Sonali R Saldanha, Asst.

Prof , NIFT- Mumbai

Market segment
The process of dividing a market into distinct subsets of consumer with common needs or characteristics and selecting one or more segments to target with a distinct marketing mix.

Sonali R Saldanha, Asst. Prof , NIFT- Mumbai

3 Phases of Marketing Segmentation

Phase 1 Market Segmentation

Phase 2 Target Market & Marketing Mix Selection

Phase 3 Product / Brand Positioning

Sonali R Saldanha, Asst. Prof , NIFT- Mumbai

Need of segmentation
Need, want and desire are not same.
The primary advantage is cost reduction. It avoids head on competition in the market place.

Sonali R Saldanha, Asst. Prof , NIFT- Mumbai

How segmentation operates

Segmentation studies are designed to discover the

needs and wants of specific groups of consumer, so that specialized goods and services can be developed and promoted to satisfy each groups needs.

It is also used to guide the redesign, the reposition,

or extending the product targeting to a new consumer segment.

Sonali R Saldanha, Asst. Prof , NIFT- Mumbai

Segmentation strategies
The first step in developing a segmentation strategy is to select the most appropriate base on which to segment the market. Eight major categories of consumer characteristics provide the most popular bases for market segmentation.

Sonali R Saldanha, Asst. Prof , NIFT- Mumbai

 Geographic factor Demographic factors Psychological characteristics Sociological variables Use related characteristics Use-situation factors Benefit sought Hybrid segmentation.

Sonali R Saldanha, Asst. Prof , NIFT- Mumbai

Geographic segmentation
In geographic segmentation, the market is divided by location. The theory behind this strategy is that people who live in the same area share some similar needs and wants and that these needs and wants differ from those of people living in other areas. Eg : Tutorials in Kharghar rather than Kalamboli. Eg : Woollens in North India rather than in South India.

Sonali R Saldanha, Asst. Prof , NIFT- Mumbai

Demographic segmentation
Demographic characteristics, such as age, sex, marital status, income, occupation and education are most often used as the basis for market segmentation. Demographics refers to the vital and measurable statistics of a population. Demographics help to locate a target market.

Sonali R Saldanha, Asst. Prof , NIFT- Mumbai

Psychographic segmentation
Psychographic characteristics refers to the inner qualities of the individual consumer. Consumer segmentation strategies are often based on specific psychological variables. 1. need and motivation 2. personality 3. perception 4. attitude, etc.

Sonali R Saldanha, Asst. Prof , NIFT- Mumbai

PSYCHOGRAPHICS SEGMENTATION
Psychographic segmentation is done on the basis of psychological characteristics of an individual consumer such as ones attitude, beliefs, values, lifestyle, perceptions, mindset, learning and motivations.

Sonali Saldanha, Asst Professor, FMS Mumbai

Socio-cultural segmentation
Socio-cultural variables such as group and culture, provide further bases for market segmentation. For example, consumer markets have been successfully subdivided into segments on the basis of stages in the family life-cycle, social class, core culture values, etc Eg : No Non Veg in Jain Societies. Cake shop near a Church

Sonali R Saldanha, Asst. Prof , NIFT- Mumbai

Use related segmentation

An extremely popular and effective form of segmentation categorizes consumers in terms of product, service, or brand usage characteristic, such as usage rate ( volumes), awareness status, and degree of brand loyalty. Eg : How many I use ? Which one I use ? Eg : How many times I had noodles. ?? Maggi ?? Eg : Mobile Refill How Often to charge ? Which one?

Sonali R Saldanha, Asst. Prof , NIFT- Mumbai

Usage-situation segmentation

Occasion or situation often determines what consumers will purchase or consume. Marketers recognize that the occasion or situation often determines what consumers will purchase or consume. For this reason, they sometimes focus on the usage situation as a segmentation variable. Eg : Cards on Valentine Day Party on Promotion Medicines on a outburst of a disease.
Sonali R Saldanha, Asst. Prof , NIFT- Mumbai

Benefit segmentation
Marketing and advertising executives constantly attempt to isolate the one particular benefit that they should communicate to consumers. Changing lifestyle plays a major role in determining the product benefits that are important to consumers and provide marketers with opportunities for new product and services. Eg : Toothpaste that eliminates cavities, reduce plaque, herbal and strengthen gums. Eg : Benefits desired when purchasing shampoo include, dandruff prevention, making hair smell nice, making hair soft and manageable, inexpensive, preventing baldness, being mild and gentle, restoring luster, etc

Sonali R Saldanha, Asst. Prof , NIFT- Mumbai

Hybrid segmentation
Marketers commonly segment markets by combining several segmentation variables rather than relying on a single segmentation base. 1. psychographic-demographic 2. geo-demographic 3. VALS 2 ( Value And Lifestyle Segments )

Sonali R Saldanha, Asst. Prof , NIFT- Mumbai

LIFESTYLE
The most popular method of understanding the consumer or consumer behavior. It is defined as patterns in which people live and spend time and money reflecting a persons Activities, Interests and Opinions ( AIOs) as well as demographic variables discussed earlier. Lifestyles change more rapidly. Extremely important to monitor changes in lifestyle trends. Ex: Products are well-defined and targeted as per the lifestyle of any particular client. 1)Massage chairs 2)Dhara ad with Soha n Sharmila 3) Advancement in Beauty Treatments 4) Online Banking / Internet Reservations etc.
Sonali Saldanha, Asst Professor, FMS Mumbai

VALS (Values and Lifestyle systems)

A widely used approach to study lifestyle. Lifestyle can be categorized under eight heads.

1. Actualizers: 2. Fulfilleds:

Successful, active, sophisticated consumers with many resources and high self esteem. Image conscious. satisfied, mature, comfortable. Pays importance to functionality, value and durability.

3. Believers: principle oriented, conservative, follow general beliefs.

Less experimental in terms of products. Prefer proven and popular brands.

Sonali Saldanha, Asst Professor, FMS Mumbai

4.

Achievers: Career-oriented people, prefer predictability as opposed to

risk and self discovery. Prefer prestigious brands being symbolic of their success to the world.

5.

Strivers: seek self definition, security. Concerned about the approval

of others. Strive to be like someone but are short of resources to attain their goal.

6.

Experiencers: Young, enthusiastic and Highly experimental. Prefer

variety and excitement. work. Do not go out of the frame. Prefer strictly functional and requirement focus products only.

.Makers: Focus on self-sufficiency, live within the context of family and Strugglers:Poor and poorly educated. concerned with issues of the

8.

moment. Extremely cautious. Seeks security and safety in the products.

Sonali Saldanha, Asst Professor, FMS Mumbai

VALS II

VALS 2 is a marketing and consulting tool that helps businesses worldwide develop and execute more effective strategies. The system identifies current and future opportunities by segmenting the consumer marketplace on the basis of the personality traits that drive consumer behavior. VALS applies in all phases of the marketing process, from new-product development and entrystage targeting to communications strategy and advertising.
Sonali R Saldanha, Asst. Prof , NIFT- Mumbai

Sonali R Saldanha, Asst. Prof , NIFT- Mumbai

Implementing segmentation
Concentrated marketing For a well-defined,

specific segment of the consumer population

Differentiated marketing - also called

multisegment marketing

Counter-segmentation - A strategy in which a

company combines two or more segments into a single segment to be targeted with an individually tailored product or promotion campaign.
Sonali R Saldanha, Asst. Prof , NIFT- Mumbai

THANK YOU
Sonali R Saldanha, Asst. Prof , NIFT- Mumbai