UNIT VII

MARKET SEGMENTATION
TARGET MARKET
 What is Market Segmentation?
• Market Segmentation is a process of dividing
the market of potential customers into
different groups and segments on the basis of
certain characteristics.
• Grouping the customers based on certain
criteria.
• Helps to identify the target market.
TYPES OF MARKET SEGMENTATION
 1. Demographic segmentation:

• Demographic segmentation is the basic way of market segmentation

• Grouping is based on characteristics such as :
– Age
– Gender
– Income
– education
– Religion
– Marital status
• For example. demographic segmentation might target potential
customers based on their income, so your marketing budget isn’t wasted
directing your messaging at people who likely can’t afford your product.
• Video games are often targeted at youngsters
• Diet coke ------age group 30-50 years
 2. Geographic Segmentation
• is technically a subdivision of demographic segmentation.
• This approach groups customers by physical location, assuming that people within a
given geographical area may have similar needs.
• Segmentation is on the basis of
– Country
– Region
– City
– Postal code

• This strategy is more useful for larger companies seeking to expand their
products/business into different branches, offices, or locations.

Examples :
1. Raincoats and umbrellas are mostly for rainy regions
2. Woolen /warmer clothes for cold regions
3. water might be scarce in some regions. So, the demand for bottled water will
increase but, in those countries where water is in abundance ,the demand for bottled
water will be comparatively less.
 3. Psychographic segmentation
• Often the most difficult market segmentation approach
• Psychographic segmentation is focused on your customers’ personalities and
interests.
• Segmentation is based on criteria such as :
– Personality traits
– Hobbies
– Life goals
– Values
– Beliefs
– Lifestyles

Examples
1. Fitness products meant for individuals living a healthy lifestyle
2. Sports equipments for people who love sports
3. A person having a lavish lifestyle may consider having luxury products an air conditioner in
every room as a need, whereas a person living in the same city but having a conservative
lifestyle may consider it as a luxury.
• In other words, demographic data might tell
you your customer is a young man;
psychographic segmentation lets you know
this customer loves bowling,
 4. Behavioural segmentation
• This approach groups consumers based on how they have
previously interacted with markets and products such as :
– Spending habits
– Purchasing habits
– Interactions with the brand
– Loyalty to brand
– Previous product feedback
• Based on what they are looking for in a product and why
they buy the product.
• How often and how much they consume the pdt
 Benefits of Market Segmentation

• Marketing segmentation takes effort and resources to

implement.
• Several benefits of market segmentation include;
– Increased resource efficiency as we can plan the resource utilisation
– Stronger brand image through better customer experience
– Better targeted advertising. This allows companies to create
marketing campaigns that are essential for their growth and
development.
– Greater potential for brand loyalty as there is more direct/personal
marketing
– Stronger market differentiation. Successful marketing segmentation
campaigns can increase the long-term profitability and health of a
company.
• Market segmentation realizes that not all customers have
the same interests, purchasing power, or consumer needs.
• Instead of catering to all prospective clients broadly,
market segmentation is important because it strives to
make a company's marketing campaigns more strategic
and refined.
• By developing specific plans for specific products with
target audiences in mind, a company can increase its
chances of generating sales and being more efficient with
resources.
 REQUIREMENTS FOR EFFECTIVE SEGMENTATION

An effective market segmentation must be :

• Measurable
• Accessible
• Substantial
• Differentiable
• Actionable
 Measurable 

• The size, purchasing power, and other

relevant characteristics of the segment must
be measurable and obtainable in terms of
data.
 Accessible

• The market segments must be effectively

reached and served. Easily reached at an
affordable cost
 Substantial 

• The market segments are

• A segment should be the largest possible
homogeneous group worth pursuing with a
tailored marketing program.
• The segment should be substantial. It should
be large enough or profitable enough to serve.
 Differentiable
• The segments should be differentiable.
• There must be the clear-cut basis for dividing
customers into meaningful homogeneous
groups. 
 Actionable

• It should be actionable for marketing

purposes.
• Organizations should be able to design and
implement the marketing mix to serve the
chosen segment.
 TARGET MARKETING
• A target market is the end consumer to which
the company wants to sell its end products
too.
• Target marketing involves breaking down the
entire market into various segments and
planning marketing strategies accordingly for
each segment to increase the market share.
• not all products can be consumed by all
customers and each product has a different
set of consumers who want to purchase the
product.
• In order to attract a particular segment of the
market, the company will modify the product
accordingly.
 Steps in creating a target market strategy

• 1. Identify your current consumer base

• 2. Evaluate target markets for viability
• 3. Determine the best marketing strategy
• 4. Create a client profile
• 5. Analyze your data

Refer word document

 Strategies or ways to reach your target market:

1. Use a variety of tools to reach your target market such as

– Content marketing
– Email marketing
– SEO
– Online advertising
– Traditional advertising

2. Focus on social media that fits your brand

– Different social media platforms uniquely benefit specific businesses or product
types.
– Your brand may not need to use all types of social media to reach your
audience.
– Instead, focus on the platforms that fit your brand's communication style and
work best to promote your product or services.
• Content marketing
– newsletters, podcasts, social media posts, and
videos.
– All of these forms of content are meant to provide
useful and relevant information that delights users
and attracts them to your brand
• Email marketing 
– is a direct marketing channel that lets businesses
share new products, sales, and updates with
customers on their contact list or soon to be
customers
– In most of websites ,its compulsory to sign in and
give your email
• SEO stands for search engine optimization. 
– SEO is the process of taking steps to help a
website or piece of content rank higher on
Google.
– Through SEO, marketers attempt to get more
visibility for their website in search engine results
pages.
• Online advertising
– Advertising the product on a social platform
– Examples of online advertising include social
networking ads, email spam, pop-ups, using GIFs
(Graphic Interchange Format)
• Traditional advertising
– uses offline media to reach an audience.
– Example : newspaper ads and other print ads,
billboards, TV and radio advertisements.
End of unit 7