In general when we take some bigger task to do or some food in bigger size, then we do divide it into different parts. For Ex: If we are having Pizza of Bigger in size then we make it into small pieces and enjoy slowly. Hence the theme is that if we have anything handy then the concentration will be more on that. And the same can be applicable in marketing too.
Hence, Segmentation of Market is "Dividing the market into different groups depending upon the buyer's needs, behavior and specifications or characteristics where in turn they may require different products under the marketing mix". Hence to make it more simple dividing the market into smaller segments so that the company can reach it more effectively and efficiently. The Segmentation can be of different types, such as segmenting consumer market, Business market in domestic and International market.
Hence if we segment consumer market then it can be classified on the variables like Geographic, Demographic, Psychographic and Behavioral segments. Geographic Segmentation is to divide the market depending upon the region, state or nation. It helps the company to concentrate on that specific area. For Ex: The company like Harley Davidson was not concentrating India before but now it has segmented India as one of the key market and started their operations in the metros of India. This strategy helps them to concentrate in the metros at first and then to move depending upon the profits. Demographic variable is to divide into different groups depending upon age, sex, family size and life cycle, income and occupation, education, religion etc. For Ex: Reebok (The Shoe Company) has divided its product into different segments like Kids, Adults (For Men and Women). And we can take another example of Fairness creams where the companies used to concentrate only on women market but now even they are concentrating on Men market too. It shows the Gender segmentation. Dividing the group depending upon the Income too. For Ex: Harley Davidson (Automobile company) concentrates only on higher income group.
Psychographic segmentation is to divide the market into different groups depending upon Social Class, Lifestyle and personality characteristics. It is like the opinions, Interests and attitudes of the customers. Hence depending upon these variables the company makes segmentation of the market. Even Behavioral and occasional segmenting falls under this category. Behavioral segmentation is to divide the market depending upon the consumer's attitude, knowledge and use. And the same way for Occasional segmentation where the company divides it into different groups depending upon the buyer's idea to buy, purchase time etc. For Ex: Most of the people in India buy Home appliances during diwali. Hence depending upon that the segmentation and positioning of the product takes place.
Segmenting Business market also takes the same kind of variables into account with a value addition of Customer operations, purchasing styles or approaches etc. For Ex: Microsoft divides its product line to Education, Govt., Corporate and Small Medium enterprises. Hence the Business segmentation also takes place in the company depending upon these variables. For International Segmentation the companies which operate in different countries go for it. They go with the same segmentation strategies as that of they apply in domestic too. They segment the complete market depending upon the variables like Political, cultural, Economical, social and Technological. Apart from this the companies even take care of geographical too. But the companies segment the market as of the way they do in their parent location. For ex: MTV segments itself for Teenagers all over the countries wherever they operate. The same way Mercedes Benz gives its best in all the countries of its operations. Hence the companies look at different aspects for the International segmentation.
To make the segmentation more effective, the companies should understand the variables for the segmentation. It should be measurable, Accessible, Profitable, Distinguishable and Attractable. Hence if these parameters are considered well then the segmentation can be good and the companies can easily go ahead for their next process like Targeting and positioning. After the segmentation considering these variables the companies can operate easily in their related segments to make profits. Hence segmenting in different modes according to the buyers need the company can handle the operations in that area so as to get profits from it.
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Reference: Philip Kotler - marketing management.
