Market segmentation flashcards

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Market segmentation?

Dividing a market into distinct groups with similar characteristics or needs.

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Demographic segmentation?

Age, gender, income, occupation, family size.

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Geographic segmentation?

Region, country, urban/rural, climate.

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Psychographic segmentation?

Lifestyle, values, personality, attitudes.

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Behavioural segmentation?

Usage rate, loyalty, benefits sought, occasion.

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Targeting?

Choosing which segment(s) to focus marketing resources on.

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Positioning?

How customers perceive the product vs competitors — unique space in the mind.

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Effective segment criteria?

Measurable, accessible, substantial, differentiable, actionable.

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Define Market Segmentation.

The process of dividing a large, heterogeneous market into smaller, more homogeneous sub-groups of consumers with similar needs or characteristics, to whom a separate marketing mix can be applied.

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What are the four main bases for segmenting consumer markets?

1. Geographic (e.g., country, region, climate). 2. Demographic (e.g., age, gender, income). 3. Psychographic (e.g., lifestyle, personality). 4. Behavioural (e.g., usage rate, loyalty).

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Distinguish between a differentiated and a concentrated targeting strategy.

Differentiated marketing targets several segments with a distinct marketing mix for each. Concentrated (niche) marketing focuses all of a firm's resources on winning a large share of just one or a few small segments.

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What is product positioning?

The process of creating a clear, unique, and desirable image and identity of a product in the minds of the target consumers, relative to competing products.

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What is a perception (or positioning) map?

A visual tool used in marketing to show the perceptions of customers or potential customers about a brand and its competitors. It typically uses two determinant attributes as axes, such as price and quality.