1.2.3 Market segmentation

Question 1

What is market segmentation?

Answer 1

Breaking down a market into smaller groups, called segments

Question 2

How are markets segmented?

Answer 2

Location
Demographics
Lifestyle
Income
Age

Question 3

How is location segmented?

Answer 3

Grouping customers based on where they live

Question 4

How are demographics segmented?

Answer 4

Group customers based on statistical data relating to the population

Question 5

How is lifestyle segmented?

Answer 5

Grouping customers on how they live their lives and the choices they make

Question 6

How is income segmented?

Answer 6

Grouping customers based on how much they earn, the job they do or their social class (A,B,C1,C2,D)

Question 7

How is age segmented?

Answer 7

Grouping customers according to their age

Question 8

How can you compare products within the market?

Answer 8

Market map

Question 9

What can features of a market map be?

Answer 9

high price-low price
high quality-low quality
large range of services-small range
very colourful-no colour

Question 10

What can a market map allow?

Answer 10

Differentiation
Gaps in the market
Competitors identified