2. Markets are Heterogeneous; Segmentation
divides them into homogeneous Sub-Units
The Consumers in the Various Segments will Vary
‘Across’ Segments, But be Homogeneous ‘Within’
It is the Consumers who are Segmented, Not
Product, nor, Price
3. Why Segment the Market?
Facilitates right choice of target market
Facilitates effective tapping of the chosen market
Makes the marketing effort more efficient and
economic
Helps Identify Less Satisfied Segments and Concentrate
on Them
4. Markets can be Segmented Using Several Bases
Demographic Segmentation
Age
Gender
Women as a market segment for cosmetics
Olay targets women in India
Purchasing capacity, a major base in demographic
segmentation
5. Socio-Cultural Factors
Culture and social class the two main bases here
Psychographic Segmentation
Lifestyle a major base in psychographic segmentation
Psychographic segmentation helps in positioning &
launch of new products.
6. Buying Behaviour Segmentation
Usage-based segmentation
Start with current users of the brand
Tackle current users of competitors’ brands
Tackle non-users, entering the category for the first
time
In India, in most categories, ‘First Time Users’ will
mean a major segment
7. Benefit’ segmentation
Example of ‘calorie watchers’ and health seekers
Choosing the Target Market (Market Targeting)
Choose All Segments? Only One? A Few?
Evaluation of the Segments
As firms vary in objectives and competencies, different
segments may suit different firms
Within a segment, the highly attractive portions could
be chosen
8. Adding Further Segments to the Target Market
Steps in Choosing Target Market – Illustration of Bath
Soaps
Carries two broad segments : premium and popular
Evaluating the two segments
Is it sizeable?
Is it growing?
Is it profitable?
Is it accessible?
Is it compatible with the firm’s ambitions, resources and
capabilities?
9. Positioning
Creating the Image in the mind of the customer.
USP (Unique Selling Proposition)
Every product has a unique characteristic, which
helps it in the selling.
