Market Segmentation: Definition, Example, Types, Benefits
Meaning Of Marketing Segmentation – Introduction:
Marketing Segmentation is one of the most powerful concepts in the marketing toolbox. In this Article lets the Meaning of Marketing Segmentation, its benefits, types, steps involved and also Marketing Segmentation Example.
Definition Of Marketing Segmentation
Market segmentation strategy is an adaptive strategy. When dividing the market into smaller homogeneous groups based on geographic, demographic, psychographic or behavioral factors is called market segmentation. It consists of the operation of the market with the purpose of selecting one or more market segments which the organisation can target through the development of specific marketing mixes that adapt to particular market need.
Must Read: 12 LATEST STRATEGIES FOR MARKETING A PRODUCT
Meaning Of Marketing Segmentation
Before we see the meaning of marketing segmentation let’s see its most basic level, the term “market segmentation” refers to subdividing a market along some commonality, similarity, or kinship. That is, the members of a market segment share something in common. The purpose of segmentation is the concentration of marketing energy and force on the subdivision (or the market segment) to gain a competitive advantage within the segment.
Benefits Of Marketing Segmentation
- Market segmentation is customer-oriented. Marketer will identify the customer need and want then only decide if it is practical to develop marketing mix to satisfy those wants.
- The management can respond to meet changing market demand.
- Management can do a better marketing job.
- Develop strong positions in specialized market segment.
Must Read: IMPACT OF MARKETING ON SOCIETY
Steps in Market segmentation
- Select a market or product category for study
- Choose a basis or bases for segmenting the market
- Selecting segmentation descriptors
- Profile and analyze segments
- Select target markets
- Designing, implementing and maintaining appropriate marketing mixes
MUST READ: THE ROLE OF MARKETING IN STRATEGIC PLANNING
Definition of The Marketing Mix
- The Definition of the Marketing Mix comes from the activities of Marketing. Marketing involves a number of activities. To begin with, an organisation may decide on its target group of customers to be served. Once the target group is decided, the product is to be placed in the market by providing the appropriate product, price, distribution and also promotional efforts. These are to be combined or mixed in an appropriate proportion so as to achieve the marketing goal. Such mix of product, price, distribution and also promotional efforts is known as ‘Marketing Mix’.
- The term ‘Marketing Mix’ describes the set of controllable variables that the firm can use to influence the buyer’s response”. The controllable variables in this context refer to the 4 ‘P’s [product, price, place (distribution) and promotion]. Each firm strives to build up such a composition of 4‘P’s, which can create highest level of consumer satisfaction and at the same time meet its organizational objectives. Thus, this mix is assembled keeping in mind the needs of target customers, and it varies from one organisation to another depending upon its available resources and marketing objectives.
What is 4ps of marketing
- Product : Product refers to the goods and also services offered by the organization
- Price : Price is the amount charged for a product or service
- Place : Goods are produced to be sold to the consumers.
- Promotion : If the product is manufactured keeping the consumer needs in mind, is rightly priced and made available at outlets convenient to them but the consumer is not made aware about its price, features, availability etc, its marketing effort may not be successful.
Type of Marketing Segmentation
The following are the types of marketing segmentation
- Geographic
- Demographic
- Psychographic
- Behavioural
Marketing Segmentation Example
The following are various Marketing Segmentation Example
Geographic Segmentation:
This is perhaps the most common form of market segmentation, wherein companies segment the market by attacking a restricted geographic area. For example, corporations may choose to market their brands in certain countries, but not in others.
