MARKET SEGMENTA

TIONChhavi Jain

MASS MARKETING

Henry Ford was the first to mass-market automobiles. Ford mass-produced by assembly line, mass-distributed through dealers, mass-promoted one product for all buyers through just one ad.

MASS MARKETING

Mass m

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Larges

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Lower costs

Lower

prices

High margins

MASS MARKETING

Mass

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Mass audience

Mass

promotion

More

expensive

Create value for targeted customers

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Segmentation Differentiation

Positioning Targeting

Create value for targeted customers

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• Divide the total market into smaller segments

• Differentiate the market offering to create superior customer value

• Position the market offering in the minds of target customers

• Select the segment or segments to enter

Segmentation Differentiation

Positioning Targeting

Create value for targeted customers

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MICRO MARKETING

The practice of tailoring products and marketing programs to the needs and wants of specific individuals and local customer groups.

Rather than seeing a customer in every individual, micro-marketers see the individual in every customer.

Micro marketing

Segment marketing

Niches Local areas

Individuals

MARKET SEGMENTATION BENEFITS

Facilitates right choice of target market Facilitates effective tapping of the chosen market Makes the marketing effort more efficient and

economic Helps identify less satisfied segments and

concentrate on them

SEGMENT MARKETING

A market segment consists of a group of customers who share a similar set of NEEDS and WANTS.

Car buyer- low cost basic transportation; luxurious driving experience; adventurous driving

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MAYBACH EXELERO 80,00,000$

SEGMENT MARKETING

It offers key benefits over mass marketing.Company can Better design, Price, Disclose

and Deliver the product/ service to target market

SEGMENT MARKETING

A flexible market offering consists of two parts:

A naked solution: product/ service elements that all segment members value.

Discretionary options: some segment members value.

SEGMENT MARKETING

Car basic model, power steering, power window, petrol diesel versions

Train sleeper, 3ac 2ac 1ac

Airline business class, economy class, executive class

SEGMENT MARKETING

Homogenous preferences- all the consumers have roughly the same preferences.

Diffused preferences- consumer preferences may be scattered throughout the space.

Clustered preferences- market may reveal distinct preference clusters.

NICHE MARKETING

A niche is a more narrowly defined customer group seeking a distinctive mix of benefits.

Product

LOCAL MARKETING

Marketing programmes related to the needs and wants of local customer groups (trading areas, neighbourhoods, individual stores).

CUSTOMERISATION/ INDIVIDUAL MARKETING

It combines operationally driven mass customisation with customised marketing in a way that empowers consumers to design the product and service offering of their choice.

A company is customerised when it is able to respond to individual customers by customising its products, services and messages on a one-to-one basis.

Segmenting Consumer Markets

GEOGRAPHIC SEGMENTATION

CountriesCulturesUrban v/s Rural

THAILAND- Burgers with Thai Basil JAPAN- Teriyaki Burger INDONESIA- Rice Dishes INDIA- Mc Aloo Burger, Veg Salad Sandwich, Mc Masala, Mc

Imli Sauces, Garlic free sauces, Eggless sandwich sauces, Veg Pizza Mcpuff,

India 75% localised menu, 33% in Asian Countries, other countries less than 5%

DEMOGRAPHICS

Gender Age Education Income

Pantaloon, Carrefour, Shopper’s Stop target the high income group as compared to Vishal Retail, Reliance Retail or Big Bazaar who cater to the individuals belonging to the middle income segment.

Marital Status Market segmentation can also be as per the

marital status of the individuals. Travel agencies would not have similar holiday packages for bachelors and married couples.

Occupation Office goers would have different needs as

compared to school / college students. A beach house shirt or a funky T Shirt

would have no takers in a Zodiac Store as it caters specifically to the professionals

Gillette- Razors for male and Gillette Venus for female

PSYCHOGRAPHICS

It is the science of using psychology and demographics to better understand consumers.

People within the same demographic group can exhibit very different psychographic profiles.

PSYCHOGRAPHIC

Lifestyle-Activities, interest, opinion Culture oriented, sports oriented, outdoor

oriented

Personality- compulsive, gregarious, authoritarian, ambitious

PSYCHOLOGICAL Attitude

Knowledge and awareness

Wants and needs

Affiliations

Traits- extrovert/ introvert

Expertise and involvement- hobbies

Brand attributes sought- premium quality/ low price

Risk orientation- financial investments, adventure travel

PSYCHOGRAPHIC

A popular tool for segmenting use of psychographic data is called VALS.

VALS

Believers Strivers Makers

Survivors

HIGH RESOURCESHIGH INNOVATION

LOW RESOURCESLOW INNOVATION

INNOVATORS

IDEALS ACHIEVEMENTSELF-

EXPRESSION

PRIMARY MOTIVATION

VALS Innovators- sophisticated, high self esteem, image is important

Thinkers- conservative, practical, look for value

Achievers- goal oriented lifestyle, image very important

Experiencers- like ‘cool stuff’, high expenditure on fashion

Believers- conservative, like familiar and established brands

Strivers-trendy and fun loving, money defines success, concerned about other’s opinions

Makers- practical, DIY, prefer value to luxury, unimpressed by material possessions

Survivors – few resources, buy at discount, little motivation to buy, loyalty high

BEHAVIOURAL Users v/s competitors’ users v/s non-users of brand/

category

Co purchase patterns- recommendation agents and similar purchases

Media- magazines, cable, internet, movies

Loyalty programmes, purchase frequency

Occasions, benefits, usage rate, buyer-readiness stage,

Psychographic segmentation The basis of such segmentation is the lifestyle of the individuals. The individual’s attitude,

interest, value help the marketers to classify them into small groups. Behaviouralistic Segmentation The loyalties of the customers towards a particular brand help the marketers to classify

them into smaller groups, each group comprising of individuals loyal towards a particular brand.

Geographic Segmentation Geographic segmentation refers to the classification of market into various geographical

areas. A marketer can’t have similar strategies for individuals living at different places. Nestle promotes Nescafe all through the year in cold states of the country as compared to

places which have well defined summer and winter season. McDonald’s in India does not sell beef products as it is strictly against the religious beliefs

of the countrymen, whereas McDonald’s in US freely sells and promotes beef products.