Market Segmentation (Group-8)

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BASES FOR MARKET

SEGMENTATION Group 8



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What is Market

Segmentation?Ø

Market segmentation involvesaggregating prospective buyers intogroups that have two key

characteristics.

o have common needs ando respond similarly to a marketing

action.

o It is the Consumer who are Segmented,



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Benefits of

Segmentation

Effective use of resources

Gain a focus

Create Value for a target market

Positioning



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Market SegmentationVariables

MarketSegmentati

onVariables

BehavioralPsychographic

Geographic

Demographic



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Geographic Segmentation• Geographic segmentation divides the market

into different geographical units, be theyneighbourhoods, cities, counties, countries, orworld regions such as Europe or South East

Asia etc.• Geographical segmentation is most commonly

used by multi-national and global businesses,who may alter their marketing mix based onthe differing needs of consumers in each

geographic segment they operate within.



Marketing for Hospitality and Tourism, 3e

©2003 Pearson Education, Inc.Philip Kotler, John Bowen, James Makens

Demographic Segmentation

Dividing the market into groupsbased on variables such as:

Age

Gender

Family size or life cycle Income

Occupation

Education

Religion Race

Generation

Nationality



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DemographicSegmentation

o Emami segmented its product in genderWomen’s: Naturally fair

Men: Fair and handsome



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Psychographic Segmentation

Divides Buyers Into Different Groups Basedon:



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Psychographic Segmentation

Example:

Café Coffee Day

They choose lifestyle oriented, urban consumers as targetwith youth.

They make coffee an ‘experience’ and provide a specialexperience to chosen segment. CCD has estimated thatpresently 60% of the footfalls in its 300 outlets belong tostudents between the ages of 15 to 24 years. The CCD are

targeting students and trying to establish a space in theirlives.



Marketing for Hospitality and Tourism, 3e

©2003 Pearson Education, Inc.Philip Kotler, John Bowen, James Makens

Behavioral Segmentation

Dividing the market into groups based onvariables such as:

Benefit sought: - Quality / economy / service / look etc.of the product.

Example: Nestle has found a separate segment attanoodles as distinct from the maida noodles.

Usage rate: - Heavy user / moderate user / light user of aproduct.

User status: - Regular / potential / first time user /

irregular /occasional. Loyalty to brand: - Hard core loyal / split loyal / shifting /

switches.

Occasion: - Holidays and occasion stimulate customer topurchase products.

Attitude toward offering: - Enthusiastic / positive



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• Size, purchasing power,profiles

of segments can bemeasured.

• Segments can beeffectively reached and served.

• Segments are large or

profitable enough to serve.

Me

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• Effective programs can bedesigned to attract and serve

the segments.

Requirements for

effective segmentation

Market Segmentation (Group-8)

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