Market Segmentation Examples
In this article I am going to take a quick look at some market segmentation examples.
Market segmentation refers to the process of identifying specific groups within a market, which share certain characteristics and certain needs or buying patterns. For example, segmentation may be done by geographic location, by gender, by income level, by social class, by activity, by education level, by age, and so on. The possibilities are more or less endless. Of course, it only makes sense to talk about a market segment when it enables a firm to better market its product/service to them: so, gender may be a segmentation factor when dealing with toys, but it probably makes little sense to talk of gender when one is selling table sugar.
Companies can then choose to target individual segments with specific products, multiple segments with single products, individual segments with multiple products (often this would be niche marketing), or mass market its product to everyone. Companies that employ modular product design can target multiple segments with substantially different needs using products that are essentially almost identical.
Below I will outline three examples of market segmentation.
Market segmentation: Example 1, the lady shaver
This is a product that segments by gender and targets women. The product will focus on both design and functionality to match its target segment. As always, segmentation is carried out on the basis of thorough data gathering and analysis. This is not to say that such a product needs to be exceptionally different. Sometimes the appearance, color, and so on may be enough.
Market segmentation: Example 2, air travellers
These could be anything from customized headsets to carry-on luggage. The common theme here is that they target a segment based on an activity. By identifying specific needs in this segment, or by creating a product that makes life easier (thereby generating demand when there was no specific “need”), the company aims to better serve its segment than its more generalized competitors.
Market segmentation: Example 3, beer
This is one of my favourite examples, because it never ceases to amaze me in how many different ways beer can brand itself without ever changing the product one iota. Where I live, I have seen in my lifetime one of the most popular brands of beer redefine itself from the “working class beer” to “the upscale beer”. Same product, different marketing. I have also seen a beer that is considered the commoners’ beer in one country marketed as an upscale beer in another country.
These examples show segmentation done by gender (or more specifically by the common psychological needs of a certain type of male) and by location. I could list several other examples for beer, but I think we got the idea.
Market segmentation: Example 4, http://www.legoland.com
This time I chose a website because I wanted to highlight something from web-based marketing. Market segmentation is at the core of the field of internet marketing known as conversion optimisation. Conversion optimisation refers to the art of tailoring a website to meet the needs of specific customer segments and thus increase visitor to customer conversion rates (you can read more about conversion optimisation here). Top websites do this all the time – they align their site’s presentation, design, content (or lack thereof), and message to target specific segments of the population. Check out legoland’s website for an excellent example of market segmentation for families and kids.
This concludes my brief article on market segmentation examples. Hopefully it was enough to give a rough idea of how diverse segmentation can actually be.