Market Segmentation Market segmentation is the first step in determining who your target market is. Market segmentation is a marketing concept which divides the complete market set up into smaller subsets comprising of consumers with a similar taste, demand and preference. A market segment is a small unit within a large market comprising of likeminded individuals. One market segment is totally distinct from the other segment. A market segment comprises of individuals who think on the same lines and have similar interests. The individuals from the same segment respond in a similar way to the fluctuations in the market. Traditional market segments are identified using the following characteristics: • Demographics • Psychographics • Geographics • Behavioral Demographic segmentation Demographic segmentation is defined by age, education, occupation, income, gender, race, sexuality, family size, interests, and more. It’s the most commonly used form of segmentation because it’s essentially the root of all of our spending habits, where we live defines where we buy things, where we work has a huge influence on what we buy, and how much we spend is heavily dependent on how much we earn. For example, a common product which is segmented based on demographics is body wash. Generally, you’ll see body wash for women and body wash for men. Psychographic segmentation While demographics tell us who the customer is, psychographics tell us why the customer buys a product. Psychographics categorizes customers by factors relating to personality and characteristics, like lifestyle, values, opinions, and hobbies. For example, a company like Mercedes Benz focuses on customers who value luxury and status, while Volkswagen, which literally translates to ‘the people’s car’ in German targets an audience who value affordability and reliability. Geographic segmentation Geographic segmentation categorizes customers based on geographic boundaries. For example: • Country • State • City • Zip Code • Climate • Urban or rural For example, a company that sells only waterproof outerwear would have an easier time targeting markets in Seattle than say, Arizona. Behavioral segmentation Behavioral segmentation divides consumers by behavior patterns as they interact with a business - their knowledge of a product, what they like or dislike about a product or a service, how often they interact with a certain area of your app, and so on. Netflix has the perfect model of behavioral segmentation, with each user receiving recommendations completely unique to them and based purely on their viewing behaviors. The data doesn’t lie, around 80% of Netflix views come from the recommendation feature. Benefits of market segmentation: There are many benefits of market segmentation. 1. More effective marketing This is the biggest and most obvious benefit to well-implemented market segmentation. By better recognizing the needs of your customers, you can identify more effective tactics for reaching them

1. Presentation on
Market Segmentation

2. Presented by
2
Atiqur Rahman
Student Of IPE
National Institute of textile engineering &
Research

3. Market Segmentation
“Market segmentation is the process of
differentiating market buyers in several
criteria and choose the best’ segment’ for
maximum sales. Its refer to the sub-
classes of the market, reflecting sub-
classes of wants, and the process of
conceptually distinguishing segments is
known as the process of market
segmentation.”
3

4. Bases of Market Segmentation
1
Demographic
Relating to the structure
of population
2
Behavioral
Identifies consumers based
on what they do
3
Psychographic
Classifying people based on
general demographic data
4
Geographic
Groups prospective customers
based on where they live
4

5. Demographic Segmentation
Religion
5

6. Behavioral Segmentation
Purchase and Usage Behavior
Occasion Purchasing
Loyalty
Benefit Seeking
6

7. Psychographic Segmentation
Lifestyle
Hobbies
Social Status
Beliefs
7

8. Geographic Segmentation
Region
City
Density
Climate
8

9. Benefits of Market Segmentation
1
More effective
marketing
2
More efficient
spending
3
Higher quality leads
5
Identifying niche
markets
7
Improved customer
retention
4
Differentiating your
brand
6
Most Suitable Market
8
More focus
9

10. Why Market Segmentation is
Important?
1. Identification of Market Opportunities
2. Effective use of marketing resources
3. Evaluation of competitors
4. Strategic planning
5. Market specialization
6. Effective marketing mix
7. Environmental adaptation 10

11. Steps to implement a market
segmentation strategy
Define your market
Segment your market
Understand your market
Build your customer segment
Test your strategy 11

12. Conclusion
“Market segmentation is a highly effective
strategy for organizations because it
allows them to know which customers
care about them and understand their
needs enough to send a message that
ensures brand success.”
12

13. Thank You