Date: [Type here]

9-july-2022

Assignment#02
Amna Taimuri
20211-29725

Instructor

Syeda Dur-e-Afshan Ali

 Assignment # 02

In this review exercise, you need to demonstrate your understanding of the different consumer
segmentation bases.

Listed below is a number of firms and how they approach segmentation. You need to identify
what type of segmentation base that the firm is using (see list of segmentation bases at the
bottom and give rationale

Note: Sometimes more than one segmentation base in combination (that is, hybrid segmentation)
has been used.

How the Firm Defines its Target Market?

1.  A bank that markets home loans to young married people and financial planning services to

retired people.

2. A mobile phone company that targets people who frequently holiday in remote parts of the

world.

3. A gourmet cheese company that targets people buying cheese platters for a dinner party or

function.

4. Computer software firm that is most interested in households with a high level of software

purchases.

5. Prestige car manufacturers who highlight the status associated with owning one of their

vehicles.

6. Smart phone manufacturers targeting those consumers who are interested in purchasing their

first smart phone in the future.

7. A plumber deciding to do letterbox drops his local area.

8. A book publisher that specializes in children’s books.

9. A home-delivered spring water company advertising in a ‘health’ magazine.

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10. A travel package tour operator targeting retired people who want educational travel

experiences.

11. Choose from the following segmentation bases:

A= Geographic
B = Behavioral
C = Benefits
D = Demographic
E = Psychographic ( VALS)
F = Occasion/situation

Student Discussion Questions (discuss in detail all questions)

1. Identify the type of segmentation base being used by each firm. Provide rationale
2. Are there any examples above where the approach used could be classified as more than
one of the segmentation base options? If yes which one and why?
3. A number of the firms use hybrid segmentation, what would be the advantages of this
approach?
4. Do you think there is one best segmentation base that most firms should utilize? Why and
why not.

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Question:1 Identify the type of segmentation base being used by each firm. Provide
rationale?
1. A bank that markets home loans to young married people and financial planning
services to retired people.
This is an example of demographic segmentation as they targeted both age and income level
groups for home loans and financial planning services. The young married couple has
different level of income, age and occupation as they are young and have different sort of
opportunities in future to pay off the loan, they have energy to build themselves whereas the
retired people has different age and income to invest for financial planning it can help them
avoid running out of money in retirement. Financial planning can also help them to calculate
the rate of return they need on the investments, how much risk they should take, and how
much income they can safely withdraw from the portfolio.
2.  A mobile phone company that targets people who frequently holiday in remote parts
of the world.
This is an example of geographic segmentation used to market items or services to
individuals who live or shop in a certain place. It works on the assumption that individuals
in that area have comparable requirements, desires, and cultural factors. Mobile company
may focus more relevant marketing messages and acceptable items to customers who are
then aware and more inclined to buy if they understand what people in that region require.
Moreover 92% of travelers access the internet, with 87%turning their cellphone to go online
for booking of hotels, online payments etc.
3. A gourmet cheese company that targets people buying cheese platters for a dinner
party or function.
This is an example of behavioral and psychographic segmentation as the company’s target is
consumers for a specific behavior and occasions. In this case, consumer’s behavior is likely
party planners and host. The company also uses psychographic segmentation as it depicts
user status and consumers’ loyalty to the specific gourmet cheese platter for their parties and
functions.
4. Computer software firm that is most interested in households with a high level of
software purchases.

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 This is an example of behavioral and psychographic segmentation. The company's aim is to
serve consumers who wish to acquire a variety of innovative items as well as those who are
interested in technological advancement.
5. Prestige car manufacturers who highlight the status associated with owning one of
their vehicles.
Ans. This is an example of psychographic and behavioral segmentation since the
corporation aims to appeal to those, who have personalities that consider or value status and
are completely loyal to such brands while shopping for a vehicle, which reflects on the type
of personalities and needs such individuals have.
6. Smart phone manufacturers targeting those consumers who are interested in
purchasing their first smart phone in the future.
This is behavioral segmentation since phone makers are aiming for certain consumers based
on their user status (potential first time buyers/users) and intentions (interested in
purchasing) when it comes to acquiring a smartphone.
7. A plumber deciding to do letterbox drops his local area.
Both geographic and behavioral segmentation are used by the plumber. He is utilizing
geography because he has decided to distribute letters to people who reside in the same
neighborhood as him. He also uses behavioral segmentation since he uses direct marketing
(door to door), which is a specific variable(segmentation) related to behavioral
segmentation.
8. A book publisher that specializes in children’s books.
The book publisher employs demographic and behavioral segmentation because it caters its
product to a certain set of people at a specific period in their lives (children) and their
parents who are inclined to have books for their child. This is a specific variable related to
demographic segmentation. he also uses behavioral segmentation as he wants to retain and
reinforce his regular users and attract nonusers at the same time.   
9. A home-delivered spring water company advertising in a ‘health’ magazine.
This company employs both behavioral and psychographic segmentation. They use
behavioral marketing in their direct marketing since they provide water directly to the
houses that order it. They utilize the latter because they promote their water as healthy,
which appeals to people who are looking for healthy choices.

