Market Segmentation

"The marketer should stop thinking of his customers as part of some massively homogeneous market. He must start thinking of them as numerous small islands of distinctiveness, each of which requires its own unique strategies in product policy, in promotional strategy, in pricing, in distribution methods, and in direct selling techniques.” T. Levitt, Marketing for Business Growth, Mc Graw Hill, New York, 1974, p. 69

Market Segmentation The overall market is divided into distinct groups of buyers who are likely to respond favorably to different market mixes.

Levels of Market Segmentation Mass Marketing Same product to all consumers (no segmentation) Mass Marketing Same product to all consumers (no segmentation) Segment Marketing Different products to one or more segments (some segmentation) Segment Marketing Different products to one or more segments (some segmentation) Micromarketing Products to suit the tastes of individuals and locations (complete segmentation) Micromarketing Products to suit the tastes of individuals and locations (complete segmentation) Niche Marketing Different products to subgroups within segments (more segmentation) Niche Marketing Different products to subgroups within segments (more segmentation) Local Marketing Tailoring brands/ promotions to local customer groups Individual Marketing Tailoring products/ programs to individual customers

Demographic Segmentation Age Income Gender Race Marital Status Education

Geographic Segmentation City Zip Code State Region Country

Psychographic Segmentation Social Class Life Style Attitude Values Interests Personality

Usage Segmentation How do customers use your product? Light Medium Heavy Consumer Commercial Industrial