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CONSUMER BEHAVIOUR, FALL 2011
GROUP MEMBERS
ANNIE MOIN
AYAZ ALI SHAIKH
SAVEREENA SULEMAN
TEACHERMISS ALIA HASAN
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MARKET SEGMENTATION
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BECAUSE.
Businesses involve much more than selling products/services and advertise it.
Complex markets consisting customers/consumers each with different ideas,perceptions, buying behaviors, race, religion, age and income etc
Allow marketers of consumer goods and services identify the needs of the market.
Defined segments help the organization in devising marketing strategy,Advertisement, Promotions etc
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Customer segmentation process
Understandthe consumer
need.
Groupcustomers byneed groups.
Identify themost
attractivesegments.
Developunique valuepropositionsby segment.
Developunique Go-To-Market
strategies bysegment.
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BASIS OF SEGMENTATION
Geographic Segmentation
Demographic Segmentation
Psychological Segmentation
Psychographic
Socio-cultural Segmentation
Use-Related Segmentation
Use Situation Segmentation
Benefit Segmentation
Hybrid Segmentation
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Geographic Segmentation
Its market division by location.
People living in the same area share some similar needs and wants.
Consumers needs and wants differ on regional basis(Culture, religion, climate etc)
consumers in different areas may display certain characteristics and behaviorsin that particular region which people in other regions might do not have.
Companies selling products/services would like to know, where their productsare being sold.
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DEMOGRAPHIC SEGMENTATION
Peoples wants and demands vary with respect to different age levels
Gendersegmentation is commonly used within the cosmetics,clothing and magazine industry.
People with different income levels have different buyingbehaviors.
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IS IT THE RIGHT SEGMENT FOR COLGATE??
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PSYCHOLOGICAL SEGMENTATION&
PSYCHOGRAPHIC Marketers divide the total potential market into smaller subgroups on the basisof intrinsic characteristics of the individual, such as personality, lifestyle, attitudes orinterests.
Psychographic is aimed at describing the accurate profile of required segment.
Here markets are divided on the basis of the psychology and lifestyle habits ofcustomers.
marketing a product requires a deep understanding of the customerspsychology, along with their needs, in order for the product to be accepted.
Psychographic Segmentation Variables, Interests, Activities, Opinions,Behavioral patterns, Habits, Lifestyle, Perception of selling company, Hobbies
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Socio-cultural segmentation
Social Class
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Culture &Subculture
Culture: Cultural tend to share same
values, beliefs and customs
Sub culture: Subgroup are often united by
certain experiences, values orbeliefs
Global marketsegmentation:
Same type of productregardless of which nation
they belong. Due to true globalmarket place people living inone country or region used
the product manufactured inother country.Sou
rce:consumerbehavior
-L.Schiffman&L.kanuk
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RELIGION
Influencing the buying pattern or preference
of consumer in purchase decision. Eid, Diwali, Christmas and religious festival
occasion.
Sourc
e:consumerbehavior-L
.Schiffman&L.kanuk
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FAMILY LIFE CYCLE
A composite variable reflects relative age,
income, and employment status.
Representing an important target segment
E.g.: Bank al Habib, insurance company.
Key consumer related roles - information
gather, influencer, user, decider,
maintainers and disposers.
Roles often are influenced by familys
lifestyle and cultural factors.
Sourc
e:consumerbehavior-L
.Schiffman&L.kanuk
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SOCIAL CLASS: Combination factors are occupation, income,
education, wealth.
Three methods of measurement
1. subjective measure-individual self-
perception,2. reputational measure-individual perception
for other
3. objective measure use specific socio-economicmeasure (single variable index or composite
variable index).
MCB service to B2B, B2C
Southwest Air Line, B2B, B2CSourc
e:consumerbehavior-L
.Schiffman&L.kanuk
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Rate of usage segmentation:
Finds out consumer behavior anddifferentiate among heavy user,medium user, light user and non
user of product and services.
Tooth brush and mobile package.
Awareness status: Consumer rate of awareness, level
of interest in the product andwillingness to buy the product.
Nesvita milk
Use-Related segmentation
Source:consumerb
ehavior-L.Schiffman&L
.kanuk
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Use-Situation Segmentation
On the basis of occasion or situation
marketers determine what consumers will
purchase or consume.
