Market Segmentation: Art or Science?

Zeenat Jabbar

THE IBC STRATEGY: PART III

Market Segmentation: Art or Science?

NIKEZeenat Jabbar

Market Segmentation: Art or Science?

Definition

• Market Segmentation:

– Dividing a market into distinct groups with distinct needs, characteristics, or behavior who might require separate products or marketing mixes.

Zeenat Jabbar

Market Segmentation: Art or Science?

Know Your Market

What information do you need to reach your prospects successfully?

Do you understand their problems? Have you thought about what you want

people to think and feel about your brand?

Zeenat Jabbar

Market Segmentation: Art or Science?

Zeenat Jabbar

Market Segmentation: Art or Science?

Developing a Market Segmentation Strategy

Define Product Market

Determine Bases for Segmentation

Describe Segments

Evaluate Potential Success

Select Target Markets

Determine Marketing Mix Strategies

1

2

3

4

5

6

Zeenat Jabbar

Market Segmentation: Art or Science?

Zeenat Jabbar

Market Segmentation: Art or Science?

Zeenat Jabbar

Market Segmentation: Art or Science?

Target Information

Household income Spending Marrieds Birthrate Aging Women

Men Single-Person

Households

Zeenat Jabbar

Market Segmentation: Art or Science?

Zeenat Jabbar

Market Segmentation: Art or Science?

• Segmenting Consumer Markets

• Geographical segmentation– Marketing mixes are

customized geographically• Demographic segmentation

– Most popular segmentation– Demographics are closely

related to needs, wants and usage rates

• Psychographic segmentation– Lifestyle, social class, and

personality-based segmentation

• Behavioral segmentation– Typically done first

Zeenat Jabbar

Market Segmentation: Art or Science?

Zeenat Jabbar

Market Segmentation: Art or Science?

• Requirements for Effective Segmentation

• Measurable– Size, purchasing power,

and profile of segment• Accessible

– Can be reached and served

• Substantial– Large and profitable

enough to serve• Differentiable

– Respond differently• Actionable

– Effective programs can be developed

Zeenat Jabbar

Market Segmentation: Art or Science?

Zeenat Jabbar

Market Segmentation: Art or Science? Bases for

Segmentation

Needs

ProfilersZeenat Jabbar

Market Segmentation: Art or Science?

Advertising & Promotion for BBA2K7 Zeenat Jabbar

Market Segmentation: Art or Science?

Zeenat Jabbar

Market Segmentation: Art or Science?

Elements of Lifestyle

ACTIVITIES INTERESTS OPINIONS DEMOGRAPHICSWork Family Themselves Age

Hobbies Home Social Issues EducationSocial Events Job Politics Income

Vacation Community Business OccupationEntertainment Recreation Economics Family Size

Club Membership Fashion Education DwellingCommunity Food Products GeographyShopping Media Future City Size

Sports Achievements Culture Stage in Life Cycle

Zeenat Jabbar

Market Segmentation: Art or Science?

Kellogg’s Special K

SEGMENT DEMOGRAPHICS BEHAVIOURISTICS PSYCHOGRAPHICS COMPANY'S BRANDS COMPETITORS'NEEDS/ BENEFITS BRANDS

Flavour Age: 20-30 yrs-old Medium-to-Heavy Users Fun seekers, adventurous, Original Special K, Kellogg's other brands,energetic, peer pressure Red Berry Special K Weetabix, Nestle, Alpen, etc.

group memberNutrition Value, Age: 31-44 yrs-old, Heavy Users Self-Confident, alert Original Special K, Kellogg's other brands,

Quality 45-54 yrs old Medium-to-Heavy Users to change, ambitious Special K Plus Fruitbix, Organic Crunch,Convenience Working men and Heavy Users Authoritarian, ambitious, Original Special K, Multi Flakes, Shredded Wheat.

w omen independent, health Special K Plus Kellogg's other brands,conscious Fruitbix, Organic Crunch,

Multi Flakes, Shredded Wheat.

Zeenat Jabbar

Market Segmentation: Art or Science?BENEFIT ACTIVITIES INTERESTS OPINIONS DEMOGRAPHICS

Functionality Student; Sports, Peer Pressure, Age: 20-30 yrs-old.You Can Use Adventurous, Entertainment, Education, FLC: Single;

Energetic Fashion Culture Light-to-Medium UsersValue and Self-made Home, Ambitious, Age: 26-50 yrs old.

Convenience Businessman; Community, Adventurous, FLC: Single, NewlyBetter-Off, Personal Planned Married, Full Nest I, II &

Independent Acievements, Purchasing, III,Recreation, Strong Views Medium-to-Heavy UsersBusiness about Products,

Politics, FutureBusiness andSocial Issues

Powerful and Successful Home, Job, Ambitious, Age: 27-43 yrs-old.Light Professional; Fashion, Energetic, FLC: Single, Newly

Better-Off, Community, Planned Married, Full Nest I, II &Independent Recreation, Purchasing, III,

Personal Strong Views Heavy UsersAcievements, about Products,Entertainment Politics, Future

Business andSocial Issues

Flexibility to Frequent Job, Fashion, Authoritarian, Age: 29-55 yrs-old.Perform Travellers; Home, Strong Views FLC: Single, Newly

Businessmen, Community, about Products, Married, Full Nest I, II &Executives, Recreation, Politics, Future III.Better-Off, Personal Business and

Independent Achievements, Social IssuesFood,

Entertainment

Laptops

Zeenat Jabbar

Market Segmentation: Art or Science?

Zeenat Jabbar

ASIAN PAINTS

Market Segmentation: Art or Science?

Target Generations

Good warriors (1909-1928)

Matures (1929-1945)

Baby boomers (1946-1964)

Gen Xers (1965-1982)

Gen Yers (1983-2001)

Generation Zers (2002+)

Zeenat Jabbar

Market Segmentation: Art or Science?

Planning the Advertising

Market segmentation is the division of an entire market of consumers into groups whose similarity makes them a market for products serving their special needs.

A situation analysis is the part of the advertising plan that answers the questions: Where are we today and how did we get here?

Zeenat Jabbar

Market Segmentation: Art or Science?

Steps in the Market Segmentation Process

Segment your market

Target a segment

Position your product

Communicate your positioning

Zeenat Jabbar