Transcript market segmentation

Foundations of Marketing
MARKET
SEGMENTATION
CREATORS: Hayley Ebden
Jade Aitken
Kim Colville
24.10.2012
STP Process
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The STP PROCESS is a method by which the
markets are sub-divided into different segments:
- SEGMENTATION
- TARGETING
- POSITIONING
MARKETING SEGMENTATION is one of the
most fundamental concepts in marketing.

Definition of Market Segmentation:
The division of prospective buyers into
IDENTIFIABLE and DISTINCT GROUPS,
otherwise known as SEGMENTS, that have
COMMON CHARACTERISTICS and
NEEDS and RESPOND in a similar way to a
MARKETING ACTIONS.
Marketing Segmentation
Global Market
Market
Segmentation
Advantages/Benefits of
Market Segmentation

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Enhances a company’s competitive position by
providing focus and direction for marketing
strategies.
Examines and identifies growth opportunities in the
market through the identification of new customers,
growth segments or new product uses.
More effective and efficient matching of company
resources to targeted market segments promises
greatest return.
Market Segmentation in
Consumer Markets

There are 3 main approaches:
PROFILE
- Demographic
- Socio-Economic
- Geographic
PSYCHOLOGICAL
- Lifestyle
- Personality
- Perceptions
- Attitudes
- Motives
- Benefits Sought
BEHAVIOURAL
- Purchase/Transaction
- Consumption/Usage
- Media Usage
- Technology Usage
Profile
(WHO & WHERE)
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Building up knowledge of your customers and potential customers

Understanding your target audience i.e. age, location, life-stage, income
band, property value and lifestyle choices.
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Gain an understanding of how customers interact with your products and
services

Establish the way clients currently perceive your products and services
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Three main profiles which are broken down as follows:
–
–
–
–
Geographic Profiles
Demographic Profiles
Psychographic Profiles
Behavioural Profiles
Profile Segments of
Paisley
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Better signage and advertising campaigns
Adapting marketing segmentation by investigating and setting up
the three key profiles
Targeting both university and colleague students
Psychological
(WHY & WHO)
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Lifestyle, Personality, Perceptions, Attitudes,
Motives: Analysing consumer activities, interests,
and opinions we can understand individual lifestyles
and patterns of behaviour which in turn affect their
buying behaviour and decision making processes.
On a similar basis, we can also identify similar
product and/or media usage patterns.
Benefits Sought: By understanding the
motivations customers derive from their purchases
it is possible to have an insight into the benefits
they seek from the product use.
Psychological Segments
of Paisley
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The following shows the Social Class to all people aged 16+ in
Paisley Households
Social Class
Total
%
AB Higher & Intermediate Managerial/Admin/Professional
10,752
17.8%
C1 Supervisory, Clerical, Junior Managerial/Admin/Professional
15,492
25.6%
26.4%
C2 Skilled Manual workers
7,497
12.4%
13.4%
D Semi Skilled and Unskilled Manual Workers
11,417
18.9%
17.7%
E On State benefit, Unemployed, Lowest grade workers
15,364
25.4%
22.8%
100.0%
100.0%
Total
60,522
Renfrewshire
%
19.7%
Census 2001, July 2004
Lifestyles (cont...)
Lifestyle Segments
Tourists
Paisley Museum & Art Gallery
The Coats Observatory
The Paisley Pipe Band
Paisley Abbey
Youth
Paisley Beer Festival
Hold Music Concerts in
Paisley
Leisure Facilities
Shoppers
Make Paisley an outlet Centre/Discount Town
Boutique Shops
Farmers Markets
Heath Conscious
Lagoon Sports Complex
Pro-Life Fitness/Curves
Students
More Student Accommodation
Internet Cafes
Paisley Strengths
Large Catchment Area, Substantial Business Base, Thriving University, Existing Retail Base,
Transport Hub
Behavioural
(WHO, HOW, WHERE & WHEN)
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Purchase/Transaction: Data about customer purchases
and transactions provides scope for analysing who buys what,
when, how often, how much they spend, and through what
transactional channel they purchase.
Product Usage: Segments are derived from analysing
markets on the basis of their usage of the product offering,
brand or product category. This may be in the form of usage
frequency, time of usage and usage situations.
Media Usage/Technology Usage: Data on what media
channels are used, by whom, when, where and for how long
provides useful insight into the reach potential for certain
market segments through different media channels and also
insight into their media lifestyle.
Behavioural Segments of
Paisley
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61% of homes in the Paisley area have internet access &
regularly use this media to purchase goods and services.
Products purchased regularly are most often bought at out of
town shopping malls i.e. Braehead & Silverburn or
supermarkets i.e. Morrisons, Tesco, Asda & Sainsburys.
People who shop in Paisley town centre are either elderly or
unemployed.
Behavioural (cont…)
Conclusion