Market Segmentation

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Presented by: Adela Lupsa 3847104 Simona Caus 3856284

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Philip KOTLER TRADITIONAL view on Market Segmentation

To satisfy effectively customer needs, companies

need to identify the market segments they can serve, they cannot connect with all customers

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BASES OF MARKET SEGMENTATION

1.

Geographic Segmentation: divide market into geographic units like nation, regions, cities and pay attention to local variation Demographic characteristics: age, occupation, gender, income Psychographic: personality, values, lifestyle Behavioural: consumer knowledge and attitude towards a product

2. 3. 4.

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Behavioral Segmentation
Brand variation
Aware Ever tried Recent trial Occasional user Regular user Most often used
Hard-core Split loyals

Brand loyalty

Shifting loyals

Switchers

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EFFECTIVE SEGMENTATION CRITERIA

Size, purchasing power, profiles of segments can be measured. Segments must be effectively reached and served. Segments must be large or profitable enough to serve. Segments must respond differently to different marketing mix Must be able to attract and serve the elements & actions. segments.

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Benefits
Products offered fit more

LIMITATIONS
Targeting multiple

with customer specific needs

Company can offer better

design, price, disclose and deliver the product or service

Company can use more

segments can increase marketing cost

Limits general

popularity for a product

Increased costs to

efficient marketing resources

Company can better

develop variations of the product

understand the competitive environment

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Rachel Kennedy and Andrew Ehrenberg (2001): There is Segmentation!

Brand

Different brands appeal to different people: => Countless segmentation studies => Research and marketing expenses => Marketers encouraged ? => Company limited to small niche But

Click to edit Master subtitle Similar brands to appeal to similar people ! style

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Competitive brands : existent

are bought by very similar client bases brand level segmentation is slight or non-

Researc h:

Based on BMRB Internationals TGI For 42 varied Industries in UK TGI continuous self completion survey, Click to edit Master subtitle TGI-based on 25000 adults style annually Buy /use /serve the category? How often? Which specific brands?

Respondents state :

Rachel Kennedy and Andrew Ehrenberg

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The results :

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Individual brands percentage deviation = 2-3%

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The results :

The average MAD for all demographic media :

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Pinpoints the lack of deviation between brands !

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NO Segmentation

Advantages :

Disadvantag es :

No restriction to a specific market No limitation to a small niche Sales increase No market segmentation research expenses

Large mass market => more direct competitors Click to edit are usually Competitive products Master subtitle substitutable style More important Logistics than product Whats next? itself Marketers still need to publicise and sell their brand Marketers can help a brand to stand out

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