Segmentation can take many forms, more than just psychographic, or demographic segmentation. See how you can leverage market segmentation by learning. There is also geographic, time, distribution, media, and occasionbased segmentation methods. Tapestry segmentation classifies neighborhoods into 67 unique segments based not only on. The report illustrates the application of the major analytical strategic frameworks in business studies such as swot, pestel, porters five forces, value chain analysis, ansoff matrix and mckinsey 7s model on apple. Music streaming services tend to be targeted to the young, while hearing aids are targeted to the elderly. Demographic, geographic, geodemographic, psychographic and behavioural segmentation as product markets tend to mature, customer needs often become more specialized. Market research using a survey is the best way to segment the target market. Geographic segmentation is the market segmentation strategy in which the market is divided on the basis of regions or geographies. Demographic segmentation is one of the simplest and most commonly used forms of segmentation because the products and services we buy, how we use those products. Pdf identity, demographics, and consumer behaviors. Demographic segmentation slices the market on demographic variables like age of the customer, gender, income, family life cycle, educational qualification, socioeconomic status, religion etc. Market segmentation when the term market segmentation is used, most of us immediately think of psychographics, lifestyles, values, behaviors, and multivariate cluster analysis routines.
One faction within the market may be recognized by gender, while another may be made up of purchasers within a certain age category. Using different types of market segmentation allows you to target customers based on unique characteristics, create more effective marketing campaigns, and find opportunities in your market. With this type of segmentation, an organization can categorize the needs of consumers. This helps in creating groups exhibiting a similar. Locality is another general element in market segmentation, along with. Apple segmentation, targeting and positioning research. Each group or market segment should be similar in terms of certain characteristics or product needs.
If so you have been using the most common form of market segmentation known as demographic segmentation. A combination of demographic, psychographic, geographic, and behaviour information is commonly used to segment a market. Tapestry segmentationesri demographics documentation. Demographic segmentation is one of the most popular bases for segmenting customer groups. Demographic segmentation involves dividing the market into groups that are identifiable in terms of physical and factual data. They include the demographic segmentation, which is. Marketer will identify the customer need and want then only decide if it is practical to develop marketing mix to satisfy those wants.
Hudon this article uses psychographic clustering techniques to segment the market for farm supplies. This research paper will provide information about the knowledge gap and will show a path for future research in the area of market segmentation, which. It also gives information on segmentation of market with respect to demographics. Demographics can be segmented into several markets to help an organization target its consumers more accurately. Tapestry segmentation provides an accurate, detailed description of americas neighborhoodsu. Market segmentation is the first step in defining and selecting a target market to pursue. Because people from different places are likely to have different preferences, dividing the market on a geographical basis is a more reliable predictor of consumer interest than demographic market segmentation. Demographic and psychographic variables based on the differentiation of consumer brand preference were used to elicit the characteristics of market segments. Or to put it another way, market segmentation is the division of a mass market into identifiable and distinct groups or. It also can help you segment customers based on the attributes they desire from the product. The purpose of segmentation is the concentration of marketing energy on a smaller group or segment. People who work in business industry cant avoid travelling around the world for business purposes.
Demographic segmentation is one of the simplest and most widest type of market segmentation used. Demographic segmentation sorts a market by demographic elements such as age, education, income, family size, race, gender, occupation, nationality, and more. Twentythree psychographic dimensions produced four clusters. Market segmentation is the activity of dividing a broad consumer or business market, normally consisting of existing and potential customers, into subgroups of consumers known as segments based on some type of shared characteristics in dividing or segmenting markets, researchers typically look for common characteristics such as shared needs, common interests, similar lifestyles or even. Market segmentation assumes that the market for any product or service can be divided into submarkets or segments, in such way as a meaningful group of buyers, each.
It helps the firm divide the market into several segments or groups. The management can respond to meet changing market demand. Demographic segmentation is defined as a market segmentation method based on variables such as age, gender, income etc. Basic explanation of demographic segmentation with. Marketing possibilities of market segmentation based on geographic and demographic variables sasa veljkovic belgrade university. It helps the firm divide the market into several segments or groups, each having a common variable, and target each of these. Businesspeople or business travelers are one of the customers that marriott focus the most.
