Market Segmentation

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MARKET SEGMENTATION:

MARKET SEGMENTATION Prof Prashant Kumar Gupta Jain College Of MBA and MCA

Segmenting Consumer Markets:

Segmenting Consumer Markets

Geographic Segmentation:

Dividing markets into geographic units like nation, cities, region, neighbourhood, etc. Its important in India because of the variation in preferences and habits across different regions; rural and urban areas being major segments Product penetration, infrastructure, income levels etc. make segmentation more important and complex Geographic Segmentation Case:- Arid regions of Rajasthan and Gujrat , during summers, coolers are used because the weather is dry However they may be ineffective in Goa or Kerela because of humid weather, ACs might be preferred here

Demographic Segmentation:

Demographic Segmentation AGE Wants and Needs change with age and life cycle Eg : Hindustan Lever introduced pink coloured Pears soap for kids LIFE STAGE Different requirements at different life stages Marketers can meet different concerns with specific products and services GENDER Attitude and behavioral difference Research has fond out that men need to be invited to touch the product while women just pick them up Gender differentiation has long been applied to clothing, hair style, cosmetics, magazines, etc. INCOME Defines ability to participate in exchange However not a very preferred segment as two people with same income can have different lifestyle, attitude and values However Indian scenario is a bit different in terms of products like washing powder, cosmetics, etc. GENERATION Influenced by time in which he grows Overall have same cultural, political and economic conditions SOCIAL CLASS Have strong influence on preferences in cars,, clothing, home, furnishings, etc. Unique system peculiar to India

Psychographic Segmentation:

Psychographics is the science of using psychology and demographics to better understand consumers Segmented on the basis of psychological/personality traits, lifestyle or values Values and lifestyles significantly affect the product and brand choices Religion has significant affect Eg : McDonald’s struck off beef from its offerings in India Psychographic Segmentation

Psychographic Segmentation :VALS:

SRI Consulting Business Intelligence (SRIC-BI) gave this most popular classification system . Based on responses to a questionnaire featuring 4 demographics and 35 attitudinal questions Updated every year with data from 4,000 questionnaires Psychographic Segmentation :VALS

VALS :Tendencies of groups with higher resources:

VALS :Tendencies of groups with higher resources

VALS :Tendencies of groups with lower resources:

VALS :Tendencies of groups with lower resources

Behavioural Segmentations:

Divided into groups based on their knowledge of, attitude towards, use of, or response to a product Decision Roles: Initiator Influencer Decider Buyer User Behavioural Variables: Occasion Benefits User Status Usage Rate Loyalty Stage Attitude Behavioural Segmentations

Behavioural Variables:

Behavioural Variables OCCASION Can be defined in terms of time of day, week, etc or events in a consumer’s life BENEFITS Classified as per benefits consumers seek Same product with different benfits like Clinic All Clear and Sunsilk USER STATUS Classified as ex-users, potential users, first time users or regular users USAGE RATE Light, medium and heavy product users Heavy users might be less in number but have significant share in consumption LOYALTY STATUS Hard Core Loyals : One brand all the time Identify strength Split Loyals : Loyal to 2-3 brands Find competitive products Shifting Loyals : Shift from one brand to another Find Weakness Switchers : Show no loyalty ATTITUDE Enthusiastic, postive , indifferent and negative

Segmenting Business Markets:

Demographic Industry: Which Industry to serve? Company Size: What size companies should be served? Location: What geographical areas to serve? Operating Variables Technology: What customer technology should be focused? User Status: Heavy, medium, light users or non-users? Situational Factors Urgency: Serve companies which need sudden/quick service? Specific Application: Certain or all applications Segmenting Business Markets Purchasing Approaches Purchasing-Function Organisation: Centralised or decentralised purchasing organisations? Power Structure: Engineering dominated, Finance dominated and so on…. Nature of existing companies: Serve companies with strong relationship or desirable companies? Purchasing criteria: Companies seeking quality or price or service? Personal Characteristics Buyer-Seller Similarity: Serve those with similar values like us? Attitude towards risk: Risk taking or Risk-avoiding firms? Loyalty: Serve companies which show loyalty to suppliers?

Effective Segmentation Criteria:

Measurable Substantial Accessible Differentiable Actionable Effective Segmentation Criteria

Home Work:

Find what is conversion model (Attitude) Home Work

THANK YOU…!:

THANK YOU…!

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