Question

Q1. Describe the variables (demographic, psychographic, and behavioral) used to segment Amazon's target markets. Explain how Amazon evaluates the attractiveness of each identified market segment?

Answer 1

The variables (demographic, psychographic, and behavioral) used to segment Amazon's target markets

We can segment business markets with some of the variables such as geography,benefits sought,and usage rate,but business marketers also use other variables.

The demographic variables are the most important.It involves income,age,gender,family size,marital status,occupation ,religion,education etc.

The psychographic segmentation is how marketers learn to position their products so that compatible customers can discover them.It involves lifestyle,social status, personality traits,values and attitudes, activities and interest etc. of the customer.

The behavioural segmentation divides people into different groups who have a specific behavioural pattern in common. It involves usage frequency,brand loyalty,benefits needed,occasion ,buyer readiness stage etc.

Geographic segmentation of Amazon

· Amazon covers more than 100 countries, urban and rural

Psychographic segmentation of Amazon

· Social class: working, middle, upper.

· Lifestyle: resigned, mainstreamer, explorer, struggler, aspirer, reformer.

The Amazon company evaluate the attractiveness of each segment using the following criteria:

• Amazon uses demographic and psychographic segmentation to segment their markets. Their segmentation is based on purchasing behavior of customers.Their aim is to convert customers into long term and also high value customers.
• As an e-commerce company they targets the middle class and upper class people who are aware of technology. More than 50% of the consumers are the repeat buyers at Amazon.com.
• The main advantage they provide for their customer is that one can buy anything and get it delivered at any location, whether urban or rural