• Market segmentation is the process of dividing
the total market into relatively distinct
homogeneous sub-groups of consumers with
similar needs or characteristics that lead them to
respond in similar ways to a particular marketing
• Market segment is a portion of a larger market in
which the individuals, groups, or organizations
share one or more characteristics that cause them
to have relatively similar product needs.
WHY SEGMENTATION ?
• Segmentation studies are used to uncover
needs and wants of specific groups of
consumers for whom the marketer
develops especially suitable products and
services to satisfy their needs.
Five conditions must exist for segmentation to be meaningful:
1. A marketer must determine whether the market is
heterogeneous. If the consumers’
homogeneous, then it is senseless to segment the market.
2. There must be some logical basis to identify and divide the
population into relatively distinct homogeneous groups,
having common needs or characteristics and which will
respond to a marketing program. Differences in one market
segment should be small compared to differences
3. The total market should be divided in such a manner that
comparison of estimated sales potential, costs, and profits of
each segment can be done.
4.One or more segments must have enough
profit potential that would justify developing
and maintaining a marketing program.
5.It must be possible to reach the target segment
effectively. For instance, in some rural areas
in India, there are no media that can be used to
reach the targeted groups. It is also possible
that paucity of funds prohibits the development
required for a promotional campaign.
BASES FOR SEGMENTATION :
• A segmentation variable is a
characteristic of individuals, groups or
organizations that marketers use to
divide and create segments of the total
Region , Nation ,Urban,
Rural State ,City size
Gender ,Family size ,Age
Occupation ,Race, Family
life, Cycle, Religion, Income
Social class , Education
Usage volume, Occasion
End use Benefits sought
• Dividing the market into different geographic
• Dividing the market into groups based on
• Dividing buyers into different groups based on
• social class
• Personality characteristics
BEHAVIORISTIC SEGMENTATION :
• Buyers are divided into groups based on :
• Use or response to a product
Requirements for Effective Segmentation
• Size, purchasing power,
profiles of segments can be
• Segments can be effectively
reached and served.
• Segments are large or
profitable enough to serve.
• Effective programs can be
designed to attract and serve
Target Market :
Consists of a set of buyers who share
common needs or characteristics that the
company decides to serve.
Evaluating Market Segments :
• Segment Size and Growth
– Analyze current sales, growth rates and expected
profitability for various segments.
• Segment Structural Attractiveness
– Consider effects of: competitors, availability of
substitute products and, the power of buyers &
• Company Objectives and Resources
– Company skills & resources needed to succeed in that
– Look for Competitive Advantages.
Act of designing the company’s offering and
image to occupy a distinctive place in the mind
of the target market.
• Step 1. Identifying Possible Competitive
• Step 2. Selecting the Right Competitive
• Step 3. Communicating and Delivering the
Developing and Communicating a Positioning
• Positioning: How many ideas to promote?
Unique selling proposition
– Four major positioning errors
The way a company aims to identify or
The way the public perceives the company or
• Choose any upcoming or lesser known Agri
Input product and prepare a hypothetical
marketing strategy for the same. Prepare hard
and soft copy of the same.
• Note : soft copy in form of PPT.
• Last date for submission : 24/02/2014
• Secondary data can be used .