Sourc
e:consumerbehavior-L
.Schiffman&L.kanuk
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Benefit Segmentation
Product or service benefits
Changing life style directed to benefits
Used for positioning of various brandwith in the same category.
Sourc
e:consumerbehavior-L
.Schiffman&L.kanuk
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Hybrid Segmentation
Combining several segmentation
Three hybrid segmentation approaches.
Psychographic-Demographic.
Geo-Demographic.Value and lifestyle system.
In Psychographic-Demographic-used in
development of advertisement.
Geo-Demographic-people who lives close to one
another are likely to have similar economic status,
taste ,preferences, lifestyle and consumption habits.
Sourc
e:consumerbehavior-L
.Schiffman&L.kanuk,w
ww.googel.com,www.w
ekipedia.com
http://www.googel.com/http://www.googel.com/http://www.googel.com/http://www.googel.com/http://www.googel.com/http://www.googel.com/http://www.googel.com/http://www.googel.com/http://www.googel.com/http://www.googel.com/http://www.googel.com/http://www.googel.com/http://www.googel.com/http://www.googel.com/http://www.googel.com/8/2/2019 cb-seg (1)
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Value and life style system
Explains the various attitudes towards societyand institutions.
Applies psychographics to businessmanagement.
Away of thinking of consumers beyonddemographics.
Focuses more explicitly on explainingconsumer purchase behavior.
Sou
rce:consumerbehavior-L.Schiffman&L.kanuk,
principleofmarketing
P.Kottler
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Framework An individuals primary
motivations as well as his
resources determines how a person
will express himself/herself in the
market place.
Three primary motivation include :
Principle Oriented (Ideal)
Status Oriented (Achievement)
Action Oriented (Self- expression )
The consumer with in each
orientation further classified into
those with high level of resourcesand low level of resources depends
on income, education, health, self-
confidence, energy and willingness
to buy.
Sou
rce:consumerbehavior-L.Schiffman&L.kanuk
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Finer segmentation
The strategies we use in finer segmentation are:
-micro-segmentation
-mass-segmentation
-verity-seeking strategy.
The bases we used in developing finer segments:
-customized offering
-diverse customer base
-close customer relationships.
StrategicMarketin
g&planning
THE IBM STORY
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32
THE IBM STORY
Sluggish sales in 90s
Segmented on geographic divisions and product-
groups.
Segmentation as an active strategy- in 1991
New segments based on customer needs
1. Insurance Cos.
2. Banks
3. Govt Depts.
4. Retail5. Industry
Regained profitability in 1994.
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IDENTIFIABLE
FAVORABLECOST/
BENEFIT
STABILITYOVERTIME
ACTIONABLE
Criteria forEffective
segmentation
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Identifying segments
Identifying- differentiating the segment
Based on consumer needs
Example anti wrinkle/aging creams
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Actionable/Accessiblesegments
Actionable- resources to reach thesegment/ accessibility
Telenor Easy Paisa:
Transferring of remittances
Bill payment
Easy pay- corporate collection fromcustomers
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Stability over time
Likely to grow larger over time
Rooh Afza in Ramazan
Targeting teens- stable like cosmetics
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Favorable cost/benefit
Sufficiency- segments size justifyingcost and benefit
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The best example
In Pakistan , Tea- oriented people
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French company
Global market share of 27%
Present in 72 countries
Mission: to bring health through food andbeverages
In 1999, focused on 3 categories
BiscuitsWater
Diary
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1999 and 2003- sold its glass containerbusiness
2000- sold beer brand Kronenbourg1964
2002- sold Italian cheese and meatbusiness
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In 2003 refocused on 4 categories
Diary
Water
Baby nutrition
Medical nutrition
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2004- sold Jacobi (European biscuits)business
2005-06- sold its sauces business
2007- sold LU and Prince brand to Kraftfor 5.3 billion
July 2007- purchased Numico the
Dutch baby food and nutrition companyfor 12.3b creating the worlds 2ndlargest manufacturer of baby food
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Segmentation and Innovation
New consumer benefit segment:mature category
Pioneering a new health segment
YOGURT
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For segmentation to be useful, youmust be able to act on it
Then you need to coordinate actionin the organization.
Marketing cant do it alone.
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Refrecne:
www.Google.com
Wekipedia.com
Philip kotler -principle of marketing.
Leon G. Shiffman- consumer behavior.
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