Page 155 - Foundations of Marketing

122 Part 2 | Marketing Research and Target Markets

To select a segmentation variable, marketers consider several factors. The segmentation
variable should relate to customers’ needs for, uses of, or behavior toward the product. It
is likely a television marketer will segment television viewers for primetime television by
income and age but not by religion, for example, because people’s television viewing does
not vary much because of religion. Marketers must select measurable segmentation variables,
such as age, location, or gender, if individuals or organizations in a total market are to be clas-
sifi ed accurately.
There is no best way to segment markets, and the approach will vary depending on a num-
ber of factors. A company’s resources and capabilities affect the number and size of segment
variables used. The type of product and degree of variation in customers’ needs also dictate
the number and size of segments targeted. No matter what approach is used, choosing one or
more segmentation variables is a critical step in effectively targeting a market. Selecting an
inappropriate variable limits the chances of developing a successful marketing strategy. To
help you better understand potential segmentation variables, we next examine the differences
between the major variables used to segment consumer and business markets.

Variables for Segmenting Consumer Markets

A marketer that is using segmentation to reach a consumer market can choose one or several
variables. As Figure 5.3 shows, segmentation variables can be grouped into four major catego-
ries: demographic, geographic, psychographic, and behavioristic.

Demographic Variables

Demographers study aggregate population characteristics such as the distribution of age and
gender, fertility rates, migration patterns, and mortality rates. Demographic characteristics
that marketers commonly use include age, gender, race, ethnicity, income, education, occupa-
tion, family size, family life cycle, religion, and social class. Marketers segment markets by
demographic characteristics because they are often closely linked to customers’ needs and
purchasing behaviors and can be readily measured.

Figure 5.3 Segmentation Variables for Consumer Markets

Demographic variables Geographic variables
• Age • Occupation • Region • State size
• Gender • Family size • Urban, suburban, • Market density
• Race • Family life cycle rural • Climate
• Ethnicity • Religion • City size • Terrain
• Income • Social class • County size
• Education

Psychographic variables Behavioristic variables
• Personality attributes • Volume usage
• Motives • End use
• Lifestyles • Benefit expectations
• Brand loyalty
• Price sensitivity

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