Section 2.2 Market Segmentation Market

Transcript:Section 2.2 Market Segmentation Market:
Section 2.2 Market Segmentation Market Segmentation is a way of analyzing a market by specific characteristics in order to create a target market Market Segmentation Once a target market is clearly identified, a business can customize its product offerings and marketing strategies to that specific group of potential customers Businesses can segment a market by: Demographics Psychographics Geographics Product Benefits Sometimes all 4 methods are used Demographics Refers to the statistics that describe a population in terms of personal characteristics; they include: Age Income Gender Ethnic Background Education Occupation Once marketers know the demographics of a particular market they can categorize and develop their products to appeal to its members Age When marketers study age, they classify everyone according to certain generations Each generation tends to have common bonds because they have collectively shared experiences This makes it easier to target The last three markets are: Baby Boom(er) Generation Generation X Generation Y Baby Boomers 1946-1964 There are approximately 76 million baby boomers As of 1/1/2006, a boomer will hit the age of 60 every 7 seconds for the next 19 years! The number of Americans over 65 will double by 2030 Because of their large size and since their spending power increases as they get older, marketers spend a lot of attention to this group They control 2.6 trillion and have about 51% of the wealth in the United States They are prime targets for all types of luxury and recreational items They will remain a strong market for all kinds of products geared towards an aging population Generation X 1965-1976 There are around 40 Million in this age group Often products of duel career households or divorced parents Have been bombarded with media from an early age Tend to be savvy and skeptical consumers Better educated than any previous generation More financially cautious and conservative Prime consumers of cosmetics, fashion, movies and electronics Marketers use sharp images, humor and music to reach this group Generation Y – Millennials 1977- 2000 Around 77 Million of you! Most are children of Baby Boomers Growing up during a computer revolution, very comfortable using a computer and searching the internet Accustomed to doing more than one thing at a time Strive to be different than their parents Has 130 million in spending power and influences 250 billion in parent purchases; big ticket items like cars and computers Many buy their own shampoo