Bases of Market Segmentation

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MARKET SEGMENTATION

Bases for Segmentation in Consumer Markets
Consumer markets can be segmented on the following customer characteristics. * Geographic
* Demographic
* Psychographic
* Behavioralistic

1. Geographic Segmentation
The following are some examples of geographic variables often used in segmentation. Region: by continent, country, state, or even neighborhood
Size of metropolitan area: segmented according to size of population Population density: often classified as urban, suburban, or rural Climate: according to weather patterns common to certain geographic regions 2. Demographic Segmentation

Some demographic segmentation variables include:

Age
Gender
Family size
Family lifecycle
Generation: baby-boomers, Generation X, etc.
Income
Occupation
Education
Ethnicity
Nationality
Religion
Social class
Many of these variables have standard categories for their values. For example, family lifecycle often is expressed as bachelor, married with no children (DINKS: Double Income, No Kids), full-nest, empty-nest, or solitary survivor. Some of these categories have several stages, for example, full-nest I, II, or III depending on the age of the children.

3. Psychographic Segmentation
Psychographic segmentation groups customers according to their lifestyle. Activities, interests, and opinions (AIO) surveys are one tool for measuring lifestyle. Some psychographic variables include: Activities

Interests
Opinions
Attitudes
Values

4. Behavioralistic Segmentation
Behavioral segmentation is based on actual customer behavior toward products. Some behavioralistic variables include: Benefits sought
Usage rate
Brand loyalty
User status: potential, first-time, regular, etc.
Readiness to buy
Occasions: holidays and events that stimulate purchases

Behavioral segmentation has the advantage of using variables that are closely related to the product itself. It is a fairly direct starting point for market segmentation. Market...
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