3. • Market segmentation is the process of dividing the
total market into relatively distinct homogeneous sub-
groups of consumers with similar needs or
characteristics that lead them to respond in similar ways
to a particular marketing programme.
• A market segment is a portion of a larger market in
which the individuals, groups, or organisations share
one or more characteristics that cause them to have
relatively similar product needs.
4. LEVELS OF MARKET SEGMENTATION
SEGMENT MARKETING
NICHES MARKETING
LOCAL MARKETING
INDIVIDUALS MARKETING
5. SEGMENT MARKETING
• Consists of a group of customers who share a similar
set of needs and wants.
• Identifiable Group with in a
Market with Similar
• Wants
• Purchasing Power
• Geographical Location
• Buying Attitudes
6. FLEXIBLE MARKET OFFERING
• Even in segments 100 % needs are not same –
consists of two parts
1.Naked Solution :- products and services that all
members of the segment values.
2.Discretionary options :- that some segment members
value. Each option might carry an additional charge.
Example: Automobile industry – basic model is
same but for A.C , power steering, power window
buyer
7. NICHE MARKETING
Group of customers seeking a distinctive mix of benefits who
are ready to pay extra premium.
Eg. Washing detergents Surf excel for tough stains ( hard on
clothes) & Ezee from Godrej for delicate clothes.
--- Astha , Sanskar , Q TV – focus on religion & spiritualism.
DISTINCT NEEDS
PAY PREMIUM
SPECIALIZATION
LESS COMPETITION
POTENTIAL
8. LOCAL MARKETING
• Marketing programs tailored to the needs &
wants of local customer groups in trading
areas, neighborhoods , etc.
• this trend is called grass roots marketing.
• Ex. – Spiderman 3 was released in 5 different
language in India including Bhojpuri.
9. INDIVISUAL MARKETING
• Ultimate segmentation – segments of 1 or
customized marketing or one to one marketing.
• Customerization – empower the consumers to
design the product or service offering of their
choice.
10. Requirements for Effective
Segmentation
Five conditions must exist for segmentation to be meaningful:
1. A marketer must determine whether the market is heterogeneous. If
the consumers’ product needs are homogeneous, then it is
senseless to segment the market.
2. There must be some logical basis to identify and divide the
population into relatively distinct homogeneous groups, having
common needs or characteristics and which will respond to a
marketing programme. Differences in one market segment should
be small compared to differences across various segments.
3. The total market should be divided in such a manner that comparison
of estimated sales potential, costs, and profits of each segment can
be done.
4. One or more segments must have enough profit potential that would
justify developing and maintaining a marketing programme.
5. It must be possible to reach the target segment effectively. For
instance, in some rural areas in India, there are no media that can
be used to reach the targeted groups. It is also possible that paucity
of funds prohibits the development required for a promotional
campaign.
11. How Segmentation Helps
• Segmentation studies are used to uncover
needs and wants of specific groups of
consumers for whom the marketer
develops especially suitable products and
services to satisfy their needs.
12. Bases for Segmentation
• A segmentation variable is a characteristic of individuals, groups or
organisations that marketers use to divide and create segments of
the total market.
• Segmentation descriptors fall under four major categories and
include geographic variables, demographic variables,
psychographic variables, and behaviouristic variables.
Geographic variables focus on where the customers are located.
Demographic variables identify who the target customers are.
Psychographic variables refer to lifestyle and values.
Behaviouristic variables identify benefits customers seek, and
product usage rates.
14. GEOGRAPHIC SEGMENTATION
Divide the market into different group based on :
• Region – South India , North , Western Region, East
• City – metro cities, cities with population more than 1
million
• World
• Density
• Climate
• States
Ex.- Mcdonalds globally, sell burgers aimed at local
markets, for example, burgers are made from lamb in
India rather then beef because of religious issues. In
Mexico more chilli sauce is added and so on.
16. DEMOGRAPHIC SEGMENTATION
• As people age their needs and wants change, some organisations
develop specific products aimed at particular age groups for
example nappies for babies, toys for children, clothes for
teenagers and so on.
• Gender segmentation is commonly used within the cosmetics,
clothing and magazine industry.
• In the UK we have also seen the introduction of Maxim,
(www.maxim-magazine.co.uk) a male lifestyle magazine covering
male fashion, films, cars, sports and technology.
19. Behavioral Segmentation
Occasion Loyalty Status
Special promotions &
labels for holidays. Nonusers, ex-users,
Special products for potential users,
special occasions. first-time users,
regular users.
Benefits Sought
Different segments
desire different
benefits from the same
products. Usage Rate
Light, medium,
heavy.
20. Targeting is a decision
• Market Targeting is a process of
allocation of company effort and
resources towards a certain
market segment.
• Targeting is a match between the
company’s products and services
and the inherent NEEDS AND
WANTS characteristics of the
target segment
• WRONG TARGET…. LOW PROBABILITY OF
SUCCESS….
21. Types of target market
• Multiple segments
– Especially if the needs are homogenous
• Single segment
• Primary target market (PTM)
– Main focal point of all marketing programs
• Secondary target market (STM)
– Used only as a consideration for marketing programs
26. What is Positioning?
• Creating a distinct and relevant differentiation
between the brand and it’s competitors
• Key words
– Distinct – being different
– Relevant – difference being important
27. Why is Positioning important?
• Create a distinction between our brand and its
competitors
• Reason for buying
• Serves as a guide for marketing mix execution
28. Positioning of Procter & Gamble Detergents
Market
Brand Positioning
Share
Tide Tough, powerful cleaning 31.1%
Cheer Tough cleaning, color protection 8.2%
Bold Detergent plus fabric softener 2.9%
Gain Sunshine scent and odor-removing formula 2.6%
Era Stain treatment and stain removal 2.2%
Dash Value brand 1.8%
Oxydol Bleach-boosted formula, whitening 1.4%
Solo Detergent and fabric softener in liquid form 1.2%
Dreft Outstanding cleaning for baby clothes, safe 1.0%
LO9
Ivory Snow Fabric & skin safety on baby clothes 0.7%
Ariel Tough cleaner, aimed at Hispanic market 0.1%
