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CONSUMER BEHAVIOUR, FALL 2011

GROUP MEMBERS

ANNIE MOIN

AYAZ ALI SHAIKH

SAVEREENA SULEMAN

TEACHERMISS ALIA HASAN

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MARKET SEGMENTATION

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BECAUSE.

Businesses involve much more than selling products/services and advertise it.

Complex markets consisting customers/consumers each with different ideas,perceptions, buying behaviors, race, religion, age and income etc

Allow marketers of consumer goods and services identify the needs of the market.

Defined segments help the organization in devising marketing strategy,Advertisement, Promotions etc

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Customer segmentation process

Understandthe consumer

need.

Groupcustomers byneed groups.

Identify themost

attractivesegments.

Developunique valuepropositionsby segment.

Developunique Go-To-Market

strategies bysegment.

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BASIS OF SEGMENTATION

Geographic Segmentation

Demographic Segmentation

Psychological Segmentation

Psychographic

Socio-cultural Segmentation

Use-Related Segmentation

Use Situation Segmentation

Benefit Segmentation

Hybrid Segmentation

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Geographic Segmentation

Its market division by location.

People living in the same area share some similar needs and wants.

Consumers needs and wants differ on regional basis(Culture, religion, climate etc)

consumers in different areas may display certain characteristics and behaviorsin that particular region which people in other regions might do not have.

Companies selling products/services would like to know, where their productsare being sold.

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DEMOGRAPHIC SEGMENTATION

Peoples wants and demands vary with respect to different age levels

Gendersegmentation is commonly used within the cosmetics,clothing and magazine industry.

People with different income levels have different buyingbehaviors.

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IS IT THE RIGHT SEGMENT FOR COLGATE??

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PSYCHOLOGICAL SEGMENTATION&

PSYCHOGRAPHIC Marketers divide the total potential market into smaller subgroups on the basisof intrinsic characteristics of the individual, such as personality, lifestyle, attitudes orinterests.

Psychographic is aimed at describing the accurate profile of required segment.

Here markets are divided on the basis of the psychology and lifestyle habits ofcustomers.

marketing a product requires a deep understanding of the customerspsychology, along with their needs, in order for the product to be accepted.

Psychographic Segmentation Variables, Interests, Activities, Opinions,Behavioral patterns, Habits, Lifestyle, Perception of selling company, Hobbies

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Socio-cultural segmentation

Social Class

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Culture &Subculture

Culture: Cultural tend to share same

values, beliefs and customs

Sub culture: Subgroup are often united by

certain experiences, values orbeliefs

Global marketsegmentation:

Same type of productregardless of which nation

they belong. Due to true globalmarket place people living inone country or region used

the product manufactured inother country.Sou

rce:consumerbehavior

-L.Schiffman&L.kanuk

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RELIGION

Influencing the buying pattern or preference

of consumer in purchase decision. Eid, Diwali, Christmas and religious festival

occasion.

Sourc

e:consumerbehavior-L

.Schiffman&L.kanuk

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FAMILY LIFE CYCLE

A composite variable reflects relative age,

income, and employment status.

Representing an important target segment

E.g.: Bank al Habib, insurance company.

Key consumer related roles - information

gather, influencer, user, decider,

maintainers and disposers.

Roles often are influenced by familys

lifestyle and cultural factors.

Sourc


.Schiffman&L.kanuk

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SOCIAL CLASS: Combination factors are occupation, income,

education, wealth.

Three methods of measurement

1. subjective measure-individual self-

perception,2. reputational measure-individual perception

for other

3. objective measure use specific socio-economicmeasure (single variable index or composite

variable index).

MCB service to B2B, B2C

Southwest Air Line, B2B, B2CSourc


.Schiffman&L.kanuk

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Rate of usage segmentation:

Finds out consumer behavior anddifferentiate among heavy user,medium user, light user and non

user of product and services.

Tooth brush and mobile package.

Awareness status: Consumer rate of awareness, level

of interest in the product andwillingness to buy the product.

Nesvita milk

Use-Related segmentation

Source:consumerb

ehavior-L.Schiffman&L

.kanuk

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Use-Situation Segmentation

On the basis of occasion or situation

marketers determine what consumers will

purchase or consume.

