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3 - 2Chapter Outline• What Is Market Segmentation?• Bases for Segmentation• Criteria for Effective Targeting ofSegments• Implementing Segmentation Strategies
3 - 3Market SegmentationThe process of dividing apotential market intodistinct subsets ofconsumers and selectingone or more segments asa target market to bereached with a distinctmarketing mix.
3 - 4Three Phases of MarketingStrategyPhase 2Target Market and Marketing Mix SelectionPhase 3Product/Brand PositioningPhase 1Market Segmentation
3 - 5Segmentation Studies• Discover the needs and wants ofgroups of consumers to developspecialized products to satisfy groupneeds• Used to identify the most appropriatemedia for advertising
3 - 6Ryka producessneakers thatmeet the specialneeds ofwomen’s feet.
3 - 7Discussion Question• Considering the largest bank in yourcollege’s city or town:– How might consumers’ needs differ?– What types of products might meet theirneeds?– What advertising media makes sense forthe different segments of consumers?
3 - 16Two High-End Watches for DifferentPsychological Segments
3 - 17Psychographic Segmentation• Also known as Lifestyle Analysis• Psychographic variables includeattitudes, interests, and opinions(AIOs)
3 - 18Instructions: Please read each statement and place an “x” in the box that best indicates howstrongly you “agree” or “disagree” with the statement.I feel that my life is moving faster and faster,sometimes just too fast.If I could consider the “pluses” and “minuses,”technology has been good for me.I find that I have to pull myself away from e-mail.Given my lifestyle, I have more of a shortage oftime than money.I like the benefits of the Internet, but I often don’thave the time to take advantage of them.                              AgreeCompletelyDisagreeCompletelyTable 3.6 Excerpts from AIO Inventory
3 - 19weblinkOpinionsand AttitudesADBUSTERSWeb site istargeted toconsumerswith a certainattitude towardadvertisers
3 - 20Sociocultural Segmentation• Family Life Cycle• Social Class• Culture, Subculture, and Cross-Culture
3 - 23Discussion Questions• What types of marketers mightsegment according to social class?• What ethical issues might marketershave when marketing to different socialclasses?
3 - 24Use-Related Segmentation• Rate of Usage– Heavy vs. Light• Awareness Status– Aware vs. Unaware• Brand Loyalty– Brand Loyal vs. Brand Switchers
3 - 25HighLowConsumptionHigh LowLoLows(starve)HiHighs(stroke)LowHighs(chase)HiLows(tickle)Segmenting Customers by UsageTable 3-8Current Share
3 - 26Usage-Situation Segmentation• Segmenting on the basis of specialoccasions or situations• Example Statements:– Whenever our daughter Jamie gets a raise,we always take her out to dinner.– When I’m away on business, I try to stay ata suites hotel.– I always buy my wife flowers onValentine’s Day.
3 - 27Benefit SegmentationSegmenting on the basis of the mostimportant and meaningful benefit
3 - 31Selected Lifestyle Profile of USA TodayExcerpt from Table 3-11%CompIndexTech Savvy ReadersUse Internet more than once a day 32% 174Internet access at home 79% 128Online purchase for business or personal use in past30 days40% 182Household owns a PC 84% 119Owns digital camera 22% 130Leisure ActivitiesAttended movies in last 6 months 73% 120Bought music CD/tapes in last 12 months 46% 126Book reading 45% 120Entertain friends or relatives at home in last 12 months 48% 123Household subscribes to cable 69% 112
3 - 33Discussion Question• How would you classifyyourself according toVALS? Your parents?• Do you think thisrepresents you as aconsumer?• If so, for what productsdoes this fit you as aconsumer?• Copy down the URLbelow to take the VALSsurvey tonight. See if youwere right in yourclassification…http://www.sric-bi.com/VALS/presurvey.shtmlweblink