CONCEPT AND DEFINITION
The concept of market segment is based on the
fact that the market of commodities are not
homogeneous but they are heterogeneous. Market
represent a group of customer having common
characteristics but two customer are never common
in their nature, habits, hobbies income and
Market Segmentation is a method of “dividing a
market (Large) into smaller groupings of consumers
or organizations in which each segment has a
common characteristic such as needs or behavior.”
1. SEGMENT MARKETING
. Consists of a group of
customers who share a similar
set of needs and wants.
Identifiable Group with in a
Market with Similar
• Purchasing Power
• Geographical Location
• Buying Attitudes
BASIS FOR MARKET SEGMENTATION
Following are the main basis for market
1. Geographical segmentation
2. Demographic segmentation
3. Psychographic segmentation
4. Behavioural segmentation
Divide the market into different group based on :
• Region :
• South India , North , Western Region, East
• City :
• Metro cities, cities with population more than 1 million.
Rural and semi-urban areas:
Rural villages with a population of over 10,000; semi-urban
areas ; small towns with a population between 20,000 and
Dainik Bhaskar Group:
Dainik Bhaskar, in Hindi
Divya Bhaskar, in Gujarati
Divya Bhaskar in Marathi
DNA in English
It is available in 14 states with different four
launguages . It has 7 main editions & 28 District editions.
Videocon D2H :
Videocon D2H provides different packages of
channels to the customers like,
North, East& West India Packages
South India Packages
It is essentially a case of age based segment of market.
Example: Amul has segmented his product in
different age group.
For kids : Amul Kool, chocolate milk, nutramul energy milk
For Youth : Amul cool cafe
For Women & older people : Amul calc+, Amul Shakti energy drink
Young , single; young , married, no children ; young ,
married , youngest child under 6; young , married
,youngest child under 6 or over ; older ,married , with
children ; older , married , no children under 18 ; older ,
single ; other.
Male , Female
HUL provides Fair & lovely for women & men
Red Chief target men in India.
Segmenting the market by keeping in mind the customer’s
Nokia 2600 price RS 2750
Nokia 5130 price RS 5300
Nokia N73 price RS 12500
NokiaN95 price RS 22500
Unskilled worker , skilled worker , petty traders , shop owners
, bussinessman/indusrialist , self-employed ( professionals ,
clerical/salespersons , supervisory levals , officers/junior
exectives. Middle / senior executies .
Example : Raymond suits
Literate , school up to 4 years , school between 5 and 9
years , SSC/HSC , nongraduate ,
graduate/postgraduate ( general) ,
Navneet Publication offers guides & study material for
schools as well as colleges. They olso publish reference
books for competitive exams.
Psychographic segmentation divides buyers into
different groups based on lifestyle, personality
characteristics, or social class.
To better meet the psychological needs of people,
marketers often segment their markets by consumer
personalities and lifestyles.
Thums Up is marketed as a drink for tougher, action-oriented men
whereas Pepsi is marketed predominantly as a youth drink.
CCD choose life style oriented, urban customers as target with
In Behavioural Segmentation, buyers are divided into groups
on the basis of their knowledge of, attitude towards, use of, or
respond to a product.
Variables of buyer behaviour are:
Benefit sought: - Quality/economy/service/look etc of the
Example- Nestle has found a separate atta noodles as
distinct from maida noodles
User status : Heavy user/ moderate user/ light user
Usage Rate : Regular/ potential/ first time user/ irregular/
Loyalty Status : Hard core loyal/ split loyal/ shifting/ switches
Cadbury’s advertisement to promote the product on the
basis of various occasion.
On navratri, there will be a great demand for traditional
On Diwali occassion, people may purchase jewellary
items so we’ll find more advertisement of jewellers like
TBZ, Kalyan Jewellers . The same is true in marriage
2. NICHE MARKETING
Group of customers seeking a distinctive mix of benefits who
are ready to pay extra premium.
Niche = segment sub – segments
e.g Washing detergents hard & gentle washes . Surf excel
for tough stains ( hard on clothes) & Ezee from Godrej for
- Astha , Sanskar , Q TV – focus on religion & spiritualism.