Sourc


.Schiffman&L.kanuk

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Benefit Segmentation

Product or service benefits

Changing life style directed to benefits

Used for positioning of various brandwith in the same category.

Sourc


.Schiffman&L.kanuk

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Hybrid Segmentation

Combining several segmentation

Three hybrid segmentation approaches.

Psychographic-Demographic.

Geo-Demographic.Value and lifestyle system.

In Psychographic-Demographic-used in

development of advertisement.

Geo-Demographic-people who lives close to one

another are likely to have similar economic status,

taste ,preferences, lifestyle and consumption habits.

Sourc


.Schiffman&L.kanuk,w

ww.googel.com,www.w

ekipedia.com
http://www.googel.com/http://www.googel.com/http://www.googel.com/http://www.googel.com/http://www.googel.com/http://www.googel.com/http://www.googel.com/http://www.googel.com/http://www.googel.com/http://www.googel.com/http://www.googel.com/http://www.googel.com/http://www.googel.com/http://www.googel.com/http://www.googel.com/

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Value and life style system

Explains the various attitudes towards societyand institutions.

Applies psychographics to businessmanagement.

Away of thinking of consumers beyonddemographics.

Focuses more explicitly on explainingconsumer purchase behavior.

Sou

rce:consumerbehavior-L.Schiffman&L.kanuk,

principleofmarketing

P.Kottler

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Framework An individuals primary

motivations as well as his

resources determines how a person

will express himself/herself in the

market place.

Three primary motivation include :

Principle Oriented (Ideal)

Status Oriented (Achievement)

Action Oriented (Self- expression )

The consumer with in each

orientation further classified into

those with high level of resourcesand low level of resources depends

on income, education, health, self-

confidence, energy and willingness

to buy.

Sou

rce:consumerbehavior-L.Schiffman&L.kanuk

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Finer segmentation

The strategies we use in finer segmentation are:

-micro-segmentation

-mass-segmentation

-verity-seeking strategy.

The bases we used in developing finer segments:

-customized offering

-diverse customer base

-close customer relationships.

StrategicMarketin

g&planning

THE IBM STORY

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32

THE IBM STORY

Sluggish sales in 90s

Segmented on geographic divisions and product-

groups.

Segmentation as an active strategy- in 1991

New segments based on customer needs

1. Insurance Cos.

2. Banks

3. Govt Depts.

4. Retail5. Industry

Regained profitability in 1994.

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IDENTIFIABLE

FAVORABLECOST/

BENEFIT

STABILITYOVERTIME

ACTIONABLE

Criteria forEffective

segmentation

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Identifying segments

Identifying- differentiating the segment

Based on consumer needs

Example anti wrinkle/aging creams

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Actionable/Accessiblesegments

Actionable- resources to reach thesegment/ accessibility

Telenor Easy Paisa:

Transferring of remittances

Bill payment

Easy pay- corporate collection fromcustomers

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Stability over time

Likely to grow larger over time

Rooh Afza in Ramazan

Targeting teens- stable like cosmetics

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Favorable cost/benefit

Sufficiency- segments size justifyingcost and benefit

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The best example

In Pakistan , Tea- oriented people

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French company

Global market share of 27%

Present in 72 countries

Mission: to bring health through food andbeverages

In 1999, focused on 3 categories

BiscuitsWater

Diary

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1999 and 2003- sold its glass containerbusiness

2000- sold beer brand Kronenbourg1964

2002- sold Italian cheese and meatbusiness

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In 2003 refocused on 4 categories

Diary

Water

Baby nutrition

Medical nutrition

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2004- sold Jacobi (European biscuits)business

2005-06- sold its sauces business

2007- sold LU and Prince brand to Kraftfor 5.3 billion

July 2007- purchased Numico the

Dutch baby food and nutrition companyfor 12.3b creating the worlds 2ndlargest manufacturer of baby food

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Segmentation and Innovation

New consumer benefit segment:mature category

Pioneering a new health segment

YOGURT

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For segmentation to be useful, youmust be able to act on it

Then you need to coordinate actionin the organization.

Marketing cant do it alone.

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Refrecne:

www.Google.com

Wekipedia.com

Philip kotler -principle of marketing.

Leon G. Shiffman- consumer behavior.
http://www.google.com/http://www.google.com/

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