MARKET

SEGMENTATION
HOW IT HELPS IN ADVERTISING
WHAT IS IT
• The process of breaking of buyers
into groups that are different
from each other but internally
similar

• Applicable any marketing

situation - Business to business,
business to consumer, not-for-
profit, politics, etc.

• These groups are known as Target

Groups (TG) or Target Audience in
marketing lingo.
 Starts from the premise that all buyers
are not the same: profit/volume
potential, motivations, product uses,
needs and desires, etc.

WHY
Segmentation allows you to choose
SEGMENTATION which buyers to target and provides
important insights as to how to appeal
IS REQUIRED to them.

Significant competitive advantage

PROS AND CONS OF MARKET SEGMENTATION
• Pros:
• Gives a direction
• Helps Value Creation
• Competitive edge

• Cons:
• Limits business approach
• Lose out potential consumers
FACTORS CONSIDERED FOR MARKET SEGMENTATION

• age • cultural background

• gender • demographics
• geographic location • marital status
• income • education
• spending patterns • language
• mobility
 FOUR BASES OF SEGMENTATION

Descriptive Behavioural
Geographic location Psychographics
Demographics Benefits
BEHAVIOURAL
Psychographic / lifestyles -
• Based on people’s opinions,
interests, lifestyles
• e.g. people who like hard rock
music probably prefer beer to
wine
Benefits -
• Based on the different
expectation that customers have
about what a product/service can
do for them
• e.g. People who want to buy “lite”
food cause it will help them lose
weight
DESCRIPTIVE
• Geographic location
• Demographic Segmentation is the most
• The reason why we study
common approach to Market
geographic segmentation is
Segmentation
because WHERE people live has a
big effect on their consumption • age
patterns. • gender (male/female)
• Additionally, WHERE people live in • income
a city is also a reflection of their
• occupation
income level and we can make
certain assumptions about their • education
ABILITY TO SPEND. • household (family - style) size
• This helps people plan store
locations and the location of other
services.
DEMOGRAPHIC VARIABLE - AGE

• Age is an obvious way to divide the market into segments since so

many products are based upon “time of life”
• Examples -
• diapers for babies
• toys for children
• entertainment for “over 18”
DEMOGRAPHIC VARIABLE - GENDER
• Gender is another obvious way to divide the market into segments
since so many products are gender-specific
• Examples -
• Clothing
• Medical products
• Sports products/services
• Entertainment
 • Segmenting by the “stages in the family life cycle”
• There are different buying characteristics of people in
each stage of the family

DEMOGRAPHIC • BUYING PATTERNS

VARIABLE – • 0-5 - young children
• 6-19 - school children
HOUSEHOLD SIZE • 20-34 young adults
• 35-49 younger middle-aged
• 50-64 older middle-aged
• 65+ seniors
• 80+ SUPER seniors
 • Income is possibly the most common basis for
segmentation
• Upper High Class
High Class
Uper Middle Class
DEMOGRAPHIC Middle Class
Lower Middle Class
VARIABLE -
• Examples -
INCOME
• Hyundai Elantra / Aura – high end
• Hyundai i10
• Hyyundai eon

• HUL soaps - Dove for high end, Hamam

THANK YOU