Harley Davidson bikes
Star channel provides various channels for different
i.e for entertainment star plus
For youth - MTV
For hindi movies – Star Gold
For English movies – Star Movies
Also there are 4 different sports channel of star group
Here they provide product/service to a
specific customer group that’s why it can be
considered as niche marketing.
3. LOCAL MARKETING
Marketing programs tailored to the needs & wants of
local customer groups in trading areas, neighborhoods ,
This trend is called grass roots marketing.
- Shiva Bakery in porbandar surves bakery products
only for limited area.
- Induben Khakharawala in ahmedabad can also be
considered as local marketing.
- Mumbai’s Dabbawala also considered as local
4. INDIVIDUAL MARKETING
Ultimate segmentation – segments of 1 or
customized marketing or one to one marketing.
Customerization – empower the consumers to
design the product or service offering of their
Airtel launched MYPLAN in which an individual person can
know about data usages, balance information, n all activated
SBI has also developed a mobile app “ SBI FREEDOM” which
facilitates all banking facilities in mobile to an individual.
Target market selection is the process of
fixing the target market for one particular
product. Target marketing contrasts with
mass marketing, which offers a single
product to the entire market.
Market segmentation involves
dividing customers into groups (market
segments) with common characteristics.
Business is focused on any one segment of the
example For cricket balls, cricket bats and related
sporting gear, cricket clothing, etc. the business
objectives could be to become the largest supplier
of cricket accessories in a particular geographic
The business focuses on a number of segments in
There may not necessarily be any relationship
between the segments; however each segment has
a high degree of value for the business objectives
Since, the segments can stand alone, the risk of
failure is reduced by the diversification - the
assumption is that at least one, or more, of the
segments will be successful at any one time.
The business focuses on one product and it sells to
a number of segments.
For example, a coffee distributor might sell coffee to
a retail store chain, to a number of coffee shops,
and even direct to the end consumer
By expanding one’s market through product
specialization a firm can build a very strong brand
for the product and its business. For example, Café
Coffee Day specializes in different varieties of
The business focuses on supplying many products
to one market segment.
For example, the business might be supplying all
types of sporting goods to sporting goods stores
(e.g. soccer, tennis, cricket, basketball, etc.). With
this type of strategy
TOTAL MARKET COVERAGE
This type of targeting is attempted by large
companies with a lot of financial strength.
The business has many products and services
The cost for this type of target marketing approach
is high: the business must have strong distribution
channels, large resources, and many products.
Small businesses should not attempt total market
• Positioning is not what you do to a
product. Positioning is what you do to
the mind of the prospects.
DEFINITION & CONCEPT
“ Product positioning is defined as the process
of establishing & maintaining a distinctive place in
the market for an organization and/or its individuals
It involves a company’s product/services creating &
occupying a place, in the minds of customers.
Marketer should analyse the current position
occupied by their firms in the (present &
prospective) customer’s minds & take necessary
steps to create a distinct & effective position.
“McDonalds” is known for its ‘variety of products,
speed, and efficient customer services.’
“ The Ritz Carlton” is considered one of the best
hotels around the world for ‘customer services’.
In today’s cut throat competition, company
should differentiate their product/services from
those of their competitors to survive in the
It refers to the process of actually creating a
difference in the perception of a product in the
mind of customers.
It is closely related to product positioning.
DIFFERENTIATION AND POSITIONING STRATEGY
The positioning task consists of three steps:
1. Identifying a set of differentiating competitive
2. Choosing the right competitive advantages,
3. Selecting the overall positioning strategy
1. Identifying a set of differentiating competitive advantages:
Competitive advantage is defined as the strategic advantage
a business organisation has over its competitors in the
Marketers can find different ways to create a differentiation by
analysing the whole set of customers’ experience with the
company’s product or service.
A company can differentiate itself along the lines of the
Product differentiation refers to a differentiation created on the
features, performance, style, or design of the product.
Favicol’s ad campaign differentiate their product by displaying super
quality even in the worst situation like in water too.
Similarly, Hero Honda had used the campaign slogan of “fill it, shut it,
forget it” to differentiate itself of in terms of superior mileage.
Service differentiation is used to differentiate the service in
cases where the market offering is in the form of a service (as
in the cases of hotels, travel packages, online booking
services etc.), or to differentiate the service that accompanies
Example: A “Wildflower Hall” offering a free pick up and drop
facility in Mercedes at the airport is differentiating its services.
