let's recession of market segmentation so segmentation is when potential potential customers are divided into different groups or segments such as gender income the location or lifestyles now the key is is that you as a business would decide which of these particular groups is likely to be the most profitable for you or which has the most potential for long-term growth and then you would choose that particular one of those segments and you target that particular segment and then you'd position yourself accordingly in a particular market and you'd use the marketing mix that suits the particular segments
that you've chosen and you've chosen it because it offers growth or profit motives now let's look through each of these particular methods to segmentation or ways that you can segment a market we start with gender so gender you might offer author products based on gender it could be if you are a t-shirt business that you offer t-shirts and different shapes sizes or colors or if you're a moisturizer business then you might offer the same moisturizer but dependent on which gender you're targeting you might offer the packaging in different colors to segment the market now with
income you might offer or to products based on income it might be you offer particular packages but you offer a basic and a premium package because that will help target different income brackets if you're a car business you might offer a different range of cars to meet different income brackets needs if you segment by location it might be that you offer also products based on location it could be for example McDonald's but Donnell's in the Philippines they offer chips as we know it they often rice with their meals so they have looked at a particular
geography or location and they have tried to meet the customers needs in that particular way it could be with expansions as a business looking to expand off the coffee shops or food outlets it could be that they would look to decide which is the next town or city or geography that they expand to and they will do that based on which of the locations which of the segment's is likely to be the most profitable for them and then they would target that particular segment and then they would look to apply the appropriate marketing mix to
that particular segment based on the location in that case maybe they offer coupons or lots of promotion in that particular area that geography lifestyles you might offer awesome products based on lifestyle holiday providers are very common for this and that they will offer different holiday experiences based on a particular behavioral set based on a particular lifestyle it can be they offer all-inclusive holidays spa holidays family holidays nightlife holidays beach holiday sports holidays but they will be tailored to your particular lifestyle and it will help them to market more efficiently and more accurately now finally let's
look at the pros and the cons of market segmentation we'll start with the pros well you're able to meet customer needs better okay so if you can meet your customer needs better because you're offering even more tailored products to the particular customer rather than just offering one t-shirts everyone now you're offering their t-shirt to a particular size a particular shape and i'ma teach in a cup then you're definitely going to meet customer needs better this might lead to increased brand loyalty it might need to repeat customers it might reduce the price sensitivity of customers and
therefore you can increase your prices and look to increase your revenue as a consequence and it could be then it also leads to high profits but on the other side the cons of segmentation well it could lead to higher costs the reason why higher costs my car out is because you've got more research and development costs now that you're trying to make wider ranges this could lead to high production costs it could be new or more raw materials and components that are needed you might lead to additional marketing costs because you're trying to market to
different segments now and also because with my segmentation a business is often altering their product it might lead to a higher or wider product range and we've got a wider product range it means you're less able to exploit your economies of scale I hope that helps and I'll see you at the next [Music]
