7

Segmentation, Identifying Market

Targeting & Positioning
Segments and Targets
 Effective Targeting Requires Marketers
to:
 Identify and profile distinct groups of buyers
who differ in their needs and preferences
 Select one or more market segments to enter
 Establish and communicate the distinctive
benefits of the market offering
What Is a Market Segment?

A market segment consists of a

group of customers who share a
similar set of needs and wants.
Segmenting Consumer Markets

Geographic

Demographic

Psychographic

Behavioral
Geographic Segmentation
Geographic segmentation divides the market
into geographical units such as nations,
states, regions, counties, cities, or
neighborhoods. The company can operate in
one or a few areas, or it can operate in all
but pay attention to local variations.
SEC Rural Consumers
 Demographic Segmentation

 Age and life cycle

 Life stage
 Gender
 Income
 Generation
 Social class
 Race and Culture
Age and Lifecycle Stage
Gender and Income
SEC Classification: Urban Markets
Psychographic segmentation
Lifestyle, Attitude, personality traits, Values
Behavioral Segmentation Based
on Needs and Benefits

Needs and Benefits

Decision Roles

User and Usage

Behavioral Segmentation:
Decision Roles

Initiator

Influencer

Decider

Buyer

User
Behavioral Segmentation:
Behavioral Variables
 Occasions
 Benefits
 User Status-
nonusers, ex-users,
potential users, first-
time users, and regular
users
 Usage Rate
 Buyer-Readiness
 Loyalty Status
 Attitude -
enthusiastic, positive,
indifferent, negative,
and hostile
 Loyalty Status

 Hard-core
 Split loyals
 Shifting loyals
 Switchers
Behavioral Segmentation Breakdown
 Steps in Segmentation Process

 Need-based segmentation
 Segment identification
 Segment attractiveness
 Segment profitability
 Segment positioning
 Segment acid test
 Market mix strategy
Porter’s Five Forces Model

Threat of Rivalry

Threat of Buyer Threat of Supplier

Bargaining Power Bargaining Power

Threat of Threat of
Substitutes New Entrants
Possible Levels of Segmentation