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8
Identifying Market
Segments and Targets
 Fords Model T Followed a Mass
Market Approach

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 Effective Targeting Requires

Identify and profile distinct groups of buyers

who differ in their needs and preferences
Select one or more market segments to enter
Establish and communicate the distinctive
benefits of the market offering

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 What is a Market Segment?

A market segment consists of a group

of customers who share a similar set of
needs and wants.

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Segmenting Consumer Markets

Geographic

Demographic

Psychographic

Behavioral

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 Demographic Segmentation

Age and Life Cycle

Life Stage
Gender
Income
Generation
Social Class
Race & Culture
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 Behavioral Segmentation Based
on Needs and Benefits

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 Behavioral Segmentation:
Behavioral Variables

Occasions Buyer-Readiness
Loyalty Status
Benefits
Attitude
User Status
Usage Rate

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 Heavy and Light Users of Common
Consumer Products
LIGHT
PRODUCT (% HEAVY HALF
USERS) HALF
Soups and 75% 25%
detergents
(94%)
Toilet tissue (95%) 71% 29%
Shampoo 79% 21%
(94%)
Paper towels (90%) 75% 25%
Cake mix (74%) 83% 17%
Cola (67%) 83% 17%
Beer (41%) 87% 13%
Dog food (30%) 81% 19%
Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall 8-9
Bourbon (20%) 95% 5
 The Brand Funnel Illustrates
Variations in the
Buyer-Readiness Stage
Aware
Ever tried
Recent trial
Occasional user
Regular user
Most often used

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 Loyalty Status

Hard-core
Split loyals
Shifting loyals
Switchers

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 Figure 8.3 Behavioral
Segmentation Breakdown

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 Effective Segmentation Criteria

Measurable

Substantial

Accessible

Differentiable

Actionable

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Porters Five Forces Model
 Figure 8.4 Possible Levels
of Segmentation

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