Demographic segmentation financial definition of demographic. It helps clarify your vision, have more direction with future advertising plans, and optimize your resources, time, and budget. One faction within the market may be recognized by gender, while another may be made up of purchasers within a certain age category. Marketing segmentation strategies can be cultivated through an extensive choice of attributes found among purchasers.
Demographic segmentation is market segmentation based on various demographic factors, like age, gender, social class, etc. Demographic segmentation slices the market on demographic variables like age of the customer, gender, income, family life cycle, educational qualification, socioeconomic status, religion etc. Demographic segmentation is market segmentation according to age, race, religion, gender, family size, ethnicity, income, and education. Basic explanation of demographic segmentation with examples. The b2b marketing platform may focus on leads who have signed up for one of their free webinars. The authors examined the implicit assumptions made in previous age and genderrelated studies. If 85% of your clients range from 2035 years old, this is the segment youre going to target. Demographic segmentation is one of the simplest and most commonly used forms of segmentation because the products and services we buy, how we use those products. The advantage to marketing management is that this technique divides total demand into relatively homogeneous segments which are identified by some. It helps the firm divide the market into several segments or groups, each having a common variable, and target each of these. As the same diagram powerpoint template series, you can also find our data mining. This is not an example of the work written by professional essay writers. Evaluate market segments by linking consumer behaviors for shopping, financial, media and much more, to gain powerful insights that allow you to create actionable strategies and tactically execute while benchmarking your performance. What are the best sites to find free market segmentation data.
Demographic segmentation involves dividing the market into groups that are. The marketers of clearblue advanced pregnancy test, a product that can tell you if youre oneweek, twoweeks, or threeplus weeks pregnant, asked a couple of dlist celebrities to tweet out. At its most basic level, the term market segmentation refers to subdividing a market along some commonality, similarity, or kinship. Proper market segmentation is crucial in a business. These include the complete segment profile on demographic, psychographic, product usage, perceptions and preferences, attitudes and the like. After completing this chapter, student should be able to understand. American journal of business education june 2011 volume 4. It helps you categorize your target market quickly and understand their patterns easily. Demographic segmentation definition, importance, advantages. Market segmentation 223 globalization of business expands the scope of operations and requires a new approach to local, regional and global segments. Demographic segmentation is defined as a market segmentation method based on variables such as age, gender, income etc. Demographic segmentation allows you to get more specific with your marketing strategies. Market segmentation theorists outline the major mistakes companies make in their marketing strategies. This demographic market analysis can assist with two main objectives.
Jan 11, 2019 market segmentation is a marketing strategy that divides consumers interests, demographics and behavior into different groups to better market to specific needs. There are several companies that integrated geographical market segmentation into their advertising and marketing arsenal. To receive accurate results, you need to create your demographic questionnaires carefully. Its aim is to identify and delineate market segments or sets of buyers which would then become targets for the companys marketing plans.
Marketer will identify the customer need and want then only decide if it is practical to develop marketing mix to satisfy those wants. Demographic segmentation consists of demographic factors such as age, ethnicity, nationality, occupation. Demographic segmentation is the process of dividing your market into segments based on things like ethnicity, age, gender, income, religion, family makeup, and education. Your marketing strategy pays off when you direct them to the right crowd. The more precise the segmentation strategy that a marketing department uses to effectively. Market segmentation in businesstobusiness offerings takes into account two major subsets of interrelated variables organisational and buyer characteristics. Develop strong positions in spealized market segment. One of the mistakes may be the segmentation of a segment. See how you can leverage market segmentation by learning. This free study guide has been prepared to meet the information needs of universitylevel marketing students throughout the world. Market segmentation is a decisionmaking process that involves dividing a market of potential customers into different groups. Moreover, businesses that have not traditionally embraced marketing in general or segmentation in particular, see it as imperative for success and even survival. Secondly we present consumer segmentation by demographic segmentation, behavioral segmentation and geographic segmentation.
