Marketing Segmentation

STP: Market Segmentation

• Definition: Dividing a larger market into smaller, distinct groups of consumers with similar needs, characteristics, or behaviors.
• Benefits:
  • Helps businesses understand their target audience better
  • Enables creation of tailored marketing strategies
  • Increases efficiency in resource allocation
• Segmentation Bases:
  1. Demographic Segmentation:
     • Age
     • Gender
     • Income
     • Occupation
     • Education
  2. Geographic Segmentation:
     • Region
     • City
     • Rural/Urban
  3. Psychographic Segmentation:
     • Lifestyle
     • Personality
     • Values
  4. Behavioral Segmentation:
     • Usage rate
     • Loyalty
     • Benefits sought
  5. Firmographic Segmentation (B2B):
     • Company size
     • Industry
     • Location

STP: Target Market Identification

• Definition: Selecting a specific segment of the market to focus on, based on criteria such as size, growth potential, and competitiveness.
• Target Market Identification Process:
  1. Segmentation: Divide the market into distinct segments
  2. Segment Evaluation: Assess each segment's attractiveness based on factors such as size, growth rate, and profitability
  3. Segment Selection: Choose the most attractive segment(s) to target
• Target Market Characteristics:
  • Size: Large enough to be profitable, but small enough to be manageable
  • Growth Potential: High growth rate or potential for future growth
  • Competitiveness: Low competition or opportunity to differentiate
  • Accessibility: Easy to reach and communicate with the target market
  • Actionability: Ability to develop marketing strategies that appeal to the target market

STP: Market Segmentation

• Market segmentation is the process of dividing a larger market into smaller, distinct groups of consumers with similar needs, characteristics, or behaviors.
• Benefits of market segmentation include:
  • Better understanding of the target audience
  • Creation of tailored marketing strategies
  • Increased efficiency in resource allocation
• There are five bases for market segmentation:

Demographic Segmentation

• Age
• Gender
• Income
• Occupation
• Education

Geographic Segmentation

• Region
• City
• Rural/Urban

Psychographic Segmentation

• Lifestyle
• Personality
• Values

Behavioral Segmentation

• Usage rate
• Loyalty
• Benefits sought

Firmographic Segmentation (B2B)

• Company size
• Industry
• Location

STP: Target Market Identification

• Target market identification is the process of selecting a specific segment of the market to focus on, based on criteria such as size, growth potential, and competitiveness.
• The target market identification process involves:

Segment Evaluation

• Assessing each segment's attractiveness based on factors such as size, growth rate, and profitability

Segment Selection

• Choosing the most attractive segment(s) to target
• Characteristics of a target market include:

Ideal Target Market

• Size: large enough to be profitable, but small enough to be manageable
• Growth potential: high growth rate or potential for future growth
• Competitiveness: low competition or opportunity to differentiate
• Accessibility: easy to reach and communicate with the target market
• Actionability: ability to develop marketing strategies that appeal to the target market

Divide a larger market into smaller, distinct groups of consumers with similar needs, characteristics, or behaviors. Learn about the benefits and bases of market segmentation.