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MARKET SEGMENTATION

Alduheza, Shynne B.
Bugais, Lislyn Megann D.
Cesar, Jan Harmony A.
Flores, Chiena Mae S.
Espana, Lorebeth L.
Lo, Manuel Timothy Jude C.
Manzo, Marie Angeli F.
Tan, Marie Charmaine B.

Marketers

• identify individuals in the market who can be
served most effectively and profitably
• use segmentation to identify similarities within
groups of consumers and benefit from these
similarities

Marketers





Identify opportunities in the market.
Tailor a unique marketing mix.
Charge and receive higher prices.
Serve customers more efficiently.
Gain a competitive advantage.

Definition of Terms • Market Segmentation .dividing a market on the basis of differences and forming subgroups based on common characteristics .goes hand in hand with targeting and positioning • Segmentation .identifies variables that can be used to target desirable groups of individuals .

Identifying Desirable Market Segments • • • • identifiable accessible of sufficient size responsive to the targeted marketing mix .

Selecting Segmentation Variables • through experience and intuition • adopting the ideas of others • analyzing customer data .

Segmentation Approaches Empirical based on professional experience or information colleccted from literature resembles empirical treatment by physicians and pharmacists Hypothesis-Driven tests hypotheses about the relationships between market segmentation variables and outcomes gain insights about actual and potential customers that can be used to secure a competitive advantage builds on information used in empirical segmentation rely on market research techniques to identify patterns of consumer behavior .

Empirical Segmentation Advantages Disadvantages relies on marketer's experience and ability to understand which variables are useful complex expensive as the amount of time devoted to it and the cost of the subcriptions to the publication bombarded with tremendous amounts of information about customer behavior and actions of competitors time-tested business owners rely on their intuition and knowledge to serve customers .

Hypothesis-Driven Segmentation Advantages Disadvantages uses methods from a variety of fields the more rigorous the to gain greater understanding of methods used. the consumer behaviors and markets higher the costs .

Marketing Strategies Associated with Segmentation • Differentiation Strategies .attempt to select a portfolio of products and services to meet the needs of multiple customer groups • Focus Strategies Niche: small. profitable segment that offers the best opportunity for success .selects two or more segments for targeting . Niche / Microniche Strategies . narrowly defined market a.select a single.

Characteristics of a Niche • large enough to be profitable • underserved or ignored by competitors • able to be exploited by the unique skills and capabilities of marketers .

Common Ways of Segmenting Markets • • • • • Demographic Geographic Psychographic Behavioral Benefits .

Demographic Segmentation • • • • most easily segmented most common bases of segmentation useful in developing targeting strategies variables: age. income. sex. religious affiliation. nationality .family size. ccupation. ethnicity. family life cycle. education.

and social activities .degree of social interaction with others .Senior Market • users of prescription medications and other forms of health care • fastest growing segment • with highest discretionary income • five variables for segmentation: .general activity level . job.general level of health .discretionary income .amount of discretionary time not taken up with family.

Cohort Segmentation • dividing consumers by age into a cohort Cohort: a group of people of the same generation . Generation X. Greatest Generaion. Swing Generation. the same historical events during formative periods -Great Depression: thrifty -Vietnam War: challenge authority -Others: Depression Babies. Millennials . Baby Boomers. Generation Y. Silent Generation.

Geographic Segmentation • permits pharmacists to target patients on the basis of location • used to locate lucrative market segments and target those segments with promotional communications • variables: country. region. neighborhood. city. metropolitan statistical area. county. rural . state.

and attitudes . and communication decisions • uses psychological and socioogical research methods .Psychographic Segmentation • based on the premise that consumers are influenced by personality. and values • useful for shaping promotional strategies. beliefs. product development.identify consumer values. lifestyle.

compulsive b. conservative d. socializer e.Methods of Psychographic Segmentation • Personality Segment -based on behavioral traits or personality characteristics a. controlling c. need to achieve . extrovert f.

used to classify senior populations . and consumers' opinions .Methods of Psychographic Segmentation • Lifestyle Segment Lifestyle: relates to the activities. interests.reflects a group's priorities and beliefs about various issues .

condition-specific website. trust physicians but feel in control of own health have string brands of ideas. peers. first to switch brands internet.Segment Characteristics Barriers to Treatment How to Reach Message Disciples obedient. adherent. often in denial family members. clarify necessity for treatment Fatalists feel health is out of control. highly compliant with therapies sometimes forgetful pharmacists. reinforce benefits of treatment Medical Buffs engaged. feel hopeless and peers. telephone reminders deliver wake-up call. emphasize the natural Immortals devi-may-care types. remedies anxious about side effects guerrilla marketing. advertising. you can overcome symptoms . popular press remind. brand-specific ads position treatment as patientphysician relationship. medical publications. telephone helpless reminders with help. point-of-purchase displays position treatment as part of healthy lifestyle. stress brand superiority Naturalists distrust shun pharmaceuticals traditional in favor of holistic treatments. trusting. often noncompliant family members. disregard physician's recommendations ill-informed. nonbranded ads.

identify values upon which people base their lives and day . accomplishment. being well. having warm relationships.includes: self-respect. sense of beloging.respected . selffulfillment. security. sense of fun and enjoyment of life. excitement.Methods of Psychographic Segmentation • Segmentation by Values .