Instead of generalizing customers wants and needs by age or sex, you would classify their preferences based on the city, culture, and climate. Segmentation bases for marriotts hotels marketing essay. Market segmentation is the process of dividing a target market into smaller, more defined categories. The word demographic is derived from demography, meaning the study of population. Market segmentation demographics demographic segmentation consists of dividing the market into groups based on variables such as age, gender family size, income, occupation, education, religion, race and nationality. Demographic segmentation consists of demographic factors such as age. International market segmentation across product categories. Apple inc report contains a full analysis of apple segmentation, targeting and positioning and apple marketing strategy in general. Basically, market segment action is the process of splitting an overall market into two or more groups of consumers.
Demographic segmentation is market segmentation according to age, race, religion, gender, family size, ethnicity, income, and education. Demographic segmentation consists of demographic factors such as age, ethnicity, nationality, occupation, etc. It is important to segment your market because different groups of consumers have different needs based on their varying demographics. Demographic segmentation almost always plays some role in a segmentation strategy.
International market segmentation across product categories four decades ago, wind and douglas 1972 declared the application of market segmentation to be as relevant internationally as in domestic markets. In the section of the market segmentation process the different types of market segmentation and the variables of each type will first be explained. Depending on the level of competition in the product market, segmentation is the natural response of marketers to deal with the situation in market. Geographic segmentation can be classified by parameters like countries, states, cities, villages, urban rural, climatic conditions, density of population. Segmentation, demographic, psychographic and behavioral. Demographic segmentation is market segmentation based on various demographic factors, like age, gender, social class, etc. Market segmentation, customer satisfaction, commercial bank. This type of segmentation helps to reach out to customers living in a similar region or area and have. After completing this chapter, student should be able to understand. Some brands are targeted only to women, others only to men. A survey gives you a better picture of the product from the customer perspective.
Most companies use it to get the right population in using their products. Pdf pharmaceutical marketing segmentation in the age of. These types are significant when identifying the right target customers to a product. The demographic segmentation is often used in market segmentation for the reason that the variables. Marketing segmentation strategies can be cultivated through an extensive choice of attributes found among purchasers.
Market segmentation wharton faculty platform university of. Time segmentation is less common, but can be highly. Market segmentation is a much broader concept, however, and it pervades the practice of business throughout the world. American journal of business education june 2011 volume 4. Market segmentation market segmentation is the division of a market into different groups of customers with distinctly similar needs and productservice requirements. Demographic market segmentation splits the market into different demographic categories, like age, race, nationality, religion, gender, marital status, social class, ethnicity, income, occupation, lifestyle, and education. This segmentation helps organizations understand consumer behavior accurately that in turn helps them perform better. As a result, you will get higher response rates, avoid less profitable areas, and invest your resources more wisely. This demographic market analysis can assist with two main objectives. Market segmentation survey expertmade survey and template.
The partition allows companies to identify a target market and generalize the needs of the consumers based on their group. Demographic segmentation divides the market on the basis of demographic variables like age, gender, marital status, family size, income, religion, race, occupation, nationality, etc. It focuses on the definition, basis of market segmentation and issues related to market segmentation in detail. This is one of the most common segmentation practice among marketers.
Geographic segmentation definition, importance, advantages. A study on market segmentation of samsung electronics ltd. As you might expect, demographic segmentation variables are amongst the most popular bases for segmenting customer groups. Tapestry gives you insights to help you identify your best customers, optimal sites, and underserved markets.
The geographic segmentation used when the marketers segment the market by focusing on a specific geographic area thomas, 2007, demographic segmentation concentrates on gender, age. Gender, age, income, housing type, and education level are common demographic variables. Demographic segmentation examples include age, gender, income, religion, race and nationality. Market segmentation and target marketing pearson canada. Market segmentation bases for segmenting consumer markets geographic demographic age, gender, family size and life cycle, or income psychographic social class, lifestyle, or personality behavioural occasions, benefits sought, user status, usage rate, loyalty nations, states, regions or cities. Market segmentation is the tool of choice for identifying and influencing target groups and this paper explores the implications of the internet for segmentation. These needs are what will drive your integrated marketing strategy. The rationale behind marketing segmentation is to allow businesses to focus on.
Historically, marketers segment the market accord ing to characteristics e. Demographic segmentation is the market segmentation strategy in which the total market is divided on the basis of customer demographics. Why it should be implemented recommendations 15 use benefit segmentation to market specific products to the customer 15 use geographic segmentation to market to a specific area 16 use psychographic segmentation to market to a. Therefore, with these variables in mind, an organization can choose which consumer they will accommodate. Well address the development of market segmentation, how it serves as the foundation of a marketing strategy, the types of segmentation to consider and the process of developing a market segmentation strategy. According to that the concept of market segmentation will be illustrated in the following manner.