WITHIN A

MARKET EACH
CONSUMER IS
DIFFERENT

MARKET SEGMENTATION
SEGMENTATION IS THE PROCESS OF
DIVIDING THE TOTAL MARKET INTO
VARIOUS SEGMENTS ON THE BASIS OF
SOME COMMON CHARACTERSTICS SUCH
AS SEX,AGE,EDUCATION,PROFESSION ETC.
A MARKET SEGMENT CONSISTS OF
CUSTOMERS WHO SHARE A SIMILAR OR
HOMOGENEOUS SET OF WANTS.

ACCORDING TO AMERICAN
MARKETING ASSOCIATION
MARKET SEGMENTATION REFERS TO
DIVIDING THE HETROGENEOUS
MARKETS INTO SMALLER
CUSTOMER GROUPS HAVING
CERTAIN HOMOGENEOUS
CHARACTERISTICS THAT CAN BE
SATISFIED BY THE FIRM

MARKET SEGMENTATION
DEFINITION
Grouping people according to their
similarity related to a particular
product category

OBJECTIVES OF MARKET
SEGMENTATION
1.To make group of customers on the basis of their
homogenous characteristics.
2.To make the activities of firm consumer-oriented.
3.To determine the differences among customers.
4.Identify the area where the customers may be
created and market area can be expanded.
5.To identify the needs ,tastes and buying motives of
target consumer.

Levels of Market Segmentation

Mass
Mass Marketing
Marketing
Same
Same product
product to
to all
all consumers
consumers
(no
(no segmentation)
segmentation)
Segment
Segment Marketing
Marketing
Different
Different products
products to
to one
one or
or more
more segments
segments
(some
(some segmentation)
segmentation)
Niche
Niche Marketing
Marketing
Different
Different products
products to
to subgroups
subgroups within
within segments
segments
(more
(more segmentation)
segmentation)
Micromarketing
Micromarketing
Products
Products to
to suit
suit the
the tastes
tastes of
of individuals
individuals and
and locations
locations
(complete
(complete segmentation)
segmentation)
Local Marketing

Individual Marketing

Tailoring brands/ promotions

to local customer groups

Tailoring products/ programs

to individual customers

MASS MARKETING
Mass Marketing:
The Seller engages in
1. Mass marketing>mass production>mass
distribution>and mass promotion
ONE PRODUCT FOR ALL BUYERS.
It creates the largest potential market>leads to
lower costs>lower prices>higher margins

SEGMENT MARKETING
Marketing to a group of customers who share a
similar set of wants. Market segment can be done
in three different ways: Homogeneous preferences
Diffused preferences
Clustered preferences

(a) Homogeneous
preferences

(b) Diffused
preferences

(c) Clustered
preferences

NICHE MARKETING
NICHE MARKETING FOCUSES ON SUB
GROUPS WITHIN THE SEGMENTS. A NICHE
IS A MORE NARROWLY DEFINED GROUP,
USUALLY IDENTIFIED BY DIVIDING A
SEGMENT INTO SUB SEGMENTS OR BY
DEFINING A GROUP WITH THE
DISTINCTIVE SET OF TRAITS THAT MAY
SEEK A SPECIAL COMBINATION OF
BENEFITS.
IT IS A SEGMEN NOT BEING SERVED
PRESENTLY.
THUS, IT COULD BE A PROFITABLE SEGMENT
TO ENTER.

LOCAL MARKETING
LOCAL MARKETING INVOLVES TAILORING
BRANDS AND PROMOTIONS TO THE NEEDS
AND WANTS OF LOCAL CUSTOMER
GROUPS CITIES NEIGHBOURHOODS AND
EVEN SPECIFIC STORES.

INDIVIDUAL CUSTOMER
MARKETING
INDIVIDUAL MARKETING INVOLVES
TAILORING BRANDS AND PROMOTIONS TO
THE NEEDS AND PREFERRENCES OF
INDIVIDUAL CUSTOMERS.
IT IS A VERY CUSTOMISED STRATEGY OF
MARKETING.

SEGMENTING CONSUMER
MARKETS
A MARKETER HAS TO TRY DIFFERENT
SEGMENTATION VARIABLES, ALONE AND
IN COMBINATION, TO FIND THE BEST WAY
TO VIEW THE MARKET STRUCTURE. THE
CONSUMER MARKET CAN BE SEGMENTED
ON THE BASIS OF CONSUMER
CHARACTERISTICS LIKE GEOGRAPHIC,
DEMOGRAPHIC AND PSYCHOLOGICAL.

Bases for Segmenting

Consumer Markets
Geographic
Region, City or Metro
Size, Density, Climate

Demographic
Age, Gender, Family size
and life cycle,
Occupation, or Income ...

Psychographic
Lifestyle or Personality

Behavioral
Occasions, Benefits,
Uses, or Attitudes

Geographic segmentation
Region
city
Climate
Population

Demographic segmentation
Dividing the market into groups based on variables such as:
Age
Gender
Family size or life cycle
Income
Occupation
Education
Religion
Race
Generation
Nationality

Psychographic segmentation
Life style
Personality

Behavioral segmentation
Dividing the market into groups based on
variables such as:
Occasions
Benefits
User status
Usage rate
Loyalty status
Readiness stage
Attitude toward product

SEGMENTING BUSINESS
MARKETS
BUSINESS BUYERS CAN BE
SEGMENTED
GEOGRAPHICALLY,
DEMOGRAPHICALLY OR BY BENEFITS
SOUGHT, USER STATUS, USAGE RATE AND
LOYALTY STATUS. YET BUSSINESS
MARKETERS ALSO USE SOME ADDITIONAL
VARIABLES SUCH AS CUSTOMER OPERATING
CHARACTERISTICS, PURCHASING
APPROACHES, SITUATIONAL FACTORS AND
PERSONAL CHARACTERISTICS.

Bases for Segmenting Business

Markets
Personal
Characteristics

Situational
Factors

Demographics

Bases
Bases
for
for Segmenting
Segmenting
Business
Business
Markets
Markets

Purchasing
Approaches

Operating
Characteristics

SEGMENTING INTERNATIONAL MARKETS

SEGMENTING INTERNATIONAL
MARKETS
COMPANIES CAN SEGMENT
INTERNATIONAL MARKETS USING
ONE OR A COMBINATION OF
SEVERAL VARIABLES. THEY CAN
SEGMENT BY GEOGRAPHIC
LOCATION GROUPING COUNTRIES
BY REGIONS SUCH AS WESTERN
EUROPE, THE PACIFIC RIM, THE
MIDDLE EAST OR AFRICA.

REQUIREMENTS FOR SUCCESSFUL

SEGMENTATION
HOMOGENEITY WITHIN THE SEGMENT.
HETEROGENEITY BETWEEN SEGMENTS.
SEGMENTS ARE MEASURABLE AND
IDENTIFIABLE.
ACCESSIBLE AND ACTIONABLE.
SEGMENT IS LARGE ENOUGH TO BE
PROFITABLE.

ADVANTAGES OF MARKET
SEGMENTATION
1. KNOWLEDGE OF MARKETING OPPORTUNITIES.
2. ADOPTING EFFECTIVE MARKETING PROGRAMME.
3. PROPER ALLOCATION OF RESOURCES.
4. BETTER ASSESSMENT OF THE COMPETITION.
5. ADJUSTMENT IN PRODUCTS.
6. KNOWLEDGE OF CUSTOMERS NEEDS.
7. INCREASE IN SALES VOLUME.
8. EFFECTIVE ADVERTISING APPEALS.
9. ENHANCES MARKETING EFFICIENCY .
10. BENEFITS TO CONSUMERS.