Psychographic Research and Drug Use • • • • • • • Realists Authority Seekers Skeptics Hypochondriacs Dissatisfied Energetic Sedentary .

Combining Psychographic and Demographic Variables • • • • Ambivalent learners Uncertain patients Risk avoiders Assertively reliants .

frequency of visits to health care providers .level of participation in pharmaceutical care activities .self-care habits .Behavioral Segmentation • uses information about consumer actions and choices to group customers • deals with utilization of health care services and products • criteria include: .nonprescription and heral medication use .type of health insurance or plan choices .prescription drug use .preventive care behaviors .

Pareto Principle • a relatively small number of people use a disproportionate amount of health care services and products • approximately 80% of most problems can be attributed to roughyly 20 of their potential causes • pharmacists should target 20% of the market associated with drug misuse. and other behaviors . health care spending.

at home and on vacation .Types of Behavioral Segmentation • based on actual behavior a. or light users . usage . moderate.for the respondents or for treating family members .heavy.disease management .case management b. occasion .treating major and minor illness .

user status: previous use . and financial capability to absorb failures Early Adopters (Opinion or Thought Leaders) socially connected ad influenced by innovators sought out for advice. former. eager to try new things.c. greater education. willing to take risks have a broader viewpoint. willingness to adopt innovations Individuals Descriptions Innovators first to adopt new ideas and products venturesome. and willing to share new idease through wordof-mouth discussions . or potential users d.first-time. user status and loyalty . repeat. respected by others.

Individuals Descriptions Early Majority influenced by early adopters careful. deliberate. willing to take more time in making decisions well integrated socially Late Majority cautious and skeptical wth regards to innovation tend to wait to adopt innovations Laggards traditional in outlook and look to the past in decisionmaking socially isolated and resist innovations .

aware. repeat usage • based on a mix of actual and potential behavior . evaluation.according to the readiness to buy or act in some desirable manner .variables: at risk for drug-related problems . interest. usage. trial.unaware.• based on potential behavior .

Benefits Segmentation • according to the specific benefits the customers seek • consistent with the total product concept .

Customers Descriptions seek the best product and Quality buyers service without regard to cost look for personal and caring Service buyers service hunt for the best value for the Value buyers money and expect service to match the price Economy buyers favor cheapest alternative .

and prevenetive therapies Health seeker strive for a long. healthy life and use preventive care as means to that end actively participate in health behaviors actively seek information about healthy practices and preventive sevices respond to the marketing of healthy foods Band-Aider like to brag how healthy they are take great pride in how little the have needed to use health care services preventive health care is undesirable seek care only when they are very ill or injured . self-diagnostic kits.Consumers of preventive Descriptions health services need and actively seek reassurance that they are healthy tend to overuse health services Hypochondriac good customers of vitains.

or attend health screenings Self-sufficient independent. use negative health behavior to cope up with the daily stresses of life avoid preventive health care Follower seek the guidance of others for preventive practices seek advice from friends. self-reliant tend to be skeptical of traditional health care and prefer selftreatment with nonprescription medications and home remedies . other health professionals tend to do what others recommend but are skeptical that preventive health care will bring about the promised improvements in health more likely to put off health care until they get sick unlikely to use vitamins. family. preventive remedies.Consumers of preventive Descriptions health services Do not bug me.

. .Conduct surveys. . .Segmentation for the Practising Pharmacist • Goal: help identify and predict consumer tendencies to act in specific ways • Pharmacists need to conduct research into their needs and wants.Read the pharmacy and health car literature. .Invite a group of patients to chat about pharmacy services.Talk with Patients.

Mine patient files. • Pharmacists can use segmentation to target specific customer groups.- Use the internet.Identify key market segments within your practice. . Test-market ideas.Learn as much as you can about the segments in which you are interested. Observe how customers shop.Describe a typical person in a market segment. . . .

.Choose a future date when you will reassess your marketing efforts.Determine the desirability of each segment.Select those segments on which you wish to focus and create a written plan for each segment. . . .Develop measures for the success of targeting efforts. .Establish a budget for each segment. .