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7 Customer-Driven Marketing Strategy: Creating Value for Target Customers Chapter Concepts: Market Segmentation Market Targeting Differentiation and Positioning Market Segmentation Market Segmentation Market segmentation is the process that companies use to divide large heterogeneous markets into small markets that can be reached more efficiently and effectively with products and services that match their unique needs Market Segmentation Segmenting Consumer Markets Geographic segmentation Demographic segmentation Psychographic segmentation Behavioral segmentation Table 7.1 Major Segmentation Variables for Consumer Markets Market Segmentation Segmenting Consumer Markets Geographic segmentation divides the market into different geographical units such as nations, regions, states, counties, or cities Market Segmentation Segmenting Consumer Markets Demographic segmentation divides the market into groups based on variables such as age, gender, family size, family life cycle, income, occupation, education, religion, race, generation, and nationality Market Segmentation Segmenting Consumer Markets Demographic segmentation is the most popular segmentation method because consumer needs, wants, and usage often vary closely with demographic variables and are easier to measure than other types of variables Market Segmentation Psychographic segmentation divides buyers into different groups based on social class, lifestyle, or personality traits Segmenting Consumer Markets Market Segmentation Segmenting Consumer Markets Behavioral segmentation divides buyers into groups based on their knowledge, attitudes, uses, or responses to a product Occasions Benefits sought User status Usage rate Loyalty status Market Segmentation Requirements for Effective Segmentation To be useful, market segments must be: Measurable Accessible Substantial Differentiable Actionable Market Targeting Evaluating Market Segments Target market con
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