The document discusses different types of market segmentation. Market segmentation involves dividing buyers into internally similar groups based on characteristics like demographics, behaviors, or geographic location. Segmentation allows companies to target specific buyer groups and better appeal to their needs. Common bases for segmentation include geographic location, demographics (age, gender, income), psychographics (lifestyles and attitudes), and benefits sought. Demographic segmentation using variables like age, gender, household size is very common. Segmentation provides insights into how to reach different buyer groups.

1. Asif Nawaz
Afridi

2. What is Market Segmentation?
The process of breaking of buyers into groups that are
different from each other but internally similar
Applicable any marketing situation: Business to
business, business to consumer, not-for-profit,
politics

3. Why segment?
Starts from the premise that all buyers are not the
same: profit/volume potential, motivations, product
uses, needs and desires, etc.
Segmentation allows you to chose which buyers to
target and provides important insights as to how to
appeal to them.
Significant competitive advantage

4. Market Segmentation
Characteristics
age
gender
geographic location
income
spending patterns
cultural background
demographics
marital status
education
language
mobility

5. Market Segmentation
4 commonly used bases for Segmentation
Descriptive
geographic location
demographic
Behavioural
psychographic
benefits

6. Figure 3.1 Bases for Market SegmentationSlide 3-7

7. Market Segmentation
geographic location - based upon where people live
(historically a popular way of dividing markets)
demographic - based upon age, gender and income level
(very often used)

8. Market Segmentation
Psychographic / lifestyles - based on people’s
opinions, interests, lifestyles
eg, people who like hard rock music probably prefer
beer to wine
benefits - based on the different expectation that
customers have about what a product/service can do
for them
eg. People who want to but “lite” food cause it will help
them lose weight

9. Geographic Segmentation
The reason why we study geographic segmentation is
because WHERE people live has a big effect on their
consumption patterns.
Additionally, WHERE people live in a city is also a
reflection of their income level and we can make
certain assumptions about their ABILITY TO SPEND.
This helps people plan store locations and the location
of other services.

10. Demographic Segmentation
Demographic Segmentation is the most common
approach to Market Segmentation
Variables are:
• age
• gender (male/female)
• income
• occupation
• education
• household (family - style) size

11. Demographic Segmentation is the most common
approach to Market Segmentation
Variables are:
• gender (male/female)gender (male/female)
•gender is an obvious way to divide the market into
segments since so many products are gender-specific
• clothing
• medical products
• sports products/services
• entertainment

12. Demographic Segmentation is the most common
approach to Market Segmentation
Variables are:
age
• age is another obvious way to divide the market into
segments since so many products are based upon
“time of life”
• diapers for babies
• toys for children
• entertainment for “over 18”

13. Demographic Segmentation is the most common
approach to Market Segmentation
Variables are:
•household (family - style) size
• Segmenting by the “stages in the family life cycle”
• There are different buying characteristics of people
in each stage of the family

14. •household (family - style) size
BUYING PATTERNS
• 0-5 young children
• 6-19 school children
• 20-34 young adults
• 35-49 younger middle-aged
• 50-64 older middle-aged
• 65+ seniors
• 80+ SUPER seniors

15. income
Segmenting markets on the basis of income and expenditure
patterns.
Income is possibly the most common basis for segmentation
Upper High Class
High Class
Uper Middle Class
Middle Class
Lower Middle Class
Toyota
• Lexus for high end
• Camry for the middle of the roaders
• Corolla for low end
HUL soaps - Dove for high end, Hamam

16. Psychographic Segmentation
“The use of psychological attributes,
lifestyles and attitudes in determining
the behavioral profiles of different
customers”

17. Psychographic Segmentation
Psychographic profiles on a target market segment are
obtained by doing a lot of questionnaires and surveys to
ask people if they agree/disagree with certain statements
made about particular activities, interests or opinions
AIO - activities, interests, and opinions

18. Behavioural Segmentation
On the basis of occasions, product usage, benefits
sought, brand loyalty
Occasions
• Y2K Cruises
• Hallmark Cards
• a greeting card for every occasion -
Valentine’s Day Card, Deepavali card

19. Thank you