Getting to Know YouConsumer SegmentationSituation AnalysisA research based analysis of all the internal and external factors that affect the organizationConsumer SegmentationOverall purpose – Achieve the greatest amount of sales with the least amount of expenseReasons for consumer segmentationWasteful and inefficient to market to everyone with the same productThe Company can not develop separate products for each consumerFactors Leading to SegmentationIntroduction of the marketing conceptDiversity of consumer needsHigher standard of livingHigher order needsIncreased competitionMarketplace creates demand for new productsAspects of SegmentationClassifying consumers into potentially profitable groupsDeveloping strategies that will appeal to those groupsConsumer ClassificationEnduring variablesVariable that stick with the consumer at any point in time regardless of the product being purchased.Useful for describing purchase behavior for a variety of product categoriesDemographicsStatistical study of population sizeAgeGenderRaceHousehold incomeEducation levelGeographicRegional difference in consumption patterns and brand preferencePsychographicsLifestyleAttitudesInterestsOpinionsDynamic VariableSpecific to an individual’s relationship with a productUseful for message development and positioning strategiesHeavy vs. Light Users80/20 rule80% of sales come from 20% of customersEarly Vs. Late AdoptersDifferent people try a product for the first time at different point in timeYoungerHigher educatedHigher incomeRisk takersEnd useDifferent consumer purchase the same product for different end usesBrand Loyal vs. Brand SwitchingThe use of one brand of product to the exclusion of all othersRegular or periodic shifting of brand purchase behaviorBrand loyal are the most sought after consumersBenefit SegmentationDifferent Consumers seek different primary benefits from the same productADV 3008 Lecture 3 Outline of Last Lecture I. Levels of Involvement a. No involvementb. High involvement c. Low Involvement II. Types of Agencies Outline of Current Lecture III. Consumer Segmentationsa. Reasons for consumer segmentationb. Factors leading to segmentationc. Consumer Classification Current LectureGetting to Know You Consumer Segmentation ← Situation AnalysisA research based analysis of all the internal and external factors that affect the organization Consumer Segmentation Overall purpose – Achieve the greatest amount of sales with the least amount of expense Reasons for consumer segmentationWasteful and inefficient to market to everyone with the same product The Company can not develop separate products for each consumer ← Factors Leading to Segmentation Introduction of the marketing concept o Diversity of consumer needsHigher standard of living o Higher order needs Increased competition o Marketplace creates demand for new products Aspects of Segmentation- Classifying consumers into potentially profitable groups - Developing strategies that will appeal to those groupsConsumer Classification - Enduring variableso Variable that stick with the consumer at any point in time regardless of the product being purchased. o Useful for describing purchase behavior for a variety of product categories- Demographics o Statistical study of population size Age Gender Race Household income Education level- Geographic o Regional difference in consumption patterns and brand preference - Psychographics o Lifestyleo Attitudes o Interests o Opinions - Dynamic Variable o Specific to an individual’s relationship with a product o Useful for message development and positioning strategies Heavy vs. Light Users 80/20 rule80% of sales come from 20% of customers Early Vs. Late Adopters Different people try a product for the first time at different point in time - Younger - Higher educated - Higher income - Risk takers End use Different consumer purchase the same product for different end uses Brand Loyal vs. Brand Switching The use of one brand of product to the exclusion of all others Regular or periodic shifting of brand purchase behavior - Brand loyal are the most sought after consumers Benefit Segmentation Different Consumers seek different primary benefits from the same
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