Question

Kathmandu is a leading retailer of clothing and equipment for travel and adventure in New Zealand and Australia.
This question asks you to segment Kathmandu’s market in Australia. The major segmentation bases are geographic, demographic, psychographic, and behavioral segmentation.

(1) Select one appropriate variable in each of the four bases (i.e., four variables in total) and explain why each variable is useful for Kathmandu's segmentation.

(2) According to the four variables you select for (1) Choose a target segment in Australia for Kathmandu. You can use one variable or combine some variables to determine the target segment. Analyze this target segment by applying the five effective segmentation criteria (Measurable, Substantial, Accessible, Differentiable, and Actionable).

Answer 1

There are two different questions. I am giving you the answer to the first question:

1. Answer.

Geographic segmentation: Geographic segmentation is done based on variables like city, country, or region. In the case of Kathmandu, we will select the city or places which are tourist destinations and also host adventure sports.

Demographic segmentation: Demographic segmentation is used to divide the market on the basis of demographic variables like age, gender, ethnicity, etc. we will select Age variable for Kathmandu as the product is mainly used by people of certain age groups.

Psychographic segmentation: Psychographic segmentation is a technique to segment the market in different segments based on psychographic variables like values, interest, or attitude. For Kathmandu, we will select the interest as a variable under psychographic segmentation. Because the interest in travel and adventure sports is a must in the segment for Kathmandu products.

Behavioral segmentation: This technique of market segmentation is based on behavioral variables like purchase behavior. brand loyalty, usage pattern, benefits sought, etc. For Kathmandu, we will select benefits sought as a variable under behavioral segmentation. Benefits sought from travel and adventure products will be considered as segmentation variables for Kathmandu's product because there is certain type of expectation customer has from travel and adventure products.