May 01, 2016 analyze your competitive advantages and disadvantages through market segmentation and the five level of market competition and learn how to position your product. Market segmentation, market target and market positioning of nike company. But if you are in the business aspect, you would surely need this document for your market segmentation process. Market segmentation is now new and has been used by marketers since the late 1900s. Gain useful insights on demographic market segmentation in this article. Analyze your competitive advantages and disadvantages through market segmentation and the five level of market competition and learn how to. Demographic segmentation examples include age, gender, income, religion, race and nationality. As you might expect, demographic segmentation variables are amongst the most popular bases for segmenting customer groups. Market segmentation is the activity of dividing a broad consumer or business market, normally consisting of existing and potential customers, into subgroups of consumers known as segments based on some type of shared characteristics. Demographic segmentation meaning, factors and example. Demographic market segmentation splits the market into different demographic categories, like age, race, nationality, religion, gender, marital status, social class, ethnicity, income, occupation, lifestyle, and education. Demographic segmentation divides the market on the basis of demographic variables like age, gender, marital status, family size, income, religion, race, occupation, nationality, etc.
This helps in creating groups exhibiting a similar need and want. One faction within the market may be recognized by gender, while another may be made up of. Market segmentation, market target and market positioning of. The demographic segmentation is often used in market segmentation for the. Firstly we have the bases for segmenting consumer markets. Market segmentation, market target and market positioning.
Locality is another general element in market segmentation, along with. Market segmentation when the term market segmentation is used, most of us immediately think of psychographics, lifestyles, values, behaviors, and multivariate cluster analysis routines. Dec 19, 2018 definition of demographic segmentation. Well address the development of market segmentation, how it serves as the foundation of a marketing strategy, the types of segmentation to consider and the process of developing a market segmentation strategy. That is, the members of a market segment share something in.
That is why it is part of the vital things to discuss in business planning. The 5 main types of variables used for demographic segmentation are as below. Each of the above variable is discussed in detail below. Market segmentation demographics demographic segmentation consists of dividing the market into groups based on variables such as age, gender family size, income, occupation, education, religion, race and nationality. They can segment a market by usage rate, benefit, and psychographic, demographic, or geographic methods.
This is one of the most common segmentation practice among marketers. Our focus is on consumer markets rather than business markets, but most of the following concepts also apply to b2b. Pdf businesses may not be in a position to satisfy all of their customers, every. Read on the following geographic factors for market segmentation and learn how you can emulate the following companies success or avoid the pitfalls that they have fallen victim of. Market segmentation is a crucial marketing strategy. List of books and articles about market segmentation online. Demographic segmentation is seen almost in every industry like automobiles, beauty products. Dec 18, 2019 segmentation generally divides a population based on variables. Market segmentation is a marketing strategy that divides consumers interests, demographics and behavior into different groups to better market to. The partition allows companies to identify a target market and generalize the needs of the consumers based on their group. Thus demographic segmentation too has its own variables such as age, gender, family size, income, occupation, religion, race and nationality. Basic explanation of demographic segmentation with.
Market segmentation template free powerpoint templates. The management can respond to meet changing market demand. There are free sites in which you can create surveys, post it in social media groups with some benefits or interest to the members, gather data and export it to excel. Check your understanding of characteristics of market segmentation in this worksheet and quiz. While retail activity here reflects many of the global trends, it also highlights the often regionally concentrated demographic segmentation of the consumer market the composition of which varies from region to region, demanding a targeted portfolio approach for successful goto market strategies, explained dr fabel. Market segmentation is a much broader concept, however, and it pervades the practice of business throughout the world.
Using different types of market segmentation allows you to target customers based on unique characteristics, create more effective marketing campaigns, and find opportunities in your market. Age and genderbased market segmentation studies have appeared frequently in the travel literature. Market segmentation wharton faculty platform university of. The definition of market segmentation, why it matters and the nuts and bolts of how to do it will be presented within this blue paper.
Demographic segmentation sorts a market by demographic elements such as age, education, income, family size, race, gender, occupation, nationality, and more. The word demographic is derived from demography, meaning the study of population. Although some may think of it as outdated, it is still a cornerstone part of marketing strategy and planning. Market segmentation is the process of dividing a target market into smaller, more defined categories.