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10. A travel package tour operator targeting retired people who want educational travel
experiences.
This tour operator, I believe, uses behavioral, demographic, and psychographic
segmentation in their marketing efforts. I believe they are trying to appeal to individuals
searching for a situation-specific product, which is why he is offering educational vacation
experiences rather than just a generic trip, which is a clear relationship to behavioral
segmentation. He employs demographic segmentation since he is targeting people based on
their career or stage of life. Finally, he employs psychographic segmentation to discover
people with adventurous/experience-driven personalities and values.
Question:2 Are there any examples above where the approach used could be classified as
more than one of the segmentation base options? If yes which one and why?
In scenario 3,4,5,7,8,9,10 the firms used hybrid segmentation as all the scenarios have
attributes of more than one segmentation such as in scenario 3 the firm used behavioral and
psychographic segmentation as consumer’s behavior is likely a party planner/ host and it
depicts consumer’s loyalty towards the product which is an attribute of psychographic
segmentation.
In scenario 4 both behavioral and psychographic segmentation have used on the basis of
variety of innovative items and technological advancement.
In scenario 5, behavioral and psychographic segmentation have been used for personalities
that considers status and are completely loyal to such brands.
In scenario 7 both geographical and behavioral segmentation have been used by plumber, he
decides to distribute letter who resides in the same area as him and he used door to door
marketing which is an attribute of behavioral segmentation.
In scenario 8, demographic and behavioral segmentation have been used by firm as their
target audience is children and their parents who are inclined to buy books. Whereas, they
identify different behavior patterns of the consumer to reinforce and retain their regular users
and non-users by word of mouth in a long run.
In scenario 9, behavioral and psychographic segmentation have been used for the consumers
who order healthy water at their door step. The term “Healthy” which appeals to people who
are looking for healthy choices.

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 And in last scenario 10, the firm used three segmentations that is demographic,
psychographic and behavioral for the consumers which have specific age and income, which
prefers educational trip over any generic trip and are very adventurous/experience driven
personalities and values.
Question:3 A number of the firms use hybrid segmentation, what would be the advantages
of this approach?

Hybrid segmentation is a method that combines different types of customer segmentation

models to create a unique segmentation approach. It provides a unified consumer segment
structure that may be used across numerous business functions to maximize business impact.
Managers may eliminate many of the limitations of hybrid segmentation by mixing different
models to best meet your company's sales and marketing goals. Companies have introduced
new channels to old ones as managers have looked to cut costs and enhance market
coverage; they employ direct sales as well as distributors, retail sales as well as direct mail,
direct mail as well as direct sales. Companies develop hybrid marketing systems when they
add channels and communication methods. For this following are the strengths of hybrid
segmentation.
 It allows for a single company-wide strategic focus.
 Provides a unified segmentation that may be used by many business operations.
 Product propositions can be efficiently targeted to current customers.
 E-CRM activity may provide content that encourages engagement.
 The financial potential of section activities may now be calculated more precisely.
As segments are labelled on a basis, the impact of marketing against segments may be
monitored.
In addition to targeting prospects correctly, Hybrid segmentation allows you to target distinct
customers with the appropriate messaging since Hybrid segments are linked to your database
using the data you already have. For instance, we want to make an advertisement for a
certain group, but you're concerned about seeming stereotyped. Rather of being caught
utilizing stereotypes with negative implications, you may go to psychographic segmentation
for context on why a given set of individuals act a certain way.
Question:4 Do you think there is one best segmentation base that most firms should utilize?
Why and why not.
In my opinion three hybrid segmentations are most popular in this regard:

 Behavioral
 Psychographic
 Demographic

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 When behavioral, psychographic, and demographic segmentation are utilized together, they
provide managers with critical background for personalizing every interaction. The more
customized a sales and marketing plan, the more likely the lead will become a customer, and
a customer will come back again and again.
A marketer can utilize demographic data to build a rough draught of their target audience,
then improve the concept with psychographic data to deliver a refined target customer.
Demographic data may be used to attract an initial audience in some marketing initiatives,
while psychographic data can persuade them to believe in the brand and make a purchase.
The next layer was behavioral marketing, which captured information about significant data
points like keyword usage in real-time. The internet research procedure before to buying was
no longer a separate funnel with keyword tracking and analysis. Behavioral marketing
provided advertisers with a perspective of consumers conducting research in real time,
indicating where that research may go and what that consumer would select.
Some of the firms do not use hybrid segmentation, using two or more segmentations for
marketing perspective is because it increases the product/ service cost, larger inventory has
been maintained by both manufacturers and distributors, promotion and distribution
expenditures increase when separate programme are used for different market segments and
lastly when characteristics of a market segment change, investment made already might
become useless that’s why marketers first research on the type of product/service they are
offering and do analysis of their consumers either they have intention or willing to acquire
their product/service.

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