Market Segmentation

Professor Miranda spoke about market segmentation. I came across this article on market segmentation and the bases on which consumer and industrial markets are segmented.

What is market segmentation?
According to the article, market segmentation is the dividing of the market into homogeneous clusters. This process helps companies tailor their marketing mix depending on the cluster they are targeting. A market can be segmented on different bases and consumer markets are segmented differently from industrial markets.

Segmenting Consumer Markets
Consumer markets can be segmented on the following bases:

1) Geographic - This segmentation is based on variables such as region, climate and population density.
2) Demographic - This segmentation is based on variables such as age, occupation and income.
3) Psychographic - This segmentation is based on variables such as values, attitudes and lifestyles.
4) Behavioural - This segmentation is based on variables such as usage rate and benefits sought.

Segmenting Industrial Markets
Industrial markets can be segmented on the following bases:

1) Geographic - This segmentation is based on variables such as customer concentration and growth rate.
2) Customer type - This segmentation is based on factors such as organization size and industry.
3) Buyer behaviour - This segmentation is based on factors such as loyalty to suppliers and usage patterns.

Article link: http://www.quickmba.com/marketing/market-segmentation/