1. Market Segmentation and Targeting

2. Determine Segmentation Variables
Demographic Variables
Geographic Variables
Age
Gender
Race
Ethnicity
Education
Occupation
Family size
Social Class
Country
Region
Climate
Terrain
City size
Urban/suburban/rural
Market density
Psychographic Variables
Behavioristic Variables
Benefit expectations
End-use
Volume usage
Price sensitivity
Motives
Lifestyle
Personality attributes

3. Demographic Variables
Age
Gender
Race
Ethnicity
Income
Education
Occupation
Family size
Family life cycle
Religion
Social class

4. Geographic Variables Climate Terrain City size Population density
Urban/rural areas
Market Density
Geodemographic Segmentation (e.g. by zip code or smaller)
Micromarketing

5. Psychographic Variables
Personality characteristics
Motives
Lifestyles
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6. Behavioristic Variables
Dividing a market according to some feature of consumer behavior toward a product
Attitudes towards product
Usage occasion
Benefit Segmentation
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7. Variables for Segmenting B2B Markets
Geographic Location
Location affects the level of product demand.
Type of Organization
Variations in firms’ characteristics leads to segmentation by type.
Customer Size
Different size companies often have different needs.
Product Use
Firms use basic inputs in ways different from one another.
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8. Market Segment Profiles
Describe the similarities among potential customers within a segment
Demographic factors
Geographic factors
Benefits sought
Lifestyle
Brand preference
Usage rates
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9. Evaluate Relevant Market Segments
Sales Estimates
Target Market potential
Forecast – expected sales by target
Competitive Assessment
Who, how many, how large, and how strong?
Cost Estimates
Cost to effectively market to the target segment

10. Select Specific Target Market(s)
Criteria to consider when selecting a Target Market
Market size
Expected growth
Competitive position
Cost to reach segment
Compatibility with firm’s objectives, resources and skills
Forecasted sales

11. Important Note
If ANY SINGLE element of the marketing mix changes in order to reach a specific group, you have created a new segment
Change the product
Change the price
Change the place
Change the promotion