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Final Retail - Market Segmentation
Final Retail - Market Segmentation
SEGMENTATION
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Before Segmenting Retail Market,
let us discuss the following 3 issues
What is Market Segmentation?
What are the factors that derive marketers
to segment their market or market of their
product/service?
What are the bases for segmentation?
2
What is Market
Segmentation?
Grouping customers depending
upon their wants, which are
governed by age, gender, lifestyle,
aspiration, disposable income,
esteem need, etc.
In fact, it’s a first and vital step of
Strategic Marketing followed by
Targeting and Positioning.
3
What is Segmentation
Segmentation Techniques
Based on Usefulness and Measurability
Usefulness
Age
Ethnicity Gender
High
Income
Lifestyle
socio-demographic
Attitudes segmentation
Low
Generic
need
sought
Low Measurable
High 4
What are the factors that
derive marketers to segment
their market ?
Customer Fragmentation
Efficiency
Information Technology
Resources
5
What are the bases for
segmentation?
Geographic factors
Demographic Factors
Psychological Factors
Psychographic (Lifestyle) Factors
Socio-cultural Variables
Use-related Characteristics
Use-situation Factors
Benefits sought
Forms of Hybrid Segmentation
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Segmentation of Retail Market
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CONCEPT OF SHOPPING
Shopping is an activity that we perform with a high level
of regularity and involvement. It is more than just a
necessity – it is a desirable activity which appeals to the
inherent nature of humans.
The concept of shopping can be understood from
different perspectives –
Shopping Environment
Shopping in a Socio-cultural Context
Shopping and an Individual
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Shopping Environment
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Shopping in a Socio-cultural
Context
We are basically a social species and most of us
would like to spend some part of leisure time in
socializing. Thus, markets are not only place to
exchange goods and money but a place to see and
be seen at.
Modern day shopping is a private place pursuit,
involving the experience of wandering among
crowd and responding to a wide range of stimuli.
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Shopping and an Individual
People’s motives for shopping are a function
of many variables some of which are
unrelated to actual buying of products, which
can be -
Role-playing
Diversion
Self-gratification
Learning about New Trends
Physical Activity
Sensory Stimulation
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Now, let us discuss the
Shopping Process
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The Shopping decision can be
analyzed from two perspectives, viz. ,
the Decision Process
the factors affecting the process
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Decision Process
5 Basic steps:
Identification of a need for the product or
service
Information search
Evaluation of alternatives
Purchase
Post-purchase behaviour
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Factors influencing the retail
shopper behaviour
Range of Merchandise
Convenience of shopping at a
particular outlet
Time to travel
Socio Economic Background & Culture
The Stage of Family Life Cycle
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RETAIL MARKET
SEGMENTATION
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To increase their efficiency, retailers identify groups of
customers (market segment) and target their offerings to meet
the needs of typical customers in that segment rather than the
needs of a specific customer.
A retail market segment is a group of customers whose needs
are satisfied by the same retail mix because they have similar
needs.
For example, families travelling on a vacation have different
needs than executives on business trips. Thus, Marriot offers
hotels with different retail mixes for each of these segments.
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Criteria for Evaluating Market
Segments
Customers are grouped into segments in
many different ways. There’s no simple way
to determine which method is best.
Four criteria for evaluating whether a retail
segment is a viable target market are –
Actionability
Identifiability
Accessibility
Size.
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APPROACHES FOR
SEGMENTING RETAIL MARKET
-Consumer Behavior
-Maslow’s Hierarchy Model
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APPROACHES FOR
SEGMENTING MARKETS
Consumer Behavior
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Geographic Segmentation
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Demographic Segmentation
Age Education
Gender Religion
Family income
nationality
Occupation
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Geodemographic
Segmentation
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Psychographic Profile of Indian Shoppers
(Men)
Traditional man- conservative, driven by values, cherishes
family, avoid ostentation.
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Psychographic Profile of Indian Shoppers
(Women)
Archetypal provider- believes of her role is to provide for and l;ook after the
well being of her family
Anxious rebel- Working women, who is not happy with the existing state of
affair.
Troubled homebody- House-wife who is not sure that she is doing the right
thing by sitting at home.
Psychographic Profile of Indian Shoppers
(Women)
Rebels- ??
Cool guys- they are influencers, others want to be like them. They bare
confident and have strong sense of individuality.
Value & Lifestyle Profile of Indian Shoppers
Pre-independence shoppers- Anti British, take pride in India, support local products.
Pre-Rajeev Gandhi shoppers- Socialistic, anti-rich, license permit driver, ape and bait
the west.
Post-Rajeev Gandhi shoppers- Capitalistic, global orientation, ape the west, tech.
savvy.
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Media graphics of Indian Shoppers
(Men)
Settled corpos
Couch potatoes
Sarkari babus
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Media graphics of Indian Shoppers
(Men)
Aiyappan sars
Common man
Retail patels
traditionalist
Media graphics of Indian Shoppers
(Women)
Media-intense modern
Cine meenas
Simple Sudhas
Premeditated shoppers
Economizing shoppers
Support Seekers
Recreational Shoppers
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Attitude or Orientation Based Segmentation
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APPROACHES FOR
SEGMENTING MARKETS
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The notion that a comprehensive coverage of
human needs can be organized into an
understandable hierarchical framework is of
obvious benefit.
If individuals are satisfying basic needs and
seeking self-fulfillment, then the retailer has to
understand the need to offer products which
allow consumers the opportunity to fulfill their
higher needs of self-improvement, the
attainment of individuality, provide status and
give some more meaning in life.
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TYPES OF SHOPPER
Compulsive shopper
Economic consumer
Befriending consumer
Ethical consumer
Apathetic consumer
Habitual shopper
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Motivations are an important clue to the purpose
and type of shopping individuals will undertake.
This helps retailers position their store to appeal to
the different preferences based upon merchandise,
price and quality.
This leads to decisions in terms of which type or
types of shoppers to attract and how many of them
are able to be targeted.
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