Customer Segmentation

& Positioning
Effective Methods of Segmenting
& Targeting the Potential Customers
Why Segmentation?
 Customer Segmentation –
 A firm can NOT satisfy every need of every customer in market

 It is not practical and viable to target all the customers al the time

 Identify set of customers, who when targeted would be most profitable

vis-à-vis Marketing costs.

©2019, BrandPrism Consulting LLP

Customer Segmentation
 Customer Segmentation –
 Technique by which customers are aggregated into groups, such that –
 Customers are homogeneous within the group
 but, heterogeneous across different groups

 Different segments have –

 Different needs and expectations,
 May require different versions of same product (different price, different
places, different media)

©2019, BrandPrism Consulting LLP

Customer Segmentation Process

 4-step Customer segmentation process –

1) Identify basis for segmenting the market

2) Define customer segments and profile for each

3) Select Target segment

4) Develop marketing strategies for target segment

©2019, BrandPrism Consulting LLP

Customer Segmentation
 Different bases for segmentation -
A. Geographic

B. Demographic

C. Behavior based

D. Psychographic

©2019, BrandPrism Consulting LLP

Geographic Segmentation
 Use Geography (spatial variables) to divide market

 Example, Indian market, North Market, South Indian Market

 Example….?

©2019, BrandPrism Consulting LLP

Demographic Segmentation
 Use characteristics of population like
• Age, gender
• Education,
• Marital status,
• Household type
• Income level
• Social class (High/Mid/Low, etc.)

 Example, lifestyle product companies, consumer goods companies,

etc.
©2019, BrandPrism Consulting LLP
Psychographic segmentation
 Attitudes, values and interests that shape a consumer lifestyle

 Example,
 Health conscious consumers
 Time pressed consumers
 Environmentally conscious consumers

Examples …. ?

©2019, BrandPrism Consulting LLP

Behavior based segmentation
 Based on knowledge, usage, attitude, towards a product

 Variables for behavior based segmentation

 Occasion – Traveling in breaks/holiday season, weddings, etc.
 Benefits – For family/for self/social animal, etc.
 User status – Beginner/Expert/Intermediate
 Usage pattern – Heavy user/Medium/Light user
 Loyalty – Brand Loyal/Admirer/Value Seeker/Switcher, etc.

Examples …. ?
©2019, BrandPrism Consulting LLP
Compare Different Segments
Generation Traits Characteristics Examples
Traditionalists Patriotic, loyal, faith in Brand loyal, expect value for TITAN watches, Bajaj
institutions money Scooter, Tata salt, etc.

Baby Boomers Idealistic, competitive, question Value status, willing to try new Fogg Deodorants,
authority brands, limited time iPhones, LG washing
machines, Sony TVs
Generation X Eclectic, self-reliant, skeptical, Value individuality: need Facebook, Gmail, BMS,
highly adaptive to change and respect and safety and value PVR cinemas, etc.
technology those who can provide it
Millenials Global, cyber literate, media Savvy consumers, value Tinder, Snapchat,
savvy, environmentally opinions of peers, loyal to Learning apps, Netflix
conscious their brands

(*Source: U.S. Census Bureau, American Fact Finder: Age Groups and Sex 2010 & BridgeWorks, 2000)

©2019, BrandPrism Consulting LLP

Target Market
 A single firm can NOT satisfy every customer need, hence, it identifies
those segments it can satisfy in profitable way.

 TG – part of the “available market” a firm decides to pursue

• Example,
Clinic Plus – Basic hair care, mass production, price sensitive – Lower Income class
Sunsilk – Shiny hair, everyday use, value for money - Middle class
Pantene – Attribute, dandruff control, silky hair, god looking hair - Higher middle
class
Tresseme – Professional hair, party look, trend setter – Higher Income class

©2019, BrandPrism Consulting LLP

Positioning

• Designing a company’s offerings and image to occupy a distinctive

place in the minds of the target segment.

• Brand Positioning – “How customers perceive you”.

• Ex.,
TATA Motors , Coca Cola, Reliance Jio, Infosys, Paytm, Samsung, Xiaomi

©2019, BrandPrism Consulting LLP

Positioning

©2019, BrandPrism Consulting LLP

For Management Consulting/Strategic Advisory

• Vishal R Kahate
Managing Partner, BrandPrism® Consulting LLP
PGDM - IIM, Calcutta (2014-16)
Phone : +91-9769560216
• Email: vishal.kahate@brandprism.in

• URL: www.brandprism.in

©2019, BrandPrism Consulting LLP

THANK YOU!

©2019, BrandPrism
©BrandPrism
Consulting LLP