Market segmentation
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Market Segmentation. AS Business Studies Marketing. Look at the other students in the class what characteristics do you all share?. What kind of products are you interested in?. Market Segmentation.

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Market Segmentation

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Market Segmentation

AS Business Studies Marketing


Look at the other students in the class what characteristics do you all share?


What kind of products are you interested in?


Market Segmentation

Market segmentation involves the division of larger markets into smaller groups of consumers who share similar characteristics


What other ways can a market be segmented?


Demographic Segmentation

This is about people in general and will include details about:

  • Age

  • Gender

  • Family size

  • Income levels

  • Ethnic background

  • Occupation

  • Education

  • Religion

  • Socio-economic background


Socio-economicclassficiations

  • Uppermiddleclass

  • Middleclass

  • Lowermiddleclass

  • Skilled manual workers

  • Workingclass (mostlyunskilled manual workers)

  • Casual (part-time workers)

  • Anindividual´s social classcouldhave a greatimpactontheirspendingpatterns


Acronymsforclassifications

  • DINKY (UK) – Doubleincome, no kids

  • YUPPIE (USA)….youngurbanprofessional)

  • NILK (UK) – no income, lots of kids

  • WOOF (UK) – well-off older folk


Psychographicfactors – also determine spendinghabits

  • Lifestyle

  • Attitudes

  • Personalitycharacteristics

  • Etc….


Geographic Segmentation

This will include details about where people live including :

  • Region

  • Post code groups

  • Whether they live in a rural or urban area?


Benefit Segmentation

Based on people who want the benefits the product offers

  • Why do users use a particular product or brand as opposed to any other?

  • What are the common characteristics of people who use particular brands or products?


Behaviouristic Segmentation

This looks at the typical behaviours of groups of customers and includes details about:

  • frequency of purchase

  • loyalty to particular products or brands


List 5 products that could be aimed at each of these different customers.


Market Segmentation in the tobacco industry


Consumers of Cigarettes

  • Slobs (27%)

    • downmarket, likely to live with parents, no further education, unconcerned with diet, health, appearance or company promotions but wanted a 'strong' cigarette

  • Aspiring Sophisticates (20%)

    • Mainly 18-24 year old men. Few go on to higher education but would view their job as a career, image conscious, enjoyed the pursuit of pleasure and viewed Marlboro as a 'trendy' cigarette that reflected their image.


Consumers of Cigarettes

  • Conservatives (28%)

    • Higher income; educated, image and fashion conscious . This group were looking for a mild tasting cigarette.

  • Worriers (25%)

    • Worriers were predominantly women who were health conscious and concerned about their financial state, the environment and the future but not concerned unduly with their image


Reasons for Market Segmentation

  • Sell more products

  • Gain greater knowledge about its customers

  • Target particular groups

  • Help to prevent ineffective promotion

  • Help to market a wider range of differentiated products


Practice – Page 260

  • Read and discusssnumber 7


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