Basics about Marketing Strategies

1. MARKET
SEGMENTATION

2. INTRODUCTION TO MARKET SEGMENTATION
• Definition: Market segmentation is the process of dividing
a heterogeneous market into smaller, more manageable
segments based on shared characteristics.
• It allows businesses to tailor their marketing efforts to
specific groups of customers.

3. WHY DO WE NEED MARKET SEGMENTATION?
• Addressing Heterogeneity: Markets are diverse, and
customers have varied needs and preferences.
• Targeted Marketing: Segmentation enables businesses to
target specific customer groups with customized
marketing strategies.
• Enhanced Efficiency: It leads to efficient resource
allocation by focusing efforts where they are most
effective.

4. BENEFITS OF MARKET SEGMENTATION
• Enhanced Customer Understanding: Deeper insights into
customer needs and behaviors.
• Customized Marketing: Tailoring marketing efforts to specific
segments.
• Improved Resource Allocation: Efficient use of resources.
• Competitive Advantage: Ability to meet customer demands
more effectively.

5. BASES FOR MARKET SEGMENTATION
• Definition: Bases for market segmentation are the criteria
or variables used to divide a heterogeneous market into
smaller, more homogenous segments.
• These bases help businesses identify and target specific
customer groups with tailored marketing strategies.

6. DEMOGRAPHIC SEGMENTATION
• Explanation: Dividing the market based on demographic
factors, which include characteristics like age, gender,
income, education, marital status, and family size.
• Example: Targeting luxury products to high-income
individuals or baby products to new parents.

7. GEOGRAPHIC SEGMENTATION
• Explanation: Segmenting the market
based on geographic location, such
as country, region, city, climate, or
urban/rural areas.
• Example: Marketing sunscreen
products in regions with sunny
climates.

8. PSYCHOGRAPHIC SEGMENTATION
• Explanation: Grouping customers based on shared
psychographic traits, including lifestyle, values, attitudes,
interests, and beliefs.
• Example: Promoting adventure sports equipment to thrill-
seekers or eco-friendly products to environmentally
conscious consumers.

9. BEHAVIORAL SEGMENTATION
• Explanation: Segmenting the market based on customers'
behavior, which includes usage patterns, brand loyalty,
purchase history, and the benefits sought.
• Example: Offering discounts to frequent shoppers or
providing premium services to loyal customers.

10. PRICE SEGMENTATION
• Explanation: Dividing the market based on customers'
price sensitivity and willingness to pay for products or
services.
• Example: Offering different pricing tiers for software
subscriptions (e.g., basic, premium, enterprise).

11. USAGE RATE SEGMENTATION
• Explanation: Segmenting the market based on how
frequently customers use a product or service.
• Example: Offering special deals or loyalty programs for
frequent users of a service (e.g., airline frequent flyer
programs).

12. BENEFITS OF EACH BASIS FOR MARKET
SEGMENTATION
• Demographic Segmentation:
• Enhanced targeting precision.
• Better understanding of age and income-related preferences.
• Geographic Segmentation:
• Localization of marketing efforts.
• Catering to climate-specific needs.
• Psychographic Segmentation:
• Tailored messaging to align with consumer values.
• Building stronger emotional connections.

13. • Behavioral Segmentation:
• Improved customer retention.
• Personalized product recommendations.
• Price Segmentation:
• Maximizing revenue by offering pricing options.
• Meeting the budget constraints of diverse customer groups.
• Usage Rate Segmentation:
• Customized marketing to encourage increased usage.
• Building long-term loyalty among frequent users.

14. SELECTING THE RIGHT BASIS FOR YOUR
BUSINESS
• Considerations:
• The nature of your product or service.
• Availability of data.
• Relevance to your target market.
• Emphasize the importance of aligning the chosen basis
with business objectives

15. COMBINING MULTIPLE BASES
• Explanation: Businesses often use multiple bases
simultaneously for a more precise segmentation strategy.
• Example: Combining demographic and behavioral factors
to create a comprehensive customer profile.