could be non-users, potential users or first time users
•
User rate can be light, medium or heavy users
13
Four levels of Micromarketing




Segments
Niches
Local areas
Individuals
14