Market Segmentation

1. MARKET SEGMENTATION

2. WHAT IS MARKET SEGMENTATION?
 Market segmentation involves dividing a large homogenous market of potential customers into clearly
identifiable segments. Customers are divided based on meeting certain criteria or having similar
characteristics that lead to them having the same product needs. Segments are made up of customers
who will respond similarly to marketing strategies. They share common interests, needs, wants and
demands.

3. IMPORTANCE OF MARKET SEGMENTATION
▪ Market segmentation it makes planning campaigns easier,
▪ It helps to focus the company on certain customer groups instead of targeting the mass market.
▪ Segmentation helps marketers to be more efficient in terms of time, money and other resources.
▪ Market segmentation allows companies to learn about their customers.

4. REQUIREMENTS OF MARKET SEGMENTS
 Measurable: The differentiating attributes of the segments must be measurable so they can be
identified.
 Substantial: The segments should be sufficiently large to justify the resources required to target
them.
 Accessible: The segments must reachable through communication and distribution channels.
 Differentiable: People or Organization in a segment should have similar needs that are clearly
different from the needs of other people in other segments.
 Actionable: Attract and serve the customers, through efficient and cost effective way.
 Stable: In order for a marketing effort to be successful, a segment should be stable enough for a
long period of time to be marketed strategically.

5. TYPES OF MARKET SEGMENTATION
Demographic segmentation
 This is the most common type of segmentation. A target audience is divided based on qualities such as,
age, gender, occupation, education, income and nationality.
Behavioral segmentation
 A company can segment their market based on consumer’s behaviors. By dividing your target audience
based on their behaviors allows you to create specific messaging that will accommodate to those
behaviors.

6. Geographic segmentation
 This involves splitting up a market based on location. Even though this is a basic form of
segmentation it is highly effective. By knowing where a customer is located can help a company
better understand the needs of their customers and companies can then target customers with
location-specific ads.
Psychographic segmentation
 This form of segmentation is very similar to demographic segmentation however, it deals with
characteristics that are related to mental and emotional attributes. Psychographic segmentation
divides a group of customers based on their personality traits, values, interests, attitudes and
lifestyles. Demographics as we discussed earlier are much easier to observe than psychographics,
however, psychographics give marketers valuable insights into customers motives, preferences
and needs. By understanding psychographics, marketers can develop content that is more relatable
to their customer segments.

7. COMBINING MARKET SEGMENTATIONS
Combining market segmentations
 Brands may choose to combine two or more of the four outlined market segmentations. Generational
marketing is one example. Brands that target the millennial generation use two segments:
• Demographic: people born between 1981 and 1996; and
• Psychographic: people with a shared set of expectations about the workplace, political views,
aspirations, etc.
 Although a person born between 1981 and 1996 is defined as a millennial, brands might refine their
segment by combining age with psychographic attributes. After all, 100% of millennials do not share
the same views or values. The right segment might be people in the millennial age range that share a
common set of psychographic attributes.

8. BENEFITS OF MARKET SEGMENTATION
 Higher Rate of Success
 Increases Profitability
 Increases Competitiveness
 Retention of Customer
 Creates and Provides Market Opportunities
 Effective Market Campaigning
 Wise and Efficient Use of Resources
 Higher Customer Satisfaction
 Cost-Efficient
 Know your Customer Better

9. LIMITATIONS
 Lack of information and data: Some markets are poorly researched with little information abut what
customers want.
 Difficulty in measuring and predicting consumer behavior: We humans do not have similar orientation
and likings all the time.
 Hard to reach customer segments once identified: It is one thing spotting a segment, it is another
reaching target customers with an effective marketing message.

10. CASE STUDY
 Fashion Channel: Market Segmentation ( Brief Case)
The new SeniorVice President of Marketing forThe FASHION Channel (TFC), a cable television network dedicated
to round-the-check, fashion oriented programming, is preparing to recommend a change in segmentation program.
This program is, in part, a response to the intensifying competitive environment forTFC, and it needs to strengthen
the company’s brand and positioning with viewers and advertisers. Consumer research provides insights but does not
give a simple answer regarding the best path to take.

11. NIRMA
 Shri Karsanbhai Patel is typical example of Indian entrepreneurship face of stiff competition. Starting
as one man operation in 1969, the brand is today industries third best brand as per ORG MARG survey.
Nirma’ strategy has always been to provide the consumer with “ Value for Money” option.

12. ▪ HTTPS://YOUTU.BE/N_HT50CJQNE
HTTPS://YOUTU.BE/OOSXGNHOVAA
HTTPS://YOUTU.BE/-Z-RWTVCKKI

13. THANKYOU : )