Market Segmentation

1
Market Segmentation
2
Todays objectives

• To understand market segmentation and targeting.
• To be able to evaluate the success of market
  segmentation for businesses.

3
Running a successful business involves 3Cs 4Ps

• Product
• Price
• Place
• Promotion

• Customer
• Company
• Competitor

Today we are looking at the 3Cs
4
Customers

• Knowing your customers is a vital tool in running
  a successful business

5
Market Segmentation.
Segment C
Segment B
Segment D
Segment A
6
Market Segmentation

• This is where the market is broken down into
  smaller sub groups that share similar
  characteristics

• Age
• Gender
• Income
• Religion
• Ethnic group
• Level of education
• Geographical
• Social class

Examples
7
Market segmentation

• A Higher managerial, administrative or
  professional
• B Intermediate managerial, administrative and
  professional
• C1 Supervisory, clerical, junior administrative
  or professional
• C2 Skilled manual workers
• D Semi and unskilled manual workers
• E State pensioners, widows, lowest grade workers.

8
Why is it important to understand ALL your
customers?

• The benefits they want (service or extras)
• The amount they are able to or willing to pay
• Media (e.g. television, newspapers, and
  magazines) they see to target your advertising
  at them.
• The quantities they buy and what special offers
  catch their interest.
• The time and place that they buy

9
So which market segment customer would buy these?

• Age
• Gender
• Income
• Religion
• Ethnic group
• Level of education
• Geographical
• Social class

1_2 market segmentation task.ppt
10
Why is it important to know your customers?
Mass market
Range of customers
Niche
Whether your product appeals to the masses, a
small niche or a range of different customers.
Every business needs to MARKET its goods..
11
So which of these products have a
Run-a-round Take your poster of your product
and move to the right area!

• Niche?
• Mass?
• Range of customers?

12
Run-a-round Take your poster of your product
and move to the right area!
13
(No Transcript)
14
So Market Segmentation is a lot more than
advertising!
The owner The Franchisor BoD Marketing
manager Financial manager MD

• So who decides on the marketing budget and what
  direction the marketing plan goes?

15
Marketing Objectives
16
SMART Targets
Can anyone remember what S.M.A.R.T. stands for?
17
SMART Targets
Can anyone remember what S.M.A.R.T. stands for?
No its not an Ashcombe invention! Its a
business tool.
18
Marketing objectives involve
Some examples
But none of these are SMART!
19
Examples of SMART targets
20
Demographic V Geographic Segmentation?
21
Demographic geographic segmentation

• Demographic segmentation
• Dividing the market into groups based on
  variables such as age, gender family size,
  income, occupation, education, religion, race and
  nationality
• Geographic segmentation
• Geographic segmentation tries to divide markets
  into different geographical units

22
Geographic Segmentation

• Regions e.g. in the UK these might be England,
  Scotland, Wales Northern Ireland or (at a more
  detailed level) counties or major metropolitan
  areas
• Countries perhaps categorised by size,
  development or membership of geographic region
• City / town size e.g. population within ranges
  or above a certain level
• Population density e.g. urban, suburban, rural,
  semi-rural

23
Limitations of Segmentation

• Lack of information and data some markets are
  poorly researched with little information about
  what customers want
• Difficulty in measuring and predicting consumer
  behaviour humans dont all behave in the same
  way all of the time.
• Hard to reach customer segments once identified
  it is one thing spotting a segment it is another
  reaching target customers with an effective
  marketing message

24
Now you try it!

• Using the case studies. Or put a few up here on
  the screen
• Identify the market segmentation by categories
• Identify the demographic segmentation which
  one(s) would be better also looking at geographic
  segmentation?

25
Case Study No/Company name
26
(No Transcript)
27
(No Transcript)
28
(No Transcript)
29
Homework

• Watch TV Adverts select one advert and write
  a summary of the demographic segmentation that
  the advert is aimed at.
• Justify why you think the ADVERT specifically
  targets that group(s) of customers!

30
Plenary

• Why do businesses have marketing objectives?
• What does SMART mean?
• Can anyone list the 8 demographic market
  segmentation categories?

• Age
• Gender
• Income
• Religion
• Ethnic group
• Level of education
• Geographical
• Social class