2. THE BREAKING DOWN OR BUILDING UP OF
POTENTIAL BUYERS INTO GROUPS CALLED
What is Market Segmentation?
3. Benefits of
Identifies opportunities for new product development
Helps design marketing programs most effective for
reaching homogenous groups of buyers
Improves allocation of marketing resources
4. The need for marketing
The marketing concept calls for understanding customer
and satisfying there needs better than the competition.
Different customers have different needs, and its rarely
possible to satisfy all the customers by treating them
5. Difference between a mass market
and target market
Mass market refers to treatment of the market as a
homogenous group and offering the same marketing
mix to all customers.
6. Difference between a mass market
and target market
Target market on the other hand recognizes the diversity
of the customers and does not try to please all of them
with the same offering.
7. Requirements of market segments
Indefinable: the differentiating attributes of the segments
must be measurable so they can be identified.
Accessible: the segments must be reachable through
communication and distribution channels.
8. Requirements of market segments
Unique needs: to justify separate offerings, the segments
must respond differently to different marketing mixes.
Substantial: the segments should be sufficiently large to
justify the resources required to target them.
9. Requirements of market segments
Durable: the segments should be relatively stable to
minimize the cost of frequent changes.
15. Age : Marketers design, package and promote products differently
to meet the wants of different age groups.
Good examples include the marketing of toothpaste (contrast the
branding of toothpaste for children and adults) and toys (with many
16. Gender: Gender segmentation is widely used in consumer
The best examples include clothing, hairdressing, magazines and
toiletries and cosmetics.
17. Demographic segmentation
Income: Many companies target affluent consumers with luxury
goods and convenience services.
Good examples include Coutts bank; Moet & Chandon champagne
and Elegant Resorts - an up-market travel company.
18. Demographic segmentation
Social class: Consumers "perceived" social class
influences their preferences for cars, clothes, home
furnishings, leisure activities and other products &
19. Demographic segmentation
Lifestyle: Marketers are increasingly interested in the effect of
consumer "lifestyles" on demand. Unfortunately, there are many
different lifestyle categorization systems, many of them designed by
advertising and marketing agencies as a way of winning new
marketing clients and campaigns.
22. Opinions, interests and hobbies – this covers a huge area
and includes consumers’ political opinions, views on the
environment, sporting and recreational activities and
arts and cultural issues.
23. Degree of loyalty – customers who buy one
brand either all or most of the time are
valuable to firms.
24. Occasions – this segments on the basis
of when a product is purchased or
25. Benefits sought – this requires marketers to identify and
understand the main benefits consumers look for in a
Usage – some markets can be segmented into light,
medium and heavy user groups.