Geographic Marketing Segmentation Example include:
- Region: By Continent, Country, State or by neighbourhood also
- Size of metropolitan area: Segmented according to population size
- Population Density
- Lastly Climate
Demographic Segmentation:
Some brands are targeted only to women, others only to men. Music streaming services tend to be targeted to the young, while hearing aids are targeted to the elderly. Education levels often define market segments. For instance, private elementary schools might define their target market as highly educated households containing women of childbearing age. Demographic segmentation almost always plays some role in a segmentation strategy
Demographic Marketing Segmentation Example include:
- Age
- Gender
- Family Size
- Family Life Cycle
- Income
- Occupation
- Education
- Generation
- Ethnicity
- Nationality
- Religion
- Social Class
Psychographic Segmentation:
- Lastly, we come to psychographic (or lifestyle) segmentation, based upon multivariate analyses of consumer attitudes, values, behaviors, emotions, perceptions, beliefs, needs, benefits, wishes, and also interests. Psychographic segmentation is a legitimate way to segment a market, if we can identify the proper segmentation variables (or lifestyle statements, words, pictures, etc.)
- Qualitative research techniques (focus groups, depth interviews, ethnography) become invaluable at this stage. Qualitative research provides the insight, the conceptual knowledge and also the consumer’s exact language necessary to design the segmentation questionnaire.
- Typically, verbatim comments from consumers are used to build batteries of psychographic or lifestyle statements (these two terms are used interchangeably). A large representative sample of consumers (generally, 1,000 or more) are then asked about the degree to which they agree or disagree with each statement.
Psychographic Marketing Segmentation Example include:
- Interests
- Activities
- Opinions
- Values
- Attitudes
Behavioural Segmentation
Behavioural Segmentation is based on actual customer behaviour towards products. This systems are becoming increasingly important as a means of making the complexity of customer behaviour accessible to marketing planners.
Some Behavioural Marketing Segmentation Example include:
- Firstly Benefits Sought
- Usage Rate
- Brand Loyalty
- User Status
- Readiness to buy
- Lastly Occasions
Must Read: UNDERSTANDING CONSUMER BEHAVIOR
Uses of Behavioural Segmentation
- a comprehensible and actionable view of a complex customer base
- a framework within which marketing objectives and strategies can be more potently derived
- a basis for measuring and tracking marketing effectiveness.
Conclusion:
Thus, understanding Meaning of Marketing Segmentation is crucial in Marketing. It is one of the most powerful concepts in the marketing toolbox. It’s a chance to apply maximum pressure by concentrating marketing and advertising activities on a segment of the market to change human behavior; for example, persuade people to accept a new product, buy brand A over brand B, accept new taxes to protect the environment, or elect a new member of Congress. Segmentation permits intelligent focusing and also concentration of marketing effort to maximize returns on marketing investments.
LIKE WHAT YOU’RE READING?
CHECK OUT SOME OF OUR OTHER GREAT CONTENT HERE:
- MARKETING MANAGER ROLES AND RESPONSIBILITIES
- CONTENT MARKETING STRATEGIES FOR SMALL BUSINESSES
- DEFINITION OF MARKETING MANAGEMENT
- ROLE OF BLOGS IN MARKETING
- UNDERSTANDING DIGITAL MARKETING
- WHAT IS AFFILIATE MARKETING? (HOW TO GET STARTED)
- PERFORMANCE MARKETING – A BEGINNER’S GUIDE
- EFFECTIVE BRANDING METHODS
- UNDERSTANDING CONSUMER BEHAVIOR
- HOW TO INCREASE SALES?
- HOW AI IS USED IN DIGITAL MARKETING?
- 5 BEST SOCIAL MEDIA PLATFORMS FOR BUSINESS IN 2022
- WHAT IS THE DEFINITION OF ECOMMERCE
- ROLE OF SOCIAL MEDIA IN MARKETING
- WHAT IS ZERO-BASED BUDGETING
- DECODING DIRECT MARKETING WITH EXAMPLES
- 5 BEST TOOLS FOR DIRECT MARKETING WITH ADVANTAGES IN DETAIL
- 5 BEST MARKETING STRATEGY IN PRODUCT LIFE CYCLE FOR 2023
- 8 STRATEGIES OF RETAIL MARKETING TO DRIVE SALES
- WHAT IS THE IMPORTANCE OF MARKETING IN A BUSINESS?
- DEFINITION OF B2C MARKETING WITH EXAMPLE
7 Comments