Page 232 - DMGT308_CUSTOMER_RELATIONSHIP_MANAGEMENT

Unit 9: Segmentation, Targeting and Positioning

Notes
Example: Segmenting the market on the basis of intelligence would be difficult because
this characteristic cannot be measured accurately.
Marketers can use one or more variables to segment the market. Different variables are used to
segment consumer markets. They are discussed in following subsections.

Geographic Segmentation

Geographic location of consumers is usually the starting point of all market segmentation
strategy. The location of consumers does help the company in planning its marketing offer.
These geographic units may be nations, states, regions, areas of certain climatic conditions,
urban and rural divide. The assumption is that consumers in a particular geographic area have
identical preferences and consumption behaviour.

Example: People in West Bengal have different food habits and dress code than people
in South India. Exporters often segment the market as Western countries, African countries and
CIS countries etc.

Demographic Segmentation

Demographic characteristics are commonly used to segment the market. Factors such as age,
sex, education, income, marital status, family size and social class etc. are used singly, or in a
combination, to segment a market. Shaving products for women are based on the demographic
variable of gender. Toy manufacturers such as Funskool and Mattel toys segment the market on
the basis of age of children. Auto manufacturers segment the market by considering income as
an important variable. Producers of refrigerators, washing machines, microwave ovens etc.
take income and family size as important variables in segmenting the market. Ready-to-wear
garment producers often segment the market on the basis of social class.

Example: Chirag Din, Arrow, Van Heusen, Louis Philippe, Levi and others.
In general, the social class can represent lower, middle and upper class depending on education,
income and status etc.

Example: An engineer and a clerk are considered as members of different social classes.

Psychographic Segmentation

When the segmentation is based on personality or lifestyle characteristics, it is called
psychographic segmentation. Consumers have a certain self-image and this describes their
personality. There are people who are ambitious, confident, aggressive, impulsive, modern,
conservative, gregarious, loners, extrovert, or introvert etc.
Lifestyle

It is an indicator of how people live and spend their time and money. What people do in their
spare time is often a good indicator of their lifestyle.
Consumers in different countries and cultures may have characteristic lifestyles. For example,
Indian women are more home-focused, less likely to visit restaurants, more price-sensitive,
spend time preparing meals at home and are fond of movies.

LOVELY PROFESSIONAL UNIVERSITY 227