LP3 – Marketing Segmentation

The three takeaways I had for marketing segmentation was demographics, psychographics, and segments.

Demographics

Marketing demographics is marketing segmentation of a target audience’s age, gender, sex, race, ethnicity, income, and education. Basically it’s a profiling of certain market.  Companies will use different marketing strategies to try and sell to different demographics.  They will also sell different versions of their products depending on their location. For instance, McDonalds would sell different versions of their burger in Asia compared to the American version that we are used to.

In this YouTube video, they talk about demographics and state the definition of it.  It discusses the topic that a company should know their target audience well.  Sometimes, companies will have their own way of getting demographic information from customers through surveys.  These surveys could entice consumers to purchase their products for a chance to win something in return for information.  Most customers don’t mind trading information in for a chance to win, wether it’s a big or small prize.

Psychographics

In this video, it talks about psychographics.  Psychographics is how a target market feels about a certain product or brand.  This video talks about three things, interests, activities and opinions.  He mentions selling products to hip hop music interested people.  They all share the same music tastes, style and opinions.  That market has a certain lifestyle and once a company can see a trend, they can use marketing strategies to capture their attention.  For instance, they can use popular music artists, certain colors, popular athletes, and hip hop songs.

Segmentation

http://www.investopedia.com/terms/m/marketsegmentation.asp

This link gives a good description of marketing segmentation.  A basic definition of segmentation is the separation of a target market into smaller groups to make it easier to target them.  The short video in the link gave three important factors.

1) Homogeneity (common needs within segment)

2) Distinction (unique from other groups)

3) Reaction (similar response to market)

Segmentation uses various breakdowns to capture their target audience.  The reaction deals more with psychographics.  Marketing strategies will vary depending on their target market. I thought that these three main points summed segmentation up clearly.  Once a company knows a common need, differentiates it from the entire market and creates a similar reaction, they have higher potential to increase their market sales.

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