Segmentation Marketing

Lately it seems a growing number of clients have been talking about switching to a ‘segmentation’ based marketing model. The simplest way that I can explain this concept is with an example.

JACK FM has an average weekly audience of 346,000 Adults listening over the age of 12. This know as our CUME or put another way, JACK’s market. However, as a marketer, I’d like to break down our audience into the groups of people who are most important to my business. These groups, or segments, have similar needs and can be identified by on

1. Demographics (age, family size, life cycle, occupation),
2. Geography (states, regions, countries),
3. Behavior (product knowledge, usage, attitudes, responses) and/or
4. Psychographic (lifestyle, values, personality).

Each segment has unique set of needs from each other and each should be marketed to differently. If JACK FM was trying to sell a product or service, I would determine which segments are most profitable, choose a only a few that I want to attract as customers, then develop a marketing strategy to communicate with that particular segment.

Below is a very short list of some segments within our audience. This data is sourced from BBM-RTS Calgary Fall ‘09 Base: P12+, Tune into JACK FM. If you’d like me to get some research done on your preferred segment, please feel free to call or email me at 403-686-9715 or

Demographics – age, family size, occupation

Child born/ adopted: 14,933 listeners
Between 35-54: 117,640 listeners
Employed as Owners,Managers or Professionals: 114,180 listeners

Behaviour – product knowledge, usage & attitudes

Dine at casual/ family dining restaurants 1+ times/ month: 25% more likely than the average Calgarian (24,789 listeners)

Visited a national/ provincial park 7+ times/ year: 21% more likely than the average Calgarian (13,727 listeners)

likely to buy/ lease a vehicle in the next 12 months: 17% more likely than the average Calgarian (35,996 listeners)

Psychographic – lifestyle & values

Spent $3,000+ on last vacation: 28,015 listeners
Occasionally/ regularly cycle (mountain/ road biking): 84,055 listeners
Occasionally/ regularly golf: 75,547 listeners

A market segment is a sub-set of a market made up of people or organizations sharing one or more characteristics that cause them to demand similar product and/or services based on qualities of those products such as price or function.

The process of segmentation is distinct from targeting (choosing which segments to address) and positioning (designing an appropriate marketing mix for each segment). The overall intent is to identify groups of similar customers and potential customers; to prioritize the groups to address; to understand their behavior; and to respond with appropriate marketing strategies that satisfy the different preferences of each chosen segment. Revenues are thus improved.

Market segmentation is the act of identifying and profiling distinct groups of buyers who might require separate products and/or marketing mixes
It is the process of splitting customers into different groups or segments, within which customers with similar characteristics have similar needs. Benefits: 1) marketers are in a better position to locate and compare marketing opportunities 2) marketers can easily and effectively formulate and implement marketing programs 3) marketers can make finer adjustments in their products and marketing communications. 4) Competitive strengths and weaknesses can be assessed effectively 5) Segmentation leads to more effective utilisation of marketing resources
Once a market segment has been identified (via segmentation), and targeted (in which the viability of servicing the market intended), the segment is then subject to positioning. Positioning involves ascertaining how a product or a company is perceived in the minds of consumers.This part of the segmentation process consists of drawing up a perceptual map, which highlights rival goods within one’s industry according to perceived quality and price. After the perceptual map has been devised, a firm would consider the marketing communications mix best suited to the product in question.

Segmentation is essentially the identification of subsets of buyers within a market that share similar needs and demonstrate similar buyer behavior. The world is made up of billions of buyers with their own sets of needs and behavior. Segmentation aims to match groups of purchasers with the same set of needs and buyer behavior. Such a group is known as a ‘segment’. Think of your market as an orange, with a series of connected but distinctive segments, each with their own profile.

A business must analyze the needs and wants of different market segments before determining their own niche. To be effective in market segmentation keep the following things in mind:
1. Segments or target markets should be accessible to the business
2. Each segmented group must be large enough to provide a solid customer base.
3. Each segmented group requires a separate marketing plan.

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