Question

Discuss three dimensions for segmenting markets and illustrate your response with an example.

Answer 1

Three dimensions of segmenting markets are

1) Demography

2) Geography

3) behavioral

1) Demography: the demographical dimension of segmenting market focusses on the demography which is the composition of a particular human population like age, gender, income This is one of the main dimension of segmenting markets . Most of the firms use this as the dimension to differentiate among consumers. Eg: smartphones : the segmentation would be done on the basis of age . Younger population tends to have the latest smartphones than the older ones who prefer the basic features cell phones.

Another example could be of apartments : most of the younger population would have a higher demand for large apartments with latest technologies and other inbuilt features like passcodes and higher level safety equipment while the older population would prefer it at places with less noise and peaceful surroundings and a smaller apartment relatively.

2) Geography:

This dimension is based on the geographical aspect ie segmentation is based on geography . This could be based on divisions like urban ,rural : colder and hotter areas etc .

Example : Population living in hotter areas or near the equator would prefer more Air Conditioner than those living near the poles. Similarly, the demand for woolens would be higher in the colder areas and that of cotton clothes and fabric be higher in hotter areas, This helps the companies in differentiating the market .

3) behavioral: the last is the segmentation done on the basis of the behavioral dimension. As the name suggests, this is about the behavior of the consumers ie how consumers react in certain changes in the product or any other aspect which influences their buying of goods.

eg : people tend to buy more during festivals like Christmas and Thanksgiving than at any other day .

Another example could be more is bought at shops which offer discounts than the ones without it because a consumer would prefer buying the same good at a lower price .

(you can comment for doubts )