MARKET SEGMENTATION Identify and profile distinct group of buyers who might require separate products and/or marketing mixes. Market segmentation can be segmented in different ways. MASS MARKETING- is when the seller engages in the mass production, mass distribution and mass promotion of one product for all buyers it is also create s the largest potential market which leads to the lowest costs, which in turn can translate into either lower prices or higher margins. LEVELS OF SEGMENTATION
Four Levels of Level of Segmentation: 1. SEGMENT MARKETING- It consists of a large identifiable group within a market. 2. NICHE MARKEITNG- It is more narrowly defined group, typically a small market whose needs are not being well served by identifying niches, marketers dividing segment into sub segments or by defining a group with a distinctive set of traits who may seek combination of benefits. 3. LOCAL MARKEITNG- Marketing programs being tailored to the needs and wants of local customer groups. 4.
Market Segmentation Essay Example
INDIVIDUAL MARKETING- The ultimate segmentation leads to “segments of one “, customized marketing” or “one to one” FORM OF INDIVIDUAL MARKETING * SELF MARKETING- is a form of individual marketing in which the individual consumer takes on more responsibility for determining which products and brands to buy. PATTERNS OF MARKET SEGMENTATION Three (3) different patterns that can be emerge: 1. Homogeneous Preferences- shows a market where all the consumers have roughly the same preference. 2. Diffused Preferences- showing that the consumers vary greatly in their preferences. . Clustered Preferences- market might reveal distinct preference clusters called natural market segment. MARKET SEGMENTATION PROCEDURE Three (3) step approach used by marketing research firms. 1. Survey stage- the researcher conducts exploration interviews and focus groups to gain insight into consumer motivations, attitudes and behavior. 2. Analysis Stage- researcher analyzes and clusters the respondents into a specified number of maximally different segments. 3. Profiling stage- Each segment can be given a name based on a dominant distinguishing characteristic.
Market Partitioning investigate the hierarchy of attributes that consumers examine in choosing a brand. * Brand Dominant Hierarchy * Nation Dominant Hierarchy BASES FOR SEGMENTING CONSUMER MARKETS 1. Consumer Characteristics- commonly use geographic, demographic and psychographic characteristics. 2. Consumer Responses- looking for benefits sought, use occasions, or brands. MAJOR SEGMENTATION VARIABLES 1. GEOGRAPHIC SEGMENTATION- dividing the market into different geographical units such as nations, states, provinces, cities or neighborhoods. 2.
DEMOGRAPHIC SEGMENTATION- consists of dividing the market into groups on the basis of demographic variables such as age, generation, family size, family type, family cycle, gender, income, occupation, education, religion, race and nationality. Demographic Variables * Age and Life cycle Stage * Family Type * Gender * Income * Religion * Social Class 4. PSYCHOGRAPHIC SEGMENTATION- buyers are divided into different groups on the basis of lifestyle and personality. * Lifestyle * Personality 5. BEHAVIORAL SEGMENATTION- buyers are divided into group on the basis of their knowledge of, attitude toward, use of, response to a product. Occasions * Benefits * User status * Usage rate * Loyalty status * Hardcore Loyal- Consumers who buy one brand all the time. * Split Loyal- Consumers who are loyal to two or three brands all the time. * Switchers- Consumers who show no loyalty to any brand. FOUR KINDS OF PRODUCT USERS 1. Nonusers- may be aware of a product but have rejected it. 2. Loyal customers- are already using and loyal to the product. 3. Switchers- base their purchase decisions on such factors as price or variety seeking. 4. Emergent Consumers- are entering the market for the first time and may be the most valuable group. segmente