[“Consumer Behavior sixth edition “( Leon G. Schiffman, Leslie Lazar Kanuk)]
Market segmentation has a lot of segments. The most important segments are Geographic, Demographic, and Psychographic. Every segment of these divided in many subfamilies.
Then I will explain all the segments and I will try to identify the positive and negative things that they have.
Geographic segmentation
“In geographic segmentation, the market is divided by location. The theory behind this strategy is that people who live in the same area share some similar needs and wants and that these needs and wants differ from those of people living in other areas. For example, certain food products sell better in one region than in others (e.g., cream cheese and frozen waffles tend to sell better in the Northeast, Japanese food and soy sauce in the Northwest, and cake mixes and cottage cheese in the Midwest and mountain states)
Some regional consumption differences can be accounted for by climate. The Sunbelt regions of the South and West represent better opportunities for selling bathing suits and in-ground pools than the snowbell regions of the North and East, where snow blowers and children's sleds are likely to be better sellers.¨ (“Consumer Behavior”Leon G 1997)
Cerographic segmentation is divided in follow subgroups:
Region that includes the North, South, East, West, and city size (Major metropolitan, areas, small cities, towns).Moreover Density of area (Urban, suburban, exurban, rural) and Climate . (“Consumer Behavior”Leon G 1997)
Demographic segmentation
“Demographics are the most common basis for segmenting consumer markets. Marketers' preference for using demographic data to segment markets rests on the relative ease of measuring them as well as their close link to demand for many products and services. Demographic variables such as age, stage in the family life cycle, gender, income, occupation, education, religion, nationality, and race are commonly used by marketers because they usually correlate with consumer preferences, needs, and usage rates. For example, gender is an important segmentation variable in the case of clothing, cosmetics, skin-care products, and hair-coloring products. Similarly, stage in the family life cycle is important in determining the need for housing, furniture, appliances, children's products and services, and long-distance phone services.
Another reason for the value of demographic variables as a basis for market segmentation is the wealth of demographic data available from numerous sources, including the U.S. Census Bureau and various commercial and noncommercial entities such as Simmons Market Research and Donnelley Demographics. Demographic data are easily acquired and quite simple to use”(“Consumer Beahavior”Nessim Hanna 2000)
Psychographic segmentation
“Although age, family life cycle, gender, occupation, and other demographic variables are usually helpful in developing segmentation strategies, they often fail to paint a precise picture of different market segments. For example, there is little correlation between demographics and such things as consumer desire to travel, propensity for movie going, preferences for music, enthusiasm for sports, choice of investment opportunities, and affinity for smoking and drinking. These tendencies can, however, be explained through psychographic segmentation, which is the partitioning of the market based on consumers' lifestyle and personality characteristics.
Psychographic profiles, descriptive sketches of individuals' lifestyles, are commonly obtained by having people respond to a battery of statements designed to reveal their Activities, Interests, and Opinions, hence the name AIO inventories. For example, an AIO inventory may include statements such as "I'd rather spend a quiet evening at home than go out to a party" and "I'd feel lost if I were alone in a foreign country." Respondents indicate how strongly they agree or disagree with each statement, usually on a six-point scale. Responses are then cluster analyzed and results are cross-tabulated with a particular purchasing behavior of interest to the researcher. For example, a psychographic study may correlate ownership of foreign automobiles or interest in certain magazines to specific personality traits.
The Discovery Channel and Learning Channel conducted a study of Info-Set Viewers—those who watch at least a half hour of either channel per week.23 These viewers, who make up 68 percent of cable TV subscribers, were segmented into eight subgroups and given names such as Entertain-Me viewers, Practical, Scholars, Sociologists, Boy Toys, Machos, Here and Nows, and Escapists. Discovery found the study helpful in tailoring programming and advertising to different types of viewers.
Gaines, formerly a pet foods division of General Foods, conducted a psychographic study of dog owners to classify households according to how they felt about their pets and to tie these feelings to the type of food a household's pets were fed most often.2 In this investigation, five psychographic types of dog owners were identified. Functionalist owners, who kept a dog as a means of self or property protection, accounted for approximately 40 percent of the dog owners. These individuals showed little attachment to their dogs. Family Mutt owners, whose dogs served as pets for their children, represented about 25 percent and showed just somewhat more interest in their dogs. Baby Substitute owners, for whom a dog took the place of a child or a spouse, accounted for about 10 percent. They showed above-average attachment to their dog. Nutrition list owners, such as breeders and consumers who were themselves diet conscious, accounted for about 13 percent and were very personally attached to their dogs. Finally, Middle of the Road owners, about 12 percent of dog owners, showed no distinctive characteristics”. (“Consumer Beahavior”Nessim Hanna 2000)
Gaines found strong correlations between these psychographic categories and use of commercial dog food products. Members of the Baby Substitute and Nutrition list categories bought the least amount of commercial dog food, whereas members of service deal. Similarly, airlines, car rental companies, and hotels attempt to lure frequent business travelers, who constitute the heavy users of their services, via upgrades, discounts, and frequent-flier programs.
To attract nonusers, firms often rely on sales promotion in various forms such as product samples, coupons, rebates, bonus-size packages, premiums, and outright price reductions. Weight Watchers, for example, created a program called Winners through which new members can accumulate points redeemable for products such as sweatshirts, mugs, beach towels, coolers, and director's chairs. The more Weight Watchers' products and services purchased, the more points participants earn.2
