Quantitative Marketing (Subject) / 3. Segmentation & Targeting (Lesson)

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• Definition: Market Segmentation Market segmentation is the process of dividing customers whose valuations of a product or service vary greatly into groups or segments containing customers whose valuations vary very little within the group but vary greatly among groups. > Applying the marketing concept to market segmentation means differentiating your product and marketing efforts to meet the needs of different segments.
• Primary characteristics of segments Segmentation Bases refer to characteristics that tell us why segments differ. (needs, preferences, solutions) Segmentation Descriptors are characteristics that help us find and reach segments. (demographics, psychographics, behavior, decision making, media patterns)
• Definition: Market A market consists of all the potential customers sharing a particular need or want who might be willing and able to engage in exchange to satisfy that need or want.  > A market is defined by common customer needs, not by a product or technology.
• Phases of STP as a Business Strategy (7) Segmentation 1. Identify segmentation bases and segment the market 2. Develop profiles (description) of resulting segments Targeting 3. Evaluate attractiveness of each segment 4. Select target segments (based on profit potential & fit) 5. Find customers and prospects in target segments Positioning 6. Identify possible positioning concepts for each target segment 7. select, develop and communicate the chosen concept. > to create and claim value!  

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