M2 Part 1: Market Segmentation

Question 1

What is Market Segmentation?

Answer 1

• Process of creating small segments within a broad market to select the right target market for various brands

Question 2

Importance of Market Segmentation

Answer 2

• Better understanding of target market and employ best ways to reach them
• Help develop a positioning and marketing mix strategy to satisfy smaller customer group’s needs and wants
• Effective use of financial, communication and distribution resources

Question 3

What is Segmentation by Needs and Wants?

Answer 3

• Based on customer’s functional needs
• Segmentation by Emotive Need: a form of need segmentation based on two other needs: Social and Individual
• Needscope by TNS
• How one looks (expressive; fashion, personal care)
• Gratification (feeling; food, pharma)
• Combination of both (automotive, telecom)

Question 4

What is Segmentation by Socio-Demographics?

Answer 4

• Demographics: quantifiable statistics of a given population
• Age, Gender, Civil Status, Income, Education, Profession (incl. Location and Density), Geography, Family Size, Religion, Nationality, and Climate

Question 5

What is Segmentation by Psychographics?

Answer 5

• Market segmentation based on social class, lifestyle, or personality characteristics
• Segmentation by Lifestyle: consumer pattern of living (Activities, Interests, Opinions)
• Segmentation by Personality: use of personality variables to identify and analyze market segments
• Types of Personalities (Segmented): - Mainstreamers (Seek Security) -Aspirers (Seek Status)
• Succeeders (Seek Control)
• Resigned (Seek Survival)
• Explorers (Seek Discovery)
• Strugglers (Seek Escape)
• Reformers (Seek Enlightenment)

Question 6

What is Segmentation by Consumer Behavior?

Answer 6

• Grouping of consumers based on their Usage, Attitude, Image of the product
• Also grouped based on Occasions, Benefits Sought, User Status, Usage Rates, Loyalty Status, and Buyer-Readiness Stage