marketing_exam2_studyguide - Chapter 9 Segmentation...

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A market consists of people and organizations with the necessary purchasing power, willingness, and authority to buy. Consumer products: are purchased by the ultimate consumer for personal use (magazine, coffee, cell phone, sports tickets) Business products: are purchased for use directly or indirectly in the production of other goods or services for resale (rubber for tires, cotton for clothes) If u wants to determine the classification of an item, just think about who is going to buy the product, who will use it, how and why the product will be used. Target market: is the specific segment of consumers most likely to purchase a particular product. Market segmentation: is the process of dividing a total market into several homogeneous groups. It is used in identifying a target market for a good or service. Segmentation is the key to deciding a marketing strategy. The role of market segmentation is to identify the factors that affect purchase decisions and then group consumers according to the presence or absence of these factors. 4 Criteria for effective segmentation: 1. The segment must have measurable purchasing power and size 2. Marketers can find a way to promote to and serve the market 3. Marketers must identify segments large enough for profit potential 4. The firm can target a number of segments that match its marketing capabilities Geographic Segmentation: dividing an overall market into homogeneous groups based on their locations. Marketers usually use geographic segmentation when regional preferences exist and when demand for categories of goods and services vary according to geographic region. Demographic Segmentation ( also called socioeconomic segmentation) : defines consumer groups according to demographic variables such as gender, age, ethnic group, family life cycle, household type, income and expenditure patterns which are the major categories. Psychographic Segmentation: divides a population into groups with similar psychological characteristics, values, and lifestyles – a person’s mode of living, needs, motives, perception, and attitudes to identify market segments. VALS: divides consumers into 8 psychographic categories: innovators (high resources and high innovation), thinkers, achievers, experiences, believers, strivers, makers, and survivors (low resources and low innovation. There are 3 primary motivations: principle- motivated consumer who has set of ideas and morals (thinkers and believers), achievement-motivated consumers influences by symbols of success (achievers and strivers), and action-motivated consumers who seek physical activity, and adventure (experiencers and makers).
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Product-Related Segmentation: dividing a consumer population into homogeneous groups based on their relationships to the product. Segmenting based on the benefits ppl seek when they buy a product. It groups consumers
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marketing_exam2_studyguide - Chapter 9 Segmentation...

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