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Retail Marketing Segmentation

This document discusses retail market segmentation. It explains that segmentation involves dividing the total heterogeneous market into homogeneous subgroups with similar needs and behaviors. This allows retailers to customize their products, promotions, and marketing mix for each segment. The document then outlines various ways to segment markets, including by geographic, demographic, psychographic, and behavioral factors. It also discusses the benefits and criteria for effective segmentation.

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mohammed nizar
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8K views15 pages

Retail Marketing Segmentation

This document discusses retail market segmentation. It explains that segmentation involves dividing the total heterogeneous market into homogeneous subgroups with similar needs and behaviors. This allows retailers to customize their products, promotions, and marketing mix for each segment. The document then outlines various ways to segment markets, including by geographic, demographic, psychographic, and behavioral factors. It also discusses the benefits and criteria for effective segmentation.

Uploaded by

mohammed nizar
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPT, PDF, TXT or read online on Scribd
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Retail Marketing

Segmentation
- N. Mohammed Nizar

03/30/09 Nizar
• A market is a group of potential
customers with similar needs who are
willing to exchange something of value
with sellers offering various goods and
services tat can satisfy these needs

Marketer

Mass Marketing Segmentation

03/30/09 Nizar
Market Segmentation
• The process of dividing the heterogeneous
Total market into small group of customers
who share similar set of wants
Ex. Women

Working Housewife

• Different groups have different promotional


strategies and mkg mixes because they have
diff. wants and needs
03/30/09 Nizar
Sub-segments
Women

Working Housewife

Children No Children

• Segmentation helps the retailer to customize the


product and tailor its promotional campaigns

03/30/09 Nizar
Stages in Segmentation

Segmentation Targeting Positioning

3. Choose variable for 3. Decide on targeting 3. Understanding the


segmentation market 4. Identify which target segment
2. State a profile of segments will be 2. place offering in the
Segment Targeted mind of the target
3. Verify prospective 3. How many segment segment
segment should be targeted 3. Evolve mkting mix

03/30/09 Nizar
Benefits
• Development of Marketing Mix
• Store location decisions
• Understand customer behavior
• Merchandising decision
• Promotional campaigns
• Positioning

03/30/09 Nizar
Criteria for effective segmentation
• Homogeneous within
• Heterogeneous between
• Substantial
- should be large enough
• Actionable
• Accessible
• Measurable

03/30/09 Nizar
Dimensions for Segmentation

• Geographic
• Demographic
• Psychographic
• Behavioral

03/30/09 Nizar
SEGMENTATION BASE SELECTED SEGMENTATION VARIABLES
Geographic Segmentation
Region Southwest, Mountain States, Alaska, Hawaii
City Size Major metropolitan areas, small cities, towns
Density of area Urban, suburban, exurban, rural
Climate Temperate, hot, humid, rainy
Demographic Segmentation
Age Under 11, 12-17, 18-34, 35-49, 50-64, 65-74, 75-99, 100+
Sex Male, female
Marital status Single, married, divorced, living together, widowed
Income Under $25,000, $25,000-$34,999, $35,000-$49,999,
$50,000-$74,999, $75,000-$99,000, $100,000 and over
Education Some high school, high school graduate, some college,
college graduate, postgraduate
Occupation Professional, blue-collar, white-collar, agricultural,
military

03/30/09 Nizar
SEGMENTATION BASE SELECTED SEGMENTATION VARIABLES
Psychological Segmentation
Needs-motivation Shelter, safety, security, affection, sense of self-worth
Personality Extroverts, novelty seeker, aggressives, low dogmatics
Perception Low-risk, moderate-risk, high-risk
Learning-involvement Low-involvement, high-involvement
Attitudes Positive attitude, negative attitude
Psychographic
(Lifestyle) Segmentation Economy-minded, couch potatoes outdoors enthusiasts
status seekers
Sociocultural Segmentation
Cultures American, Italian, Chinese, Mexican, French, Pakistani
Religion Catholic, Protestant, Jewish, Moslem, other
Subcultures (Race/ethnic) African-American, Caucasian, Asian, Hispanic
Social class Lower, middle, upper
Family life cycle Bachelors, young married, full nesters, empty nesters

03/30/09 Nizar
Values
• Refers to belief system
ex. Benetton targeted customers who value protection of
environment, it encourages recyclable packaging and
refill services

• Cultural values

03/30/09 Nizar
VALS
• Begins with people instead of products
• Classifies people by their unique style of
living
• It then determines how marketing factors
fit into their lives
- The self-driven materialists
- the independent Explorer
- The Passive traditionalist
- The enthusiastic experiments
- The mature Sensible
03/30/09 Nizar
Behavioral
• Reason/ occasion for purchase
• Frequency of purchase
• Quantity of purchase
• Product usage
• Loyalty status
• Buyers readiness stage
• Source of purchase

03/30/09 Nizar
Market Targeting
• Choosing the segment
• Measure the attractiveness and its capacity to
serve in the segment
Factors
• Size of the segment
• Purchasing power
• Growth rate
• Presence of competition
• profitability
03/30/09 Nizar
Customer Profile
Profiles help the retailer in understanding
the needs of the target segments and its
shopping behavior
• Customer demographics
• Family decision making
• Psychographics
• Purchsing behavior
• Motivation for purchase
• Purchasing process
• Time utility
• Space utility
03/30/09 Nizar

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