Market Segmentation Basics

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Suppose a cosmetics company wants to segment the market for their skincare products. Here is how they might qualify market segmentation:

Measurable : The company collected data on the number of women aged 18-35 in various regions, their income, and their skincare preferences.
Accessible : The company ensures that they have good distribution in job function email database beauty stores and online, and have a strong digital marketing strategy to reach consumers in the segment.
Large Enough : The company found that the 18-35 year old women segment is large and profitable, with high demand for quality skin care products.
Differentiable : The company identified that women in this segment have specific needs, such as products that are free of harsh chemicals and environmentally friendly, that differ from the needs of other segments such as older women.
Feasible : The company has the resources and capabilities to develop products that suit the needs of this segment, set competitive prices, and run effective marketing campaigns through social media and influencers.
By meeting these market segmentation requirements, companies can ensure that they are targeting the right segments with the right strategies, thereby increasing the chances of success in marketing and selling their products.

Market segmentation bases refer to the criteria or factors used to divide a market into smaller, more homogeneous segments. Each of these segments has similar characteristics, needs, or behaviors, allowing companies to develop more focused and effective marketing strategies. Here are some commonly used market segmentation bases:

1. Demographics
Demographic segmentation uses characteristics such as age, gender, income, education, occupation, marital status, and family size. Demographics provide a clear picture of who the potential target market is based on their demographic attributes.

Example: A company might target skin care products to women aged 25-40 with middle to upper incomes.

2. Geographic
Geographic segmentation divides the market based on geographic locations such as countries, regions, cities, or areas. Geographic factors such as climate, culture, or infrastructure can influence consumer preferences and needs.

Example: A company may have a different marketing strategy for their product in the tropics compared to the subtropics.