People Differentiation is especially significant in the case of
services where human interaction is a key aspect of the value
sought by the consumer.
Customer service provider of vodaphone
Services provided by Hotels, Hospitals, Consultancy firm etc.
Consumers often use the brand’s image to perceive the
difference among competing brands.
For instance, if a company wants to differentiate itself with a
brand image of being trendy, the image should reflect in all its
communication including the company logos, the staff
uniforms, the websites, brand endorsers, colour patterns used
in the ad campaigns etc.
Fastrack watches is generally perceived as the product
Thumps Up ad campaign differentiate themselves in
energetic drink in India.
BATA is famous for quality product
Idea n Vodaphone for unbreakable network....
2. CHOOSING THE RIGHT COMPETITIVE
A company may discover several potential differentiations that
may provide competitive advantages. It must then decide
which competitive advantages to promote.
In the United States for instance, when General Motors
positioned its brand Chevrolet through an ad campaign as a
“large, small, cheap, expensive car”, understandably, the
consumers were confused. The 50 percent market share of
General Motors steadily declined to 29 percent.
Not all brand differences may be considered meaningful or
worthwhile by the consumer. A difference has the potential to
create company costs (in order to fulfil the brand promise),
and to create customer benefits.
In general, for differences to be worth establishing, they
must meet the following criteria;
3. SELECTING AN OVERALL
The overall positioning of a brand refers to the
brand’s value proposition which includes the full set
of benefits upon which it is positioned.
The possible value propositions upon which a
company might position its products can be
classified into categories as depicted in the picture.
Here we have the five winning value propositions :
1. more for more,
2. more for the same,
3. the same for less,
4. less for much less, and
5. more and less.
1. More for more:
“More-for-more” positioning represents the most
upscale product or service that charges a higher price
to cover the higher costs.
Mont Blanc pens
Café Coffee Day
“Oberoi and Hilton” hotels provides high quality
services by charging high prices.
2. More for the same:
Companies attack its high-priced competing brand by
introducing a brand that offers matching or comparable
quality but at a lower price.
Toyota’s Lexus lines of cars against Mercedes and BMW
Samsung has launched phones that offer features
comparable to iPhones at a lesser cost.
And also micromax has launched phones that offers
features comarable to samsung and other android phones
3. The Same for Less:
“The same for less” proposition is based on the fact that
most consumers like a good deal.
Many companies claim not to give better or superior
products but the same products at much lower prices.
Croma, the electronics retail stores
4. Less for much less:
“Less-for-much-less” positioning is usually a high
volume category that meets consumers’ lower quality
requirements at a much lower price.
Maruti 800, and Tata Nano
Low priced hotels,
5. More for less:
“More-for-less” represents the best value proposition
that offers the best or nearly the best in terms of
product benefits but cost much less.
Tata Indica’s offer that claimed to give “more car per car.
CHANGING THE PRODUCT POSITIONING
Changing the identity of a product or a company in
the mind of stake holders and competitors.
The company need to consider a repositioning
strategy if they have a weak brand, if they have not
remained competitive in the market, or if there is a
change in the economy.
CADBURY INDIA -
In initial days Cadbury's chocolates were meant
basically for the kids and the ads also revolved
around that concept only in which parents were
seen trying to bribe or reward their children with
Cadbury’s dairy milk chocolates.
The Cadbury changed this things with the help of
launching innovative advertising campaigns over a
period of time & they become successful in
changing their position in the mind of customers.
The advt camaigns:
“ Kid in all of us”
“ Real Taste of Life”
“ Kuchh Khas Hai Zindagi Mein”
“ Khaane Waalon ko Khaane Ka Bahana Chahiye
“ Kuchh Mitha Ho Jaaye”
“ Pappu Pass Ho Gaya”
“ Radha miss Palampur ban gaye
“ Meetha hai Khaana aaj Pehli Tareekh Hai”
“ Iss Diwali aap Kise khush kar rahe hain”
“ Shubh Aaarambh”
“ Dil Jo Keh Raha hai suno”
Marketing Management- A south Asian Perspective
by Philip Kotler , Kevin Keller, Abraham Koshy,