4 viii market segmentation a market segmentation is

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VIII. Market Segmentation A. Market segmentation is the process of dividing consumers into smaller groups based on their shared characteristics and similar needs and wants. B. Market Segmentation Categories Include: Geographic Segmentation, Demographic Segmentation, and Psychographic Segmentation C. Geographic market segmentation is based on the idea that people who live in the same geographic area will have the same needs and wants. Where are snow-blowers needed? Alaska D. What is the BEST state in the United States for bratwurst sales? Why? Massachusetts Because Boston is famous for bratwursts. E. Which American state eats the most Spam per capita? Hawaii F. After watching the video, explain why Spam is so popular in this state. It is popular because it doesn’t need to be refrigerated and they like the flavor. G. Demographic market segmentation consists of dividing the market based on age, gender, race, income level, ethnicity, educational attainment level, or religious affiliation. H. Generation Z is the demographic segment born between the mid 1990’s to mid-2000’s. I. psychographic market segmentation uses our hobbies, interests, lifestyles, and social values to divide the market. IX. Mass Marketing Vs. Market Segmentation A. mass marketing is used to direct marketing efforts at a very large and diverse group. B. With mass marketing, everyone is considered to be a potential customer. C. However, most products are sold using market segmentation. Companies practicing the marketing concept will use market segmentation. D. A market opportunity is an identified market with excellent potential based on careful research. E. Market potential is the total revenue that can be obtained from a market. F. Consider the market potential of the pet food industry in the United States. Americans spend approximately $30 billion annually on pet food. G. Target markets should be selected from the segments that have the greatest potential. H. A target market is a clearly defined segment of the market which a business or organization wants to appeal to. I. The target market will consist of customers with very similar characteristics to whom the company can sell its products. J. The product can be associated with a personality or type of user of the product. 5
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K. Members of the target market will want to associate themselves with the brand’s image. L. The brand’s promise is what customers can expect from the product – real or imagined. 6
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