Marketing segmentation, Needs , Basics of segmentation

Marketing segmentation

1. Market
Segmentation
BY
K PRUTHVI RAJ CHAVAN
MBA,PGDFM,PGDMM,[PH.D]

2. Market Segmentation: MEANING
•Market segmentation is a marketing term that refers
to aggregating prospective buyers into groupsor
segments with common needs and who respond
similarly to a marketing action.
•Market segmentation enables companies to target
different categories of consumers who perceive
thefull valueof certain products and services
differently from one another.

3. Market Segmentation: MEANING
•Market segmentation allows a company to increase
its overall efficiency by focusing limited resources
on efforts that produce the best return on
investment (ROI).
•Market segmentation is an extension of market
research that seeks to identify targeted groups of
consumers to tailor products andbrandingin a way
that isattractive to the group.

4. Need for Market Segmentation
•It helps the marketers to devise appropriate
marketing strategies and promotional schemes
•To understand the needs of the target audience and
adopt specific marketing plans
•Results in focused approach
•Gives the customers a clear view of what to buy
and what not to buy
•Helps the organizations to target the right product
to the right customers at the right time

5. Need for Market Segmentation
•It classifies consumers according to their locations,
tastes & preferences.
•helps the organizations to know and understand
their customers better
•It can now reach a wider audience and promote
their products more effectively
•Helps to target their target audience.

6. BASES FOR MARKET SEGMENTATION
•Geographic Segmentation
•Demographic Segmentation
•Psychographic Segmentation
•Behaviouristic Segmentation
•Volume Segmentation
•Product-space Segmentation
•Benefit Segmentation.

7. BASES FOR MARKET SEGMENTATION

8. BASES FOR MARKET SEGMENTATION
•Geographic Segmentation:
•Geographic location is one of the simplest methods of
segmenting the market. People living in one region of the
country have purchasing and consuming habit which differs
from those living in other regions. For example, life style
products sell very well in metro cities, e.g., Mumbai, Delhi,
Kolkata and Chennai but do not sell in small towns

11. •Demographic Segmentation:
•Demographic variables such as age, occupation,
education, sex and income are commonly used for
segmenting markets.
•Age
•Sex
•Occupation
•Industrial sector
•Trade
•Services
BASES FOR MARKET SEGMENTATION

14. •Psychographic Segmentation:
•Under this method consumers are classified into
market segments on the basis of their psychological
make-up, i.e., personality, attitude and lifestyle.
According to attitude towards life, people may be
classified as traditionalists, achievers, etc.
BASES FOR MARKET SEGMENTATION

16. •Behaviouristic Segmentation:
•In this method consumers are classified into market
segments not the basis of their knowledge, attitude
and use of actual products or product attributes.
•Types of behavioural segmentation
•Segmentation based on purchasing behavior. ...
•Occasion or timing-based segmentation. ...
•Benefits-sought segmentation. ...
•Segmentation based on customer loyalty. ...
•Segmentation based on buyer's journey stage. ...
•Segmentation based on user status.
BASES FOR MARKET SEGMENTATION

21. •Volume Segmentation:
•Consumers are classified light, medium and heavy
users of a product. In some cases, 80 per cent of
the product may be sold to only 20 per cent of the
group. Marketers can decide product features and
advertising strategies by finding common
characteristics among heavy users.
BASES FOR MARKET SEGMENTATION

22. •Product-space Segmentation:
•Here the buyers are asked to compare the existing
brands according to their perceived similarity and in
relation to their ideal brands. First, the analyst infers the
latent attributes that consumers are using to perceive
the brand. Then buyers are classified into groups each
having a distinct ideal brand in mind. The distinctive
characteristics of each group are ascertained.
BASES FOR MARKET SEGMENTATION

23. •Benefit Segmentation:
•Consumer behaviour depends more on the benefit
sought in product/service than on demographic factors.
Each market segment is identified by the major benefits
it is seeking. Most buyers seek as many benefits as
possible. However, the relative importance attached to
individual benefits differs from one group to another. For
example, some consumers of toothpaste give greater
importance to freshness while other prefer taste or
brightness of teeth.
BASES FOR MARKET SEGMENTATION

24. How to Create a Market Segment
•Define and Analyzethe Market
•Identify and Describe Potential Segments
•Select the Market Segmentation Techniques
•Research the Needs and Behaviour
•Craft the Campaign & Validate the Assumptions

25. Ways To Collect Data For Segmenting
Your Audience
•Survey Your Customer Base
•Customer Interviews
•Lower the Barrier to Entry
•Quizzes
•Facebook Audience Insights
•Hidden Interests
•DeeperData

26. Benefits of Market Segmentation
•Positioning to spot marketing opportunities.
•Allocation of marketing budgets
•Adjustment of marketing appeals
•To reach market expansion
•Better communication
•Increase profitability
•Identify new products
•Reduces costs
•Reduces credit risks
•To better make use of competitive advantage.

27. Criteria to select target Market
•It must be large enough to earn profit
•It must be measurable
•Stable in nature
•It is internally homogenous.
•Possible to reach potential customers
•It must respond consistently to a given market
stimulus.
•Market intervention in a cost effective manner
•Perfect composition of marketing mix
•Sales approach
•Market positioning

28. Requirements of Market Segmentation
•Identifiable
•Accessible‘
•Measurable
•Sustainable
•Unique needs
•Durable

29. Importance of market Segmentation
•Precise and Personalised Targeting
•Increased ROI
•Increased Competitiveness and Conversions
•Reduced Time and Money
•Better Relationships and Customer Retention

30. Market strategies
•The marketing strategy focusing on the target
audience is known as a target marketing strategy.
•Based on the response from the market, marketing
strategies are designed.
•The target marketing strategies vary based on the
purchasing power of the customer, and the
geographical location of the market.

31. Marketing Strategies
•Mass Marketing -Mass Marketing involves marketing to the
entire population with a single strategy. Mass marketing
focuses to reach everyone with maximum exposure to the
product. An attempt is made to spread the message to
everyone with mass media such as TV, newspaper, and
mobile.
•Segment Marketing -Segment Marketing known for its
differentiated targeting strategy focuses on a section of
people known as the ‘target audience’. The target marketing
concept is to attract customers to their products. This segment
of marketing fetches good results for new products entering to
market with established organizations. This differentiated
marketing is expensive

32. Marketing Strategies
•Niche Marketing -Niche marketing also known as
concentrated marketing targets a small section of
the market. The entire campaign is around this small
section of the market. Luxury goods like Rolex and
Armani are examples of niche marketing. Niche
marketing yields results for small companies with
limited production and sales. There are advantages
and disadvantages to niche marketing.

33. Marketing Strategies
•Micro Marketing -Micromarketing focuses on a
much smaller section of people than niche
marketing. Micromarketing definition is customized
marketing or one-to-one marketing. The products
are customized to the requirements of the
customer. The micro marketing strategies involve
customer tastes, whims, and wishes.

34. Marketing Strategies
•Local Marketing -Local marketing strategy involves
nearby and neighbourhood areas. The
organizations use this marketing strategy to thrive on
local connections and make their presence felt.