Market Segmentation Concept In Marketing

Question 1

Market segmentation is a process to divide the market of potential consumers into different segments by looking at their common needs and wants or by their demand characteristics. It is a fundamental step for marketing managers to employ so as to identify and focus on their consumers buying behaviour and pattern (Martin 2011). By identifying the target market, it allows them to focus their marketing effort on their target market.

Under B2C market segmentation concept, it consist of four types of variables. These four types are Demographic variables, Psychographic variables, Geographical variables and Behavioural variables.

Demographic variables are divided based on variables like gender, income, age, household life cycle, occupation

It helps marketing managers to understand why consumers made that buying decision through their behaviour. One of the psychographic segmentation method is values, attitude and lifestyle system as known as VALS. Stanford Research Institute has developed VALS 2 which concentrate more on the psychological framework and it is segmented into two variables which consist of self orientation and resources (Gao et al.2009). Within these two variables, VALS 2 illustrate into eight lifestyle groups that display distinctive behaviour and buying decision. These eight lifestyle groups are actualisers, achievers, believers, experiencers, fulfillers, makers, strivers and strugglers.

• Actualisers are consumers who have high income, high self-esteem and self image is important.

• Achievers are consumers who are motivated in the career they achieved. They purchase products or services for recognition of their success.

• Believers are consumers who have modest income and choices are influenced by family, religion or social

Self orientation is the dimension to determine on how an individual pursue the types of intention and behaviour to acquire the products or services that are able to provide satisfaction and sustain or adjust their social self image. Under self orientation, there are three types of elements such as principle oriented, status oriented and action oriented individuals.

Principle oriented are consumers who purchase products or services based on their belief and principle. They do not care about how others think of them. Whereas for status oriented consumers, they have high self esteem and purchase products or services to show off their success. Lastly, action oriented consumers seek for adventures and follow fads. They are influenced by the needs of social and physical activity.

Under this concept, it is understand that every individual purchase products and services based on their lifestyle. Consumers under the same demographic sub-group can demonstrate different psychographic profile (Lin 2002). Thus, self orientation is a important concept for Kill_Kapture to analyse as they market their products under niche market. This concept helps Kill_Kapture to understand the behaviour and buying decision of their target market. With these understanding, Kill_Kapture will be able to focus their marketing effort on the correct segment in a cost effective