MARKET

SEGMENTATION
SUBMITTED TO: SUBMITTED BY:
DR. PARDEEP AHLAWAT RUCHI BANSAL
MBA (Gen.) 2.2
ROLL NO:329
 CONTENT
• INTRODUCTION
• MARKET SEGMENTATION
• BENFITS
• LEVELS
• MASS MARKETING
• SEGMENT MARRKETING
• NICHE MARKETING
• INDIVIDUAL MARKETING
• BASES
• GEOGRAPHIC SEGMENTATION
• DEMOGRAPHIC SEGMENTATION
• PSYCHOGRAPHIC SEGMENTATION
• BEHAVIORAL SEGMENTATION
• CONCLUSION
 INTRODUCTION
Companies cannot connect with all customers in large,
broad, or diverse markets. But they can divide such markets
into groups of consumers or segments with distinct needs
and wants. A company then needs to identify which market
segments it can serve effectively. This decision requires a
keen understanding of consumer behavior and careful
strategic thinking. To develop the best marketing plans,
managers need to understand what makes each segment
unique and different. Identifying and satisfying the right
market segments is often the key to marketing success.
The concept of market segmentation was coined by Wendell
R. Smith who in his article “Product Differentiation and
Market Segmentation as Alternative Marketing Strategies”
observed  “many examples of segmentation” in 1956.
Market segmentation can be defined as the process of
dividing a market into distinct subsets of consumers with
common needs or 2 characteristics and selecting one or
more segments to target with a distinct marketing mix. it can
be concluded that segmentation is to divide a market
consists of consumers with diverse characteristic and
behaviors into homogenous segments that contain persons
who will all respond similarly to a firm’s marketing effort.
When this is done, the company is in a position to answer
“What are our target markets.”
 BENEFITS
CREATE
STRONGER DESIGN HYPER-
MARKETING TARGETED ADS
MESSAGES
IDENTIFY THE DIFFERENTIATE
ATTRACT (AND
MOST EFFECTIVE YOUR BRAND
CONVERT)
MARKETING FROM
QUALITY LEADS
TACTICS COMPETITORS

BUILD DEEPER IDENTIFY NICHE

CUSTOMER MARKET STAY FOCUSED
AFFINITY OPPORTUNITIES
 LEVELS

Marketers subdivide markets into segments, so they can do

focus on marketing plans. Each Level of market segmentation
determines the strategy a company will follow to promote,
distribute and position its product in the market and
respectively target audience or its customers. Before
developing a marketing plan, one must know the what are the
levels of market segmentation.
 MASS
MARKETING
In mass marketing consumers are indistinguishable and all are in one
segment. Here the seller engages in the mass production, mass distribution,
and mass promotion of one product for all buyers. The strategy involved in
this type of marketing strategy focuses on a higher volume of sales at lower
prices so as to obtain maximum exposure for the product. Mass marketing is
very effective in advertising products that are rendered as necessities and
are guaranteed that people will shop for it anyway. Telecom operators
make use of mass marketing campaigns because telecommunication
services are being used by a huge number of people.
 SEGMENT
MARKETING
Segment marketing refers to a strategy where the company
divides its target audience into different segments based on their
unique needs and requirements. The strategy of segmentation
allows producers to avoid head-on competition in the market by
differentiating their offerings, not only on the basis of price, but
also through styling, packaging, promotional appeal, method of
distribution, and superior service. The example of segment
marketing within clothing industry may be men, women, casual,
fashionable and business clothing segments.
 NICHE MARKETING
Niche marketing can be explained as a marketing tactic which targets a
specific and unique market segment. This type of market is created after
identifying the wants and needs of the customer. Niche marketing is
sometimes also called micro-marketing. Niche market does not mean a
small group of people or a small segment of the market. It includes
targeted audience for which companies have specialized offerings. In
this way, the company aims to become a market leader within that niche.
INDIVIDUAL MARKETING
When a marketer detects as many segments as there are
consumers, so that each segment is composed of only one
consumer, it has been identified an individual marketing or a
customized marketing. This results when the marketer
believes that no two consumers will respond the same way to
its marketing efforts. As a result, the marketer is forced to
produce a customized product specifically designed and
positioned for each consumer to whom it wants to market.
Health and exercise marketers provide examples of
customized marketing.
 BASES
Market segmentation is based on the assumption that all the
potential customers are not identical and that the firm
should address their needs with appropriate product Land
other marketing strategies or else should concentrate on
only one single segment and tailor the strategy accordingly.
Marketers establish the basis to segment the market. There
are several basis available for segmenting the market where
marketers may use any one or a combination of more than
one basis to segment the market. These bases range from
age, gender, etc. to psychographic factors like attitude,
interest, values, etc.
 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. In that
way it can tailor marketing programs to the needs and wants of
local customer groups in trading areas, neighborhoods, even
individual stores. In a growing trend called grassroots marketing,
such activities concentrate on getting as close and personally
relevant to individual customers as possible. Geographic
segments can easily be reached through the local media,
including newspapers, TV, and radio, advertisement through
regional editions of magazines.
 DEMOGRAPHIC
SEGMENTATION
In demographic segmentation, we divide the market on
variables such as age, family size, family life cycle, gender,
income, occupation, education, religion, race, generation,
nationality, and social class. One reason demographic
variables are so popular with marketers is that they’re often
associated with consumer needs and wants. Another is that
they’re easy to measure. They are invariably included in
psychographic and socio-cultural studies, because they add
meaning to the findings. Demographic variable reveal
ongoing trends, such as shifts in age, sex (gender), and
income distributions, that signal business opportunities.
 PSYCHOGRAPHIC
SEGMENTATION
Psychographics is the science of using psychology and
demographics to better understand consumers. In psychographic
segmentation, buyers are divided into different groups on the
basis of psychological/personality traits, lifestyle, or values.
People within the same demographic group can exhibit very
different psychographic profiles. Psychological characteristics
refer to the inner or intrinsic qualities of the individual consumer.
Consumer segmentation strategies are often based on specific
psychological variables. For instance, consumers may be
segmented in terms of their needs and motivations, personality,
perceptions, learning, level of involvement, and attitudes.
 BEHAVIORAL
SEGMENTATION
Traditional approaches to segmentation focused mainly on who
customers are and segments were based on demographic attributes
such as gender or age, and firmographic attributes like company size or
industry. But its not enough for work in global era. Behavioral
segmentation is about understanding customers not just by who they
are, but by what they do, using insights derived from customers’ actions.
Behavioral segmentation is defined as the process of dividing the total
market into smaller homogeneous groups based on customer buying
behavior. Behavioral segmentation is done by organizations on the basis
of buying patterns of customers like usage frequency, brand loyalty,
benefits needed, during any occasion etc. It is done keeping in mind the
needs and wants of a customer based on the behavior that they show.
 CONCLUSION
All of these consumer attributes were discussed within the
framework of market segmentation that is, an approach to selecting
groups of homogenous consumers as targets for marketing activity.
Most firms today follow a market segmentation approach.
Furthermore, it was shown that in order for market segmentation to
be effective, the target group must be identifiable and measurable;
accessible; substantial; and responsive. With these criteria in mind,
four alternative bases for segmentation were discussed
demographic, lifestyle, usage and benefit. Some newer approaches
to market segmentation were also presented. Traditional
approaches, however, are still incorporated in these techniques
because marketers must have demographic, geographic, and
socioeconomic information about any segments chosen if they are
to market effectively to them.
 A N K
T H
YO U