1. Market Segmentation
With a large country
Many different types of people
- it is too difficult to create a product that will satisfy
everybody, that is why we focus on a segment of
the total market

2. Market Segmentation Defn
“Grouping people according to their similarity
related to a particular product category”

3. Market Segmentation
Characteristics
age
gender
geographic location
income
spending patterns
cultural background
demographics
marital status
education
language
mobility

4. Market Segmentation
4 commonly used bases for Segmentation
Descriptive
geographic location
demographic
Behavioural
psychographic
benefits

5. Basis for Market SegmentationSlide 3-7

6. Market Segmentation
geographic location - based upon where people live[ a
popular way of dividing markets)
demographic - based upon age, gender and income level
(very often used)

7. Market Segmentation
Psychographic / lifestyles - based on
people’s opinions, interests, lifestyles
benefits - based on the different expectation that
customers have about what a product/service can
do for them

8. Geographic Segmentation
The reason why we study geographic segmentation is
because WHERE people live has a big effect on their
consumption patterns.

9. Demographic Segmentation
Demographic Segmentation is the most common
approach to Market Segmentation
Variables are:
• age
• gender (male/female)
• income
• occupation
• education
• household (family - style) size

10. Demographic Segmentation
Demographic Segmentation is the most common
approach to Market Segmentation
Variables are:
• gender (male/female)gender (male/female)
•gender is an obvious way to divide the market into
segments since so many products are gender-specific
• clothing
• medical products
• sports products/services
• entertainment Examples ??

11. Demographic Segmentation
Demographic Segmentation is the most common
approach to Market Segmentation
Variables are:
age
• age is another obvious way to divide the market into
segments since so many products are based upon
“time of life”
Examples ??

12. Demographic Segmentation
age
• also, people have different consumption patterns at
different ages
Examples ??

13. Demographic Segmentation
Demographic Segmentation is the most common
approach to Market Segmentation
• Segmenting by the “stages in the family life cycle
• There are different buying characteristics of people
in each stage of the family

14. Demographic Segmentation
•household (family - style) size
BUYING PATTERNS
• 0-5 young children
• 6-19 school children
• 20-34 young adults
• 35-49 younger middle-aged
• 50-64 older middle-aged
• 65+ seniors
• 80+ SUPER seniors

15. Demographic Segmentation
•household (family - style) size
FAMILY LIFE CYCLE STAGES
a. Young Single
b. Young Married with no Children
c. Young - married with children

16. Demographic Segmentation
•household (family - style) size
FAMILY LIFE
c. married with children
d. divorced with children
e. married without dependent children
f. divorced without dependent children

17. Demographic Segmentation
•household (family - style) size
FAMILY LIFE CYCLE STAGES
5. Older
a. older married
b. older unmarried (divorced, widowed)

18. Demographic Segmentation
Demographic Segmentation is the most common
approach to Market Segmentation
Variables are:
• age
• gender (male/female)
• income
• occupation
• education
• household (family - style) size

19. Demographic Segmentation
income
Segmenting markets on the basis of income and
expenditure patterns

20. Psychographic Segmentation
“The use of psychological attributes,
lifestyles and attitudes in determining
the behavioral profiles of different
customers”
The use of detailed information to understand
differences in what people buy
psychological

21. Psychographic Segmentation
Psychographic profiles on a target market segment are
obtained by doing a lot of questionnaires and surveys to
ask people if they agree/disagree with certain statements
made about particular activities, interests or opinions
AIO - activities, interests, and opinions

22. Benefit Segmentation
“It is based on the Attributes (characteristics) of
products, as seen by the customers”
example, people buy something because it
causes a benefit

23. Benefit Segmentation
“Many marketers now consider benefit
segmentation one of the most useful methods
of classifying markets”

24. Segmentation Bases for Industrial Markets
Slide 3-12
Segmentation for Industrial Markets

25. Geographic Segmentation
useful for the automotive industry
Product Segmentation
ie. Special parts and components
Segmentation by End-Use Application
ie. Paint mfg. Paint for waterproof applications,
paint for rust prevention, paint which sticks to glass
Segmentation for Industrial Markets

26. Pharmaceutical Segmentation
Pharmaceutical segmentation can be done for
four categories of products.
The first is for consumer or prescription
products. Second for Institutional market
products. Third, the Industrial market products
and finally OTC (Over the counter) or non
prescription products.

27. Pharmaceutical Segmentation
For pharmaceutical companies what is
important is the prescription markets.
pharmaceutical market for prescription can be
sub divided into two categories:
1. Doctors or Intermediate Customer
2. Patients or consumer

28. Pharmaceutical Segmentation
1. Segmentation on the bases of Intermediate customer
(Doctor):
Doctors can be classified on the basis of their a. Age (Old
Doctors, Young Docotrs, Interns), b. Speciality
(Cardiologists, Diabetologists, Orthopedician,
Opthalmologist etc.) c. Place of Practice (Urban, Rural,
Govt Hospitals, Private clinics)

29. Pharmaceutical Segmentation
) d. General Practitioners e. Type of Practice
(Prescribing/Dispensing) f. Usage rate of products (heavy
users, light users, medium users, non users)
A company need to look into so many factors because these
factors would help a company to effectively plan and decide
its marketing strategy.

30. Pharmaceutical Segmentation
2. Segmentation on the bases of consumers:
Patients can be categorized as
 a. Patients with similar kind of illness e.g..
diabetic patients b. Patients with similar stage
of illness (acute illness / chronic illness) c.
Patients according to their age group
(pediatric patients, geriatric patients, young
patients etc.) d. Patients according to their
gender (male and female patients)

31. Pharmaceutical Segmentation
Institutional market comprises of large
hospitals who purchase in bulk and directly
from the companies. Pharmaceutical
companies need to identify the profitable
hospitals on the basis of their size and how
much business they can generate. Some
companies have a separate department or
division to cater to the needs of institutional
market.
.

32. Pharmaceutical Segmentation
Industrial market comprise of buyers of bulk
drugs or active pharmaceutical ingredients. It
also includes pharmaceutical machinery
suppliers

33. Pharmaceutical Segmentation
OTC market includes consumer who
purchases certain medicines that do not
require a prescription from doctor.