2.3 Market Segmentation Flashcards
What is the definition of market segmentation?
Market segmentation is a process where by you split a market up into different sections depending on the customer segments.
How many different types of segmentation are there and what are they called?
There are 4: Geographic Psychographic Behavioural Demographic
What is psychographic segmentation?
This method divides your market up by way of different factors such as interests, lifestyle choices, values and morals.
What is a target market?
A target market is the audience a company wants to sell their product/services to.
What is an advantage of market segmentation and one limitation?
One advantage of market segmentation is that it allows a company to devise a market strategy and it also focuses the company’s aim making the business more successful in the market area.
A limitation is that consumers can be misinterpreted which could lead to a potential bad product or service which could result in the company failing.
What is geographic segmentation?
It is process of market segmentation based on location and specific regions within a certain area of a city or country or even on a global scale
What is demographic segmentation?
This style of segmentation revolves around traits such as age, gender and occupation etc.
What is the purpose of market segmentation and why is it benefiting?
It allows companies to recognise areas where they can potentially receive high yields of profit and it is beneficial as it enables a company to plan and suit their product or service to a particular audience.
How is it used?
It is a marketing strategy which follows the steps in this order Segmentation-> Targeting->Positioning
What is behavioural segmentation?
This is based on the behaviour of customers such as loyalty to companies or how ready they are to purchase goods.
