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Accessible
The segment should be accessible through existing
network of people at affordable cost
Differentiable
The segments are different from each other and
require different 4Ps and programs
Actionable
The segments which a company wishes to pursue
must be actionable in the sense that there should be
sufficient finance, personnel and capability to take
them all
The Process of Market Segmentation
Identify the
existing and
future wants in
the current
market
The Process of Market Segmentation
lifestyle or behavior
The Process of Market Segmentation –
Examine the attributes
The process of market segmentation
3. Evaluate the proposed segment attractiveness on
the basis of measurability, accessibility and size
Segments selected in second steps should be
evaluated against the requisites, ie.
Measurability, accessibility, substantial,
actionable and differentiability
Proposed segment attractiveness
Bases of Segmenting Consumer Markets
Geographic
Segmentation
CONSUMER
Psychographic MARKET Demographic
Segmentation SEGMENTATION Segmentation
Behavioral
Segmentation
Bases of Segmentation
Bases of Segmentation
1. Geographic Segmentation
Dividing the market into different geographical
units such as nations, states, regions, cities or
neighborhoods
The company can operate in one or a few
geographic areas or operate in all buy pay
attention to local variations
Bases of segmentation
Bases of segmentation
Demographic Segmentation
In demographic segmentation the market is
divided into groups on the basis of variables
such as age, family size, family life-cycle,
gender, income, occupation, education, religion,
race, generation, nationality and social class
This is the most popular bases for distinguishing
customer groups
One of the major reason is that consumers’
wants, preferences and usage rates are often
associated with demographic variables
Bases of segmentation
Some of the demographic variables are:
A. AGE & LIFE-CYCLE STAGE
On the basis of age, a market can be divided into
a. Occasions
According to occasions, buyers develop a need,
purchase a product or use a product
A company should consider critical life events to see
whether they are accompanied by certain need
Bases of Segmentation - Occasion
Bases of Segmentation - Occasion
Bases of Segmentation
b. Benefits
Buyers can be classified according to the benefits
e. Loyal Status
Consumers have varying degree of loyalty to specific brands, stores
and other entities. Buyer can be divided into four groups according
to brand loyalty status:
Hardcore Loyals – Consumers who buy one brand all the time
Split Loyals: Consumers who are loyal to two or three brands
Shifting Loyals: Consumers who shift from one brand to another
Switchers : Consumers who show no loyalty to any brand. When there is
a low involvement and few significant perceived brand differences,
consumer try to purchase different brands in the category
Bases of Segmentation –Loyal Status
Hardcore Loyal
Bases of Segmentation –Loyal Status
Split Loyals
Bases of Segmentation –Loyal Status
Shifting Loyals
Bases of Segmentation –Loyal Status
Switchers
Bases of Segmentation
f. Buyer-Readiness Stage
A market consists of people in different stages of
1. Under Positioning
Some companies discover that buyers have only a vague idea of the brand. The
brand is seen as just another entry in a crowded market place
2. Over-positioning
Buyers may have too narrow image of the brand
3.Confused Positioning
Buyers might have a confused image of the brand resulting from the company’s
too many claims or changing the brand’s positioning too frequently
4.Doubtful Positioning
Buyers may find it hard to believe the brand claims in view of the product’s
features, price or manufacturer
Positioning Maps
Is a two dimensional graph of how a product, brand or
company is perceived versus competition
These maps are drawn on important buying dimensions
of consumer for company products as well as
competitors products
Construction of Position Map
Evaluate the buying dimension of customer
Select two buying dimensions of consumer - Eg. Price and
quality
Identify the relative market share
Draw the circles according to relative market share on two
dimension graph
Positioning Maps for soaps
Cosmetics
Godrej No:1
Lifebuoy
Santoor
Low price High Price
Ayurvedic
Bases of Positioning the Product
The bases for positioning strategies are:
1. Attribute Positioning:
A company positions itself on an attribute such as
benefit
3. Use or Application Positioning
Positioning the product as best for use
Bases of Positioning the Product
4. User Positioning
Positioning the product as best for some user group
5. Competitor Positioning
The product claims to be better in some way than a
particular competitor
6. Product Category Positioning
The product is positioned as the leader in a certain
product category
7. Quality or Price Positioning
The product is positioned as offering the best value