Market Segmentation
Three Phases of Marketing Strategy
l Phase 1: Market Segmentation
l Phase 2: Target Market and Marketing Mix Selection
l Phase 3: Product/Brand Positioning
“Best” Customer Segmentation
Demographic Segmentation
l Age
l Sex
l Marital Status
l Income, Education, and Occupation
Age: Segmentation by Age Effects and Cohort Effects
l Seven Life Development Stages
– Provisional Adulthood
l Pulling up roots
– First Adulthood
l Reaching out, Questions/questions, Mid-life explosion
– Second Adulthood
l Settling Down, Mellowing, Retirement
Marital Status
l Households as a consuming unit
– Singles
– Divorced
– Single parents
– Dual-income married
Sociocultural Segmentation
l Family Life Cycle
l Social Class
l Culture, Subculture, and Cross-Culture
Family Life Cycle
l Phases a family goes through in their formation, growth, and final dissolution
– Bachelorhood
– Honeymooners
– Parenthood
– Post-parenthood
– Dissolution
l Explicit basis: marital status, family status
l Implicit basis: age, income, employment
Use-Related Segmentation
l Rate of Usage
– Heavy vs. Light
l Awareness Status
– Aware vs. Unaware
l Brand Loyalty
– Brand Loyal vs. Brand Switchers
Usage-Situation Segmentation
l Segmenting on the basis of special occasions or situations
l Example Statements:
– Whenever our son will graduate, we will take a pleasure trip to Hawaii.
– When I’m away on business, I try to stay at a suites hotel.
– I always buy my wife/girl friend flowers on Valentine’s Day.
Ad Designed to Spell Out
Rewards of Consumer Loyalty
Occasion-
Specific
Ad
Benefit Segmentation
l Segmenting on the basis of the most important and meaningful benefit
– Prudential – financial security
– Iomega – data protection
– Wheaties – good health
– Eclipse – fresh breath
Ad Offering
Combined Benefits