Market segmentation involves dividing a large market into smaller subgroups with distinct needs, behaviors, or other attributes. There are several levels of market segmentation including segment marketing, niche marketing, and local marketing. Segmentation is important because it allows companies to better understand customer needs and satisfy them through tailored offerings. Common bases for segmentation include geography, demographics, psychographics, behaviors, and other variables. The document then provides details on various segmentation approaches for both consumer and industrial markets.

1. Market
Segmentation
Presented By:
Patel Chintan
10/13/2014
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2. Definition
 Market Segmentation is a method of
“dividing a market (Large) into smaller
groupings of consumers or organizations
in which each segment has a common
characteristic such as needs or behavior.”
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3. Level Of Market Segmentation
Segment Marketing
Niche Marketing
Local Marketing
Geographic segmentation
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4. The Need For Marketing
Segmentation
 The marketing concept calls for
understanding customer and satisfying
there needs better than the competition.
 Different customers have different needs,
and its rarely possible to satisfy all the
customers by treating them alike.
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5.  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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6.  Niche Marketing
 A Niche is a narrowly defined group of customers
seeking unique solution. Niche segment consists
of buyers with high purchasing power, who have
unique needs and strong motivation to fulfill their
needs.(Ex:Ezee)
 Local Marketing
 It is done to satisfy the needs of local people.
 For example : Spiderman movie was released in
India in different languages.
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7.  Individual Marketing
 It is also known as “One to one marketing”.
 It is used to satisfy the individual needs of
customers.
 (For Example: Asian and Nerolac paints allow
customers to mix and match the colours of their
choice.)
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8. Criteria For Market
Segmentation
 Indefinable: the differentiating attributes of the
segments must be measurable so they can be
identified.
 Accessible: the segments must be reachable
through communication and distribution
channels.
 Unique needs: to justify separate offerings, the
segments must respond differently to different
marketing mixes.
 Substantial: the segments should be sufficiently
large to justify the resources required to target
them.
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 Durable: the segments should be relatively
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9. Market Segmentation
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Consumer market Industrial market
 Geographic
 Demographic
 Psychographic
 Behavioral
 Demographic
 Operational variables
 Purchasing
approaches
 Situational factors
 Personal
characteristics
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10. Geographic segmentation
 Regions: by continent, country, state
or even neighborhood
 Size of the area: segmented
according to size of population
 Population density: often classified
as urban, suburban, or rural
 Climate: according to weather
patterns common to certain
geographic regions
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11. Demographic segmentation
 Demographic segmentation consists of
dividing the market into groups based on
variables such as:
 Age
 Gender
 Income
 Social class
 Life style
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12.  Age : Marketers design, package and promote
products differently to meet the wants of
different age groups.
 Good examples include the marketing of toothpaste
(contrast the branding of toothpaste for children and
adults) and toys (with many age-based segments).
 Gender: Gender segmentation is widely used
in consumer marketing.
 The best examples include clothing, hairdressing,
magazines and toiletries and cosmetics.
 Income: Many companies target affluent
consumers with luxury goods and convenience
services.
 Good examples include Coutts bank; Moet & Chandon
champagne and Elegant Resorts - an up-market travel
company.
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13.  Lifestyle: Marketers are increasingly
interested in the effect of consumer "lifestyles"
on demand. Unfortunately, there are many
different lifestyle categorization systems, many
of them designed by advertising and marketing
agencies as a way of winning new marketing
clients and campaigns.
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14. Psychographic segmentation
 Psychographic segmentation groups
customers according to their lifestyle.
Activities, interest, and opinions (AIO) surveys
are one tool for measuring lifestyle.
 Activities
 Interest
 Opinion
 Values
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15. Behavioral Segmentation
 Behavioral segmentation is based on actual
customer behavior towards products. Some
behavioralistic variable include:
 Opinions, interests and hobbies
 Degree of loyalty
 Occasions
 Benefits sought
 Usage
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16.  Opinions, interests and hobbies – this
covers a huge area and includes consumers’
political opinions, views on the environment,
sporting and recreational activities and arts and
cultural issues.
 Degree of loyalty – customers who buy one
brand either all or most of the time are valuable
to firms.
 Occasions – this segments on the basis
of when a product is purchased or consumed.
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17. Industrial base segmentation
Demographic
Industry
Company size
Location
 Operating variables
Technology
User status
Customer
capabilities
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18. Industrial base segmentation
Purchasing approaches
Purchasing function
organization(Centralized or
decentralized)
Power structure(engineering
dominated or financially dominated
Nature of existing relationship
Purchasing criteria(Quality,
price,service) 10/13/2014
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19. Industrial base segmentation
 Situational factors
Urgency
Specific application
Size of order
 Personal characteristics
Buyers &sellers similarities
Attitude towards risk
loyalty
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20. Thank You…
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