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Market Segmentation Essay

1005 words - 4 pages

ASSIGNMENTESSENTIALS OF MARKETINGBUS 400Prepared forMr. Jimmy KelanaLecturer of Essentials of MarketingPrepared byDevi (B30611231)5th April 2004Kensington Institute IndonesiaMarket Segmentation is the process of dividing a market into direct groups of buyers who might require separate products or marketing mixes. There are several major bases for segmenting the market; they are geographic, demographic, psychographic and behavioral variables.Geographic segmentationGeographic segmentation calls for dividing the market into different geographical units such as nations, regions, states, countries, cities or neighborhoods. In this way of segmenting market, a company should produce and sell the right products in the right geographic areas at the right times.Demographic segmentationDemographic segmentation is the process of segmenting market based on variables such as gender, family size, family life cycle, income, occupation, education, religion, race and nationality. This is the most popular bases for segmenting customer groups because consumer needs, wants and usage rates often vary closely with demographic variables and easier to measure than most other types of variables.• Age and life-cycle stageCompanies who use age and life-cycle segmentation offer different products or use different marketing approach for different age and life-cycle groups. However, marketers must be careful to guard against stereotypes when using this kind of segmentation. Although you might find some 70-year-olds in wheelchairs, you will find others on tennis courts. Thus age is a poor predictor of a person's life cycle, health, work or family status, needs and buying power. Age and life-cycle approach are often use by insurance companies.• GenderThis kind of segmentation has long been used in clothing, cosmetics and magazines. The car industry uses gender segmentation extensively. Women have different frames, upper-body strength and greater safety concerns. To address these issues, car makers are designing cars with hoods and boots that are easier to open, seats that are easier to adjust, and seat belts that fit women better. They've also increased their safety focus, emphasizing features such as air bags and remote door clocks.In advertising, more and more car manufacturers are targeting women directly. In contrasts to the car advertising of past decades, these ads portray women as competent and knowledgeable consumers who are interested in what a car is all about, not just the color.• IncomeIncome segmentation has often been used by the marketers of such products and services as cars, boats, clothing, cosmetics and travel. Many companies target affluent consumers with luxury goods (perfumes, jewellery, bag and many others fine fashion), and inconvenience services but not all companies using income segmentation target the affluent, many companies profitably target low-income consumers. Income alone, however, does not always predict the customers for a given...

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