Market Segmentation Strategies

Hi Everyone,
How a market is segmented is based on variables used for segmentation; behavioral, demographic, psychographic and geographical differences.

1. Behavioral Segmentation :

Behavioral segmentation is based on the customer's needs and subsequent reaction to those needs or toward the purchase of intended products and/or services. This study is conducted on all variables that are closely related to the product itself, like loyalty to a particular brand, cost-effectiveness in terms of benefits and usage, circumstances responsible for the purchase, whether the customer is a regular, a first timer or and has the potential to become a customer, and whether the readiness to buy is linked to status.

2. Demographic Segmentation :

Demographic segmentation refers to a wide study of the potential customers. While marketing a product many variables like age, gender, education, income, size of the family, occupation, socioeconomic status, culture and religion, language and nationality are taken into account. There are many instances where such a segmentation has worked very profitably, toys and clothes for every age group, certain food products that do well in certain counties and don't in some, either due to cultural or religious reasons. Demographic segmentation plays a vital role in determining whether a product can be mass marketed or designed for specific clientèle.

3. Psychographic Segmentation :

Segmenting people according to their lifestyles and values, and how they translate into consumption or purchases of products of services is what psychographic segmentation is all about. How one's interest, opinions, values, attitude and the activities they perform, all affects how and why a group of people would lean towards one product more than others. A high status would translate into an expensive flying habit, while a thrift value will translate into an economy flight.

4. Geographical Segmentation :

Geographical segmentation is done by dividing people (markets) into different geographical locations. The country, state, or neighborhood, the king of gentry, climate, size of a place segmented into size of its age wise population, etc. all play a role in devising market strategies. This helps the producer and the marketers to understand what will sell and what won't, for example, a market for winter wear would definitely not work in warm regions.