Chapter 9.9, Problem 1LO

Summary Introduction

To classify: The variable on the basis of its segmentation.

Market segmentation refers to the segregation of market into smaller and relatively into a homogenous group.

Explanation of Solution

Classification:

The four segmentations are demographic, geographic, psychographic, and behavioral.

These segments are combined to create a new complete profile of the consumers and which enables the marketers to communicate the value propositions.

Geographic segmentation divides the market into the group of homogenous on the basis of location.

The types of geographic segmentation are as follows:

• Market size:
• Market density:
• Climate:
• Region:

Demographic segmentation refers to the segregation of customers based on the demographic variables.

The 5 most used demographic variables are as follows:

• Gender
• Ethnic group
• Family life cycle
• Age
• Household type

Behavioral segmentation refers to the segregation of individual groups who has the similar behavior like usage rates, level of brand loyalty and others benefits.

The three forma of behavioral segmentation are as follows:

• Usage rates
• Level of brand loyalty, and
• Benefits sought

Usage rates: Segregation based on the amount of purchased products that are light users, heavy users and moderate users.

Level of brand loyalty: Segregation based on the level of loyalty on the brand.

Benefits sought: Full focus on the attributes the consumers seeks and the benefits expected from the services and goods.

Psychographic segmentation refers to the segregation population groups based on the lifestyle factors and values.

The common method used here is conducting a survey by asking the consumers to disagree or agree on a particular survey this will help the researchers to make a life style profiles and also a separate strategy.