MODULE 3 MARKET SEGMENTATION/TARGETING

14.1 BUYER SEGMENTATION

Markets can be segmented on the basis of buyer behavior as well since
all segmentations are in a way related to buyer behavior, one might be
tempted to ask why buyer behavior-based segmentation should be
studied as a separate method.
It is because there is some distinction between buyers characteristics
that are reflected by their geographic, demographic & psychographic
profiles & their buying behavior.
Marketers often find practical benefit in using buying behavior as a
separate segmentation base in addition to bases like geographics,
demographics & psychographics.
The primary idea in buyer behavior segmentation is that different
customer groups expect different benefits from the same product &
accordingly, they will be different in their motives in owning it & their
behavior in buying it.
In buyer behavior-based segmentation too, several sub-factors can be
tried as bases. For ex, purchase occasion can be one base; buyers can be
segmented on the basis of whether they are regular buyers, or special
occasion buyers; and the latter can be divided further, based on the
particular occasion on which they buy the products.
Degree of use can be another base; buyers can be segmented for ex, on
the basis of whether they are light or medium or heavy users of the
product.
Buyers attitude towards the product can be yet another base; buyers
can be segmented for ex, on the basis of whether they are enthusiastic or
indifferent or negative in their attitude to the product.

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14.2 BUYER SEGMENTATION
Segmentation Based on Benefit Expected + Income level TITAN WATCHES
After carrying out an in-depth market study, Titan identified 3 distinct
segments for its watches.
The segments were arrived at using essentially benefit & income level as
the bases.
The 1st consisted of the high income/elite consumers who were buying a
watch as a fashion accessory & not as a mere instrument showing time.
They were also willing to buy a watch on impulse. The price tag did not
matter much to this segment.
The 2nd segment consisted of consumers who preferred some fashion in
their watches but to them price did matter. While they had the capacity
to pay the price required for a good watch, they would not purchase a
watch without comparing the various offers in the market.
The 3rd segment consisted of the lower-income consumers who saw a
watch mainly as a time keeping device & bought mainly on the basis of
price.
For the 1st segment, Titan offered AURUM & ROYALE in the
gold/jewellery watch range. They were stylish dress watches in all gold
& precious metals. The prices ranged from Rs 20K & 100K.
For the 2nd segment, Titan offered the EXACTA range in stainless steel,
aimed at withstanding the rigors of daily life. There were 100 different
models in the range. The price range was Rs 500-700. Titan also offered
the RAGA range for women in this segment.
And, for the 3rd segment, Titan first offered the TIMEX watches & later,
when the arrangement with Timex was terminated, the SONATTA
range. The price range of Timex watches was Rs 350-500. It was offered
in 200 different models. The SONATTA range too was low priced. Titan
also offered the DASH range for the children.
In-depth segmentation helped Titan launch segment-specific products.
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14.3 BENEFIT SEGMENTATION
Benefit too can form a base for segmentation. Since buyers are very
heterogeneous in the benefits they prefer in a product, benefit serves
as an effective base for segmentation. Buyer behavior segmentation too
relies on benefit.
In fact, it will be appropriate to consider buyer behavior segmentation
as a close cousin of benefit segmentation. After completing segmentation
with various other bases, marketers may want to probe further & find
out whether the segments can be broken down into even more
homogenous sub-segments.
Usually, such a probe leads to segmentation by benefit. Through
benefit segmentation, one often gains an opening for a further
disadvantage of the consumers.
Segmentation Based on Buying Behavior/Benefit/Use Pattern AMBASSADOR CAR

Car manufacturers in India had segmented the market, using the

demographic factor of purchasing capacity/price preference & the
psychographic characteristic of lifestyle as the bases. Continuing with
the example of passenger car, the approach of Hindustan Motors (HM)
in segmenting market on basis of buyers buying behavior/use pattern.
The 1990s was a time when many new trends were emerging in the
buying behavior of car buyers in India. The availability-led buying
behavior that prevailed prior to 1990 was now giving way to a use
pattern-led buying behavior.
And, it was in this context that HM opted to segment the market based
on use pattern & offer specific products/models to specific segments,
meeting their specific use pattern.

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14.4 ANALYSIS OF HMS APPROACH