3. INTRODUCTION
• Market segmentation is the process of diving a
market into subsets of consumers with common
needs or characteristics.
• Targeting consists of selecting the segments that
the company views as prospective customers and
pursing them.
• Market segmentation, strategic targeting, and
product(service) positioning are the key elements
of marketing consumer goods and services.
4. • They enable producers to avoid head on-
competition in the market place by differentiating
their products on the basis of such features as
price , packaging and level of service.
• Marketers use segmentation research to identify
the most appropriate media in which to place
advertisements.
• To be an effective target, a market must be
identifiable, sizeable, stable and growing,
reachable with the marketers objective and
resources.
5. IDENTIFIABLE:
• Marketers divide consumers into separate
segments on the basis of common or shared
needs by using demographics, lifestyles, and
other factors. Some segmentation factors, such
as demographics(e.g., age, gender) are easy to
identify, and others can be determined through
questioning.(e.g., education, income etc.)
6. SIZEABLE:
• The size and profit potential of a market
segment have large enough to economically
justify separate marketing activities for this
segment. If a segment is small in size then the
cost of marketing activities cannot be justified.
• Ex: Athletic and slim men with wide shoulders
and narrow waists often have to buy suits with
trousers that are larger than they need. Most
American clothiers make suits only for men who
have more generous waists than the relatively
small segment of very athletic men.
7. STABLE AND GROWING:
• The segments must be stable so that its
behavior in future can be predicted with a
sufficient degree of confidence.
• EX: teenagers are a sizeable and easily
identifiable market segment, eager to buy, able
to spend, and easily reached. They are also
likely to embrace fads, and by the time
marketers produce merchandise for a popular
teenage trend, interest in it may have waned.
8. REACHABLE:
• A segment must be accessible, which means
that marketers must be able to communicate
with its consumers effectively and
economically. Marketers have significantly
more avenues for reaching unique segments
and can also do so with customized products
and promotional messages.
9. Valid:
• This means the extent to which the base is
directly associated with differences in needs and
wants between the different segments. Given
that the segmentation is essentially concerned
with identifying groups with different needs and
wants, it is vital that the segmentation base is
meaningful and that different preferences or
needs show clear variations in market behavior
and response to individually designed marketing
mixes.
10. CONGRUOUS:
• The needs and chacteristics of each segment
must be similar otherwise the main objective
of segmentation will not be served. If within a
segment the behavior of consumers are
different and that they react differently, then
a unique marketing strategy cannot be
implemented for everyone. This will call for a
further segmentation.
11. ACTIONABLE:
• It has to be possible to approach each segment
with a particular marketing program me and to
draw advantages from that. The segments that
a company wishes to purse must be actionable
in the sense that there should be sufficient
finance, personnel and capability to take them
all. Hence, depending upon the reach of the
company, the segments must be selected.
12. SOME GENERAL CONSIDERATIONS:
• Apart from the above-mentioned chacteristics,
the segment must have some other features:
1. Growth Potential.
2. Profitable.
3. Less risk prone.
4. Less competition intensive.
