1.1.2 market segmentation

Question 1

definition market segmentation

Answer 1

identifiable group of individuals or part of a market where customers share one or more characteristics or needs
diving a meaket in smaller groups with similar characteristics/needs

Question 2

market segmentation kinds

Answer 2

Geographic - location
Psychografic - lifestyle
Demographic - age, gender, income
Behavioural

Question 3

what use of it can we use to support market research

Answer 3

websites, social media, databases

Question 4

✅ Advantages of Market Segmentation

Answer 4

Better Understanding of Customer Needs
→ Products/services can be tailored more effectively

Improved Marketing Efficiency
→ Targeted promotions = less waste, better ROI

Competitive Advantage
→ Helps stand out by meeting specific group needs

Customer Loyalty
→ People feel understood and valued = more repeat business

Higher Profits
→ Can charge premium prices for niche markets (less price-sensitive)

Question 5

❌ Disadvantages of Market Segmentation

Answer 5

Higher Costs
→ Customising products and marketing for each segment can be expensive

Complexity in Operations
→ Managing multiple products or strategies can be difficult

Risk of Missing Out
→ Focusing too narrowly might ignore potential customers outside the segment

Data Challenges
→ Requires detailed and accurate market research

Over-Segmentation
→ Splitting the market too much can reduce economies of scale