1. (a) List and discuss the major bases for segmenting consumer markets. Answer: Bases for Consumer Market Segmentation:
There are number of variables involved in consumer market segmentation, alone and in combination. These variables are:
Geographic variables Demographic variables Psychographic variables Behavioral variables
By using any of these segmentation bases, either individually or in combination, an organization can construct market segments for evaluation to help them select appropriate target markets.
In geographical segmentation, market is divided into different geographical units like:
Regions (by country, nation, state, neighborhood) Population Density (Urban, suburban, rural) City size (Size of area, population size and growth rate) Climate (Regions having similar climate pattern)
A company, either serving a few or all geographic segments, needs to put attention on variability of geographic needs and wants. After segmenting consumer market on geographic bases, companies localize their marketing efforts (product, advertising, promotion and sales efforts).
In demographic segmentation, market is divided into small segments based on demographic variables like:
Age Gender Income Occupation Education Social Class Generation Family size Family life cycle Home Ownership Religion Ethnic group/Race Nationality
Demographic factors are most important factors for segmenting the customers groups. Consumer needs, wants, usage rate these all depend upon demographic variables. So, considering demographic factors, while defining marketing strategy, is crucial.
In Psychographic Segmentation, segments are defined on the basis of social class, lifestyle and personality characteristics. Psychographic variables include:
Interests Opinions Personality Self Image Activities Values Attitudes
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