1. MARKET SEGMENTATION

2. Market segment
The process of dividing a market into
distinct subsets of consumer with
common needs or characteristics and
selecting one or more segments to
target with a distinct marketing mix.

3. Need of segmentation
• Need, want and desire are not same.
• The primary advantage is cost
reduction.
• It avoids head on competition in the
market place.

4. How segmentation operates
• Segmentation studies are designed to
discover the needs and wants of
specific groups of consumer, so that
specialized goods and services can be
developed and promoted to satisfy each
groups needs.
• It is also used to guide the redesign,
the reposition, or extending the product
targeting to a new consumer segment.

5. Segmentation strategies
The first step in developing a
segmentation strategy is to select the
most appropriate base on which to
segment the market. Eight major
categories of consumer characteristics
provide the most popular bases for
market segmentation.
– Geographic factor
– Demographic factors
– Psychological characteristics

6. – Sociological variables
– Use related characteristics
– Use-situation factors
– Benefit sought
– Hybrid segmentation.

7. Geographic segmentation
In geographic segmentation, the market
is divided by location. The theory
behind this strategy is that people who
live in the same area share some similar
needs and wants and that these needs
and wants differ from those of people
living in other areas.

8. Demographic segmentation
Demographic characteristics, such as
age sex, marital status, income,
occupation and education are most often
used as the basis for market
segmentation. Demographics refers to
the vital and measurable statistics of a
population. Demographics help to locate
a target market.

9. Psychographic segmentation
Psychographic characteristics refers to
the inner qualities of the individual
consumer. Consumer segmentation
strategies are often based on specific
psychological variables.
1. need and motivation
2. personality
3. perception
4. attitude, etc.

10. Socio-cultural segmentation
Socio-cultural variables such as group
and culture, provide further bases for
market segmentation. For example,
consumer markets have been
successfully subdivided into segments
on the basis of stages in the family life-
cycle, social class, core culture values,
etc

11. Use related segmentation
An extremely popular and effective
form of segmentation categorizes
consumers in terms of product, service,
or brand usage characteristic, such as
usage rate, awareness status, and
degree of brand loyalty.

12. Usage-situation segmentation
Marketers recognize that the occasion
or situation often determines what
consumers will purchase or consume. For
this reason, they sometimes focus on
the usage situation as a segmentation
variable.

13. Benefit segmentation
Marketing and advertising executives
constantly attempt to isolate the one
particular benefit that they should
communicate to consumers. Changing
lifestyle plays a major role in
determining the product benefits that
are important to consumers and provide
marketers with opportunities for new
product and services.

14. Hybrid segmentation
Marketers commonly segment markets
by combining several segmentation
variables rather than relying on a
single segmentation base.
1. psychographic-demographic
2. geo-demographic
3. VALS 2

15. VALS II
VALS 2 is a marketing and consulting tool that
helps businesses worldwide develop and
execute more effective strategies. The
system identifies current and future
opportunities by segmenting the consumer
marketplace on the basis of the personality
traits that drive consumer behavior. VALS
applies in all phases of the marketing process,
from new-product development and entry-
stage targeting to communications strategy
and advertising.

17. Implementing segmentation
• Concentrated marketing
• Differentiated marketing
• Counter-segmentation

18. THANK YOU