Market Segmentation means breaking down the total market into self contained and relatively homogeneous subgroups of customers, each possessing its own special requirements and characteristics. This enables the company to modify its output, advertising messages and promotional methods to correspond to the needs of particular segments. Accurate segmentation allows the firm to pinpoint selling opportunities and to tailors it's marketing activities to satisfy on consumer needs.
Through the process of market segmentation, there are certain variables to identify customer groups, such as needs, income geographical, location, buying habits and other characteristics as well, we can focus on the parts of the market that it can serve best and make great profit.
Importance of Market Segmentation
Due to the fact that resources are limited. Therefore, all business will minimize their resources and maximize their profit to gain their benefit. In order not to waste any times and money on promoting their production in the wrong direction.
Market segmentation is needed to spot their product's market opportunities, gain competitive advantage and target marketing activity on promotion.
Step of Market Segmentation process
*Identify bases for segmenting the market
*Develop profiles of resulting segments
*Develop measures of segment attractiveness
*Select the target segment
*Develop positioning for each target segment
*Develop marketing mix for each target segment
Major Bases For Segmenting Consumer Markets
Geographic SegmentationDividing a market into different geographical units such as type of property, urban, suburban, rural regions, country and climatic zone.
Geo-demographic SegmentationDividing a market into groups based on the notion that people, who live close to one another, within the same physical geography, share broad characteristics of financial means, tastes, lifestyles and purchase habits.
Demographic SegmentationDividing a market into groups based on demographic variables such as age, sex, education, occupation, income, social...