MARKET SEGMENTATION

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MARKET SEGMENTATION

• BY- SUNIT KUMAR MISHRA

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• CONCEPT AND DEFINITION
• The concept of market segment is based on the
  fact that the market of commodities are not
  homogeneous but they are heterogeneous. Market
  represent a group of customer having common
  characteristics but two customer are never common
  in their nature, habits, hobbies income and
  purchasing techniques.

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• According to Philip kotler , Market
  segmentation is sub-dividing a market into
  distinct and homogeneous subgroups of customers,
  where any group can conceivably be selected as a
  target market to be met with distinct marketing
  mix.

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• Market Segmentation is a method of dividing a
  market (Large) into smaller groupings of
  consumers or organisations in which each segment
  has a common characteristic such as needs or
  behaviour.

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Henry Ford epitomized this strategy when he
offered the Model- T Ford in one colour , black.
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LEVELS OF MARKET SEGMENTATION
SEGMENT MARKETING
NICHES MARKETING
LOCAL MARKETING
INDIVIDUALS MARKETING
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1. SEGMENT MARKETING
Consists of a group of customers who share a
similar set of needs and wants.

• Identifiable Group with in a Market with Similar
• Wants
• Purchasing Power
• Geographical Location
• Buying Attitudes

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FLEXIBLE MARKET OFFERING

• Even in segments 100 needs are not same
  consists of two parts
• Naked Solution - products and services that all
  members of the segment values.
• Discretionary options - that some segment
  members value. Each option might carry an
  additional charge.
• Example Automobile industry basic model is
  same but for A.C , power steering, power window
  buyer

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• has to pay extra price.
• Delta Airlines offers all economy passengers a
  seat and soft drinks. It charges economy
  passengers extra for alcoholic beverages.

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• Market Segments can be defined in many different
  ways. One way to carve up a market is to identify
  Preference segments
• Suppose ice cream buyers are asked how much they
  value sweetness and creaminess as two product
  attributes. Three different patterns can emerge.

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• Homogeneous preference
• where all the consumer have roughly the same
  preferences.
• We would predict that existing brand would be
  similar and cluster around the middle of the
  scale in both sweetness and creaminess.
• Diffused preference
• consumers vary greatly in their preferences
• Clustered preference

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creaminess
sweetness
Homogeneous Preference -no natural segments
-all buyers have same preference
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creaminess
sweetness
Diffused Preference -no pattern (or poor
research) -take center position
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creaminess
sweetness
Clustered Preference -natural segments
-increases as number of competitors increases
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2. NICHE MARKETING

• Group of customers seeking a distinctive mix of
  benefits who are ready to pay extra premium.
• Niche segment sub segments
• Eg. Washing detergents hard
  gentle washes . Surf excel for tough stains (
  hard on clothes) Ezee from Godrej for delicate
  clothes.
• --- Astha , Sanskar , Q TV focus on religion
  spiritualism.
• DISTINCT NEEDS
• PAY PREMIUM
• SPECIALIZATION
• LESS COMPETITION
• POTENTIAL

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ROLLS ROYCE
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3. LOCAL MARKETING

• Marketing programs tailored to the needs wants
  of local customer groups in trading areas,
  neighborhoods , etc.
• this trend is called grass roots marketing.
• Ex. Spiderman 3 was released in 5 different
  language in India including bhojpuri.

Chitle
Pune sarees
Kashmiri silk
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4. INDIVIDUAL MARKETING

• Ultimate segmentation segments of 1 or
  customized marketing or one to one marketing.
• Customerization empower the consumers to
  design the product or service offering of their
  choice.
• Ex. Paint companies have started doing this-
  Asian Paint , Nerolac , Berger Paints
• Arvind mills launched Ruffn Tuff Jeans, branded
  ready to stitch

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GEOGRAPHIC SEGMENTATION

• Divide the market into different group based on
  
• Region South India , North , Western Region,
  East
• City metro cities, cities with population more
  than 1 million
• World
• Density
• Climate
• States
• Ex.- Mcdonalds globally, sell burgers aimed at
  local markets, for example, burgers are made from
  lamb in India rather then beef because of
  religious issues. In Mexico more chilli sauce is
  added and so on.

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DEMOGRAPHIC SEGMENTATION
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As people age their needs and wants change, some
organisations develop specific products aimed at
particular age groups for example  nappies for
babies, toys for children, clothes for teenagers
and so on.    Gender segmentation is commonly
used within the cosmetics, clothing and magazine
industry. In the UK we have also seen the
introduction of Maxim, (www.maxim-magazine.co.uk) 
a male lifestyle magazine covering male fashion,
films, cars, sports and technology. \
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•  
• Income segmentation is another strategy used by
  many organisations. Stores like Harrods, Harvey
  Nicohals are predominantly aimed at the affluent
  market. Daewoo aim their vehicles at price
  sensitive buyers who require a bundle of benefits
  for the price. In today's globally competitive
  environment brands are specifically developed and
  positioned within particular income segments
  inorder to maximise turnover.
• Products and services are also aimed at
  different lifecycle segments. Holidays are
  developed for families, the 18-30's singles,  and
  for those in their 50's.      

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PSYCHOGRAPHIC SEGMENTATION
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• Lifestyle groups
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• Yuppie Associations
• Mobile
• High valued house/flat
• Good Salary
• Young branded car.
• Third Agers Associations.
• 50's
• Retired early from profession.
• Time to spare
• Adventure Seekers

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BEHAVIOURAL SEGMENTATION
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• OCCASIONS - Archies and Hallmark cards,
  Monaco at tea time.
• BENEFITS Shampoo for hair conditioning,
  cleaning , hair fall defence dandruff control
• USER STATUS- light medium heavy user
• LOYALTY STATUS- hardcore loyal , split loyal-
  loyal to 2-3 brand ,shifting loyal, switcher