Market Segmentation

How are customers similar

 Common Human
Desires
Protection: Safety,
Freedom: Freedom
Survival: Live a long care and protection
from danger, fear
and healthy life for yourself and
and pain
loved ones

Comfort: Pleasure: Enjoy Relationships:

Comfortable living food, beverages Companionship
conditions and experiences and compatibility

Success: To be Likability: Social

superior, winning, approval, being
keeping up with part of the “in”
the Joneses crowd
 Common Learned Behaviors
Efficiency: Dependability and
Convenience:
Maximum Quality: Higher
Saving money, time
productivity with standards and
or effort
minimal effort reliability

Beauty and Style: Intelligence: To be

Cleanliness: Clean
Expressing informed,
body and
yourself, pleasing understanding and
surroundings
the senses intellectual

Profit: Buying and Bargains:

Curiosity: A strong
selling for profit or Purchasing
desire to learn and
making something something below
discover
for profit retail value
 Recent Common Market Trends
Scarcity: If something is difficult to possess or we’re told we can’t have it, we want it more and attribute
a higher value to it. Something is more valuable if it might get taken away.

Values: We purchase products that align with our personal values. We buy products because they are
made in the USA, sales are donated to charities, or to support a local business.

Individuality: The desire to stand out from the crowd, to be different. It can take many forms – to be first
in the know, to create something viral, to have something before anyone else does. (I call this the
“hipster effect,” named after the subculture of independent, counter-culture youths who eschew
mainstream ideas and thrive on discovering new things before anyone else.)
Security: Personal, family, financial, social
Segmenting
a Market
 Ways of Segmenting

Descriptive Behavioral
 Descriptive

Geographic Demographic Psychographic

• Region • Age • VALS
• Location • Gender
• Climate • Income
• Education
• Social class
 Psychographic
VALS Framework

Resources
• Income
• Education
• Self-confidence
• Intelligence
Ideals
Achievement
Self Expression
 Behavioral

Needs and Users and

benefits usage

Readiness
Loyalty
to buy
 Targeting Approaches

Multiple Single
Mass Market Full market
segments segment
Individualized Customisation
Nike segments
Users and Usage – Buying roles

Decider
Influence
Buyer
r

Initiator
Buying User
roles
Users and Usage – Brand funnel
 Loyalty
• Hard-core
• Split loyals
• Shifting loyals
• Switchers
 Segmenting and Targeting

Matching
Separating
product
customer
features with
expectations
expectations
Positioning is with a Competitive Frame of Reference
• Targeting a segment chooses
competition
 Defining Competition
• Industry • Markets
 ANALYZING COMPETITORS

Awareness Quality Availability Support Price

Company A E E P P G
Company B G G E G E
Company C F P G F F
 Identifying POD and POP

Points of Points of
Difference Parity
• Attributes that
customers • Attributes that
strongly associate are common to
with a brand the category
Points of Difference
Points of Difference

Desirable

Differentiable Deliverable
Points of Parity
 Points of Parity

Category

Competitive Correlational