INTRODUCTION
Through market segmentation, companies divide large, heterogeneous markets into smaller segments that can be reached more efficiently and effectively with products and services that match their unique needs.
INSIGHTS
- Mass marketing: Same product to all consumers (no segmentation, i. e. a commodity)
- Segment Marketing: Different products to one or more segments (some segmentation, i.e. Marriott)
BENEFITS
- Geographic Segmentation: International, national, regional / city
- Dividing the market into groups based on variables such as age, gender, family size or life cycle, income, occupation, education, religion, race, generation, nationality
- Divides Buyers Into Different Groups Based on social class, lifestyle, personality
- Dividing the market into groups based on variables such as occasions, benefits, user status, usage rate, loyalty status, readiness stage, attitude toward the product
- Segments must respond differently to different marketing mix elements & programs.
Requirements for effective segmentation:
- Measurable (Size, purchasing power, profiles of segments can be measured),
- Accessible (Segments can be effectively reached and served),
- Substantial (Segments are large or profitable enough to serve), and
- Actionable (Effective programs can be designed to attract and serve the segments).
