Segmentation

The theory of market segmentation was create by Henry J. Claycamp and William F. Massy in a
journal article in November 1968. Segmentation means to divide the marketplace into several
parts, or groups that will be definable, accessible, responding, and profitable and have a growth
potential. In other words, an organization would find it impossible to target the whole market,
because of time, cost and the difference in customers’ needs and wants. It needs to have a
segment (group) - a mass of people who can be identified and targeted with reasonable effort,
cost and time. Many examples of segmentation was observed and they have been classified into
four main groups which are: Demographic segmentation, Geographic segmentation,
Psychographic segmentation, Behavioral segmentation.
Behavioral segmentation
Behavioral segmentation divide and target the customers according to their behaviors that they
exhibit according to (Last updated on June 14, 2019 by Stephanie Mialki in Marketing
Personalization). These behaviors include the types of products and services they consume and
how often they interact the business. Thus consumer decision making is affected by their
behavior and that is exactly how the behavioral segments are targeted. The best example of
behavioral segmentation by loyalty is observed in the hospitality segment where airlines, hotels,
restaurants and others give their best service to provide the most excellent experience possible
such that they can retain their customer. Except the behaviors of clients, their choices and
preferences also affect the behavioral segment.

Geographic segmentation
Geographic segmentation is defined as ‘involves selecting potential markets according to where
they are located’ (Mark Anthony Camilleri PhD, 2008, Market Segmentation, Targeting and
positioning). According to Mark Anthony segmentation approach may consider variables such as
climate, terrain, natural resources and population density, among other geographic variables.
Markets can be divided into regions because one or more of these variables could differentiate
customers from one region to the next. For instead, those individuals who are living in wet and
cold climates will prefer warm, sunny destinations for their holidays. This issue could greatly
affect competition among airlines for certain destinations, particularly during the peak holiday
seasons. The culture or country of origin of all travellers is also an important factor which must
be taken into consideration, particularly when targeting corporate segments.

Psychographic segmentation
Psychographic segmentation is where customers are grouped based on personality, traits, beliefs,
values and attitude, lifestyle (Barry, J.And Weinstein, 2009). Every customer have a different
psychographic make up. Analyzing and grouping different characteristics together is the start of
psychographic segmentation. Psychographic segment may include health conscious people
(lifestyle), people who prefer who prefer to look for quality over price, or people who buy only
original product (values)…\

Demographic segmentation
Demographic segmentation is defines as a market segmentation method based on age, gender,
income, education level, marital status, religion… .This segmentation helps organization
understand consumer more accurately. (January 11, 2019 By Hitesh Bhasin). According to the
research the demographic segmentation is the one segment that is mostly used by organizations.
This segment enable businesses to better understand the needs and wants of consumers. For
example based on gender the organization know that most women will purchase feminine items
on opposite to men.