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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.
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Market Strategies Sunny, Chris, Zekeand 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.
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.
