Market Segmentation

Steps in Market Segmentation, Targeting, and Positioning

1. Identify bases for segmenting the market 2. Develop segment profiles

Market Segmentation

Market Targeting

3. Develop measure of segment attractiveness 4. Select target segments 5. Develop positioning for target segments 6. Develop a marketing mix for each segment

Market positioning

Step 1. Market Segmentation Levels of Market Segmentation

Through Market Segmentation, Companies Divide Large, Heterogeneous Markets into Smaller Segments that Can be Reached More Efficiently And Effectively With Products and Services That Match Their Unique Needs.
Same product to all consumers

Mass Marketing

(no segmentation, i.e Tomato Seller)

Different products to one or more segments

Segment Marketing

(some segmentation, i.e. Pepsi)

Step 1. Market Segmentation Levels of Market Segmentation

(more segmentation, i.e. Standard or Luxury Cars)
Products to suit the tastes of individuals and locations Different products to subgroups within segments

Niche Marketing
Micromarketing

(complete segmentation)

Local Marketing
Tailoring brands/ promotions to local customer groups, i.e Sears

Individual Marketing
Tailoring products and programs to the needs of individual customers, i.e. Dell
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Step 1. Market Segmentation

Geographic Segmentation
World Region or Country

City or Metro Size

Density or Climate

Step 1. Market Segmentation

Demographic Segmentation
Dividing the market into groups based on variables such as: Age Gender Family size or life cycle Income Occupation Education Religion Race Generation Nationality
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Step 1. Market Segmentation

Psychographic Segmentation

Divides Buyers Into Different Groups Based on:

Step 1. Market Segmentation

Behavioral Segmentation
Dividing the market into groups based on variables such as: Occasions Benefits User status Usage rate Loyalty status Readiness stage Attitude toward product
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