Market and Market segmentation,Part-1

1. Market and Market Segmentation
Rajeev Shrestha
Lecture 8 – March 28, 2012

2. Market and Market Segmentation
Topic Outline
 Market and its types
 Customer-Driven Marketing Strategy
 Market Segmentation
 Market Targeting
 Differentiation and Positioning

3. Market
 An actual or nominal place where forces of
demand and supply operate, and where buyers
and sellers interact (directly or through
intermediaries) to trade goods, services, or
contracts or instruments, for money or barter.

4. Market
 Markets include mechanisms or means for
 determining price of the traded item,
 communicating the price information,
 facilitating deals and transactions, and
 effecting distribution.
 The market for a particular item is made up of
existing and potential customers who need it and
have the ability and willingness to pay for it.

5. Types of Market
 Consumer Markets
 Business Markets
 Global Markets
 Non-Profit and Governmental Markets

6. Consumer Market
 Companies selling mass consumer goods and
services.
E.g.: soft drinks, toothpaste, television, etc
 This requires getting a clear sense of their target
customers and what needs their products will
meet and communicating brand positioning
forcefully and creatively.

7. Consumer Market
 Consumer marketers decide on the features,
quality level, distribution coverage and promotion
expenditures that will help their brand achieve a
leading position in their target market.

8. Business Market
 Companies selling business goods and services.
 Business buyers buy goods and services for their
utility in enabling them to make a product or resell
a product to others and they purchase products to
make profits.
 Businesses marketers must demonstrate how
their products will help customers to achieve
higher revenue or lower cost.

9. Global/ International Market
 Companies selling business goods and services.
 Business buyers buy goods and services for their
utility in enabling them to make a product or resell
a product to others and they purchase products to
make profits.
 Businesses marketers must demonstrate how
their products will help customers to achieve
higher revenue or lower cost.

10. Non profit and government market
 Companies selling their goods to non profit
organizations such as
churches, universities, charitable organizations
and government agencies.

11. Market Segmentation
 Market segmentation is the process that
companies use to divide large, heterogeneous
markets into small markets that can be reached
more efficiently and effectively with products and
services that match their unique needs.

12. Market Segmentation
 Segmenting consumer markets
 Segmenting business markets
 Segmenting international markets
 Requirements for effective segmentation

13. Segmenting Consumer Market
Geographic Demographic
segmentation segmentation
Psychographic Behavioral
segmentation segmentation

14. Geographical Segmentation
 Geographic segmentation divides the market into
different geographical units such as
 Nations,
 Regions,
 Zones,
 Districts,
 Cities,
 Climate,
 Density

15. Demographic Segmentation
 Demographic segmentation divides the market
into groups based on variables such as age,
gender, family size, family life cycle, income,
occupation, education, religion, race, generation,
and nationality

16. Demographic Segmentation
 Age and Life-Cycle Stage
 The process of offering different products or using
different marketing approaches for different age
and life-cycle groups
 Eg. HDFC Standard Life PENSION PLANS

17. Demographic Segmentation
 Gender segmentation
 Divides the market based on sex (male or female)
 Hero Honda Pleasure

18. Demographic Segmentation
 Income segmentation divides the market into
affluent or low-income consumers