Business Studies – 3.1.4 Market segmentation | e-Consult

Demographic Segmentation: This involves dividing the market based on easily measurable characteristics such as age, gender, income, education, occupation, and family size.

• Example: A luxury car manufacturer might target high-income individuals aged 45-60 with a focus on status and performance.

• Example: A toy company might target families with young children (age 2-8) with a range of age-appropriate toys.

Psychographic Segmentation: This focuses on lifestyle, values, attitudes, interests, and personality traits. It's more difficult to measure than demographic data but provides deeper insights into consumer motivations.

• Example: An outdoor clothing company might target individuals who value adventure, sustainability, and healthy lifestyles.

• Example: A coffee shop might target students and young professionals who value social interaction, creativity, and a relaxed atmosphere.

Behavioural Segmentation: This divides the market based on consumer behaviour, such as purchase history, brand loyalty, usage rate, and benefits sought.

• Example: An airline might offer frequent flyer programs to reward loyal customers and encourage repeat business.

• Example: A supermarket might offer discounts on products that are frequently purchased by a particular group of customers.

By combining these three types of segmentation, a company can create a more detailed and accurate profile of its target customers.