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Market Segmentation


The term ‘market segmentation’ describes the breaking down of a market into self-contained and relatively homogeneous sub-groups of customers, each with its own special requirements and characteristics. Products and advertising message can then be altered to make them appeal to particular segments.

Markets may be segmented with respect to customers’ location, ages, incomes, social class, or other demographic variables, or according to consumer lifestyle, attitudes, interests and opinions as they affect purchasing behavior.

It does seem that many consumers buy goods that fit in with a chosen lifestyle (healthy, sophisticated, rugged, etc.) and with their perceptions of what they ought to purchase in order to pursue that lifestyle. Once the lifestyle to which potential consumers aspire is identified, advertising message can be modified in appropriate ways.

Differentiated versus undifferentiated marketing strategies

A differentiated marketing strategy requires the firm to modify its products for various market segments and to operate in all sectors. Production and promotion costs are normally higher when this approach is followed.
Concentration strategies involve focusing all attention on one or just a few market segments.

Undifferentiated marketing means that the firm offers exactly the same product using identical promotional images and methods in a wide range of markets. Differences in market segments are ignored. Products are designed and advertised in order to appeal to the widest possible range of consumers.

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