Lecture Marketing management: Chapter 8 – Nguyễn Thị Trang Nhung

1
8
Identifying Market
Segments and Targets


Market Segmentation
Types of Segmentation

80 percent of a
company’s sales...

are generated by 20 percent
of its loyal customers


Section 2.2

Market Segmentation
Mass Marketing Vs. Segmentation
Mass Marketing
Advantages

Disadvantage

• Economics of scale
• Simplified marketing plan

• Competitors can identify
unmet needs and wants
and then steal customers

mass marketing
Using a single marketing strategy to reach
all customers.


Section 2.2

Market Segmentation
Mass Marketing Vs. Segmentation
Niche Marketing
Advantages
• Extremely precise
• Increased chance for
success

Disadvantage
• Cost
– Research
– Production
– Packaging
– Advertising


Chapter Questions
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What are the different levels of market
segmentation?
How can a company divide a market into
segments?
What are the requirements for effective
segmentation?
How should business markets be segmented?
How should a company choose the most
attractive target markets?

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8-5


Effective Targeting Requires…
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Identify and profile distinct groups of buyers
who differ in their needs and preferences
Select one or more market segments to enter
Establish and communicate the distinctive
benefits of the market offering

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8-6


What is a Market Segment?
A market segment consists of a group
of customers who share a similar set of
needs and wants.

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8-7


Segmenting Consumer Markets
Geographic
Demographic
Psychographic
Behavioral

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8-8


Market Segmentation

Market Segmentation
Types of Segmentation
Demographic

Geographic

Psychographic

Age

Local

Attitudes

Gender

State

Opinions

Income

Regional

Interests

Marital status

National

Activities

Ethnic background

Global

Personality

Behavioral
Shopping
Patterns
Decisionmaking process

Values

demographic

psychographic

Statistics that describe a population in
terms of personal characteristics such as
age, gender, income, marital status, and
ethnic background.

Grouping people with similar
attitudes, interests, and opinions, as
well as lifestyles and shared values.


Market Segmentation

Types of Segmentation

Demographics

+

Psychographics

+

Geographics

geographics
Segmentation of the market
based on where people live.

=

Comprehensive
Customer Profile


Section 2.2

Market Segmentation
Types of Segmentation


Geographic Segmentation

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8-13


Claritas’ Prizm
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Education and affluence
Family life cycle
Urbanization
Race and ethnicity
Mobility

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8-14


Demographic Segmentation
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Age and life cycle
Life stage
Gender
Income
Generation
Social class
Race and Culture

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8-15


Age and Lifecycle Stage

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8-16


Gender and Income

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8-17


Generational Influences

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8-18


Race and Culture

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8-19


Psychographic Segmentation
and The VALS Framework

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8-20


Behavioral Segmentation Based
on Needs and Benefits

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8-21


Behavioral Segmentation:

Decision Roles
Initiator
Influencer
Decider
Buyer
User
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8-22


Behavioral Segmentation:
Behavioral Variables
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Occasions
Benefits
User Status
Usage Rate

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Buyer-Readiness

Loyalty Status
Attitude

8-23


Figure 8.2 Example of a Brand Funnel

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8-24


Loyalty Status
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Hard-core
Split loyals
Shifting loyals
Switchers

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