Consumer Behaviour Notes

• Explain demographics, Geographic’s, psychographics and why companies use these methods to segment the market effectively

(1)Geographic segmentation is based on geographic location, such as region, state, or city. (2)Demographic segmentation are statistics that describe the population such as age, gender, race, ethnicity, income, education, occupation, social class, life cycle state, and house hold size. (3)Psychographic segmentation are linked closely with demographic includes lifestyles, values, attitudes, interests, and opinions. (4)Behavioral segmentation used to identify clusters of consumers who seek the same product benefits or who use or consume the product in similar fashion (Lascu & Clow, 2012).

The market is divided into different segments based on the variables of family size, family life cycle, income, gender, age, religion, generation, occupation, social class and nationality.

When it comes to marketing strategies, most people spontaneously think about the 4P (Product, Price, Place, Promotion) – maybe extended by three more Ps for marketing services (People, Processes, Physical Evidence).

Market segmentation is a marketing concept that divides a large heterogeneous market into smaller homogeneous subsets of consumers with similar needs, wants and characteristics. Researchers might be able to predict customer 's behavior by studying if there are any relations between customer 's personality and the product selection process. A key success for any business is to communicate with its customers better than competitors by understanding who its customers are and what they want. The more specific costumers are segmented, the easier a business will understand its customers and build successful relationship with them because customers usually choose a product that expresses their personality. The market can be segmented by different types of segmentations such as demographic, geographic and psychographic. Marks & Spencer uses demographic segmentation to target customers above the age of 30 with high income and executive occupation. It also segments the market through value, as many products in M&S’s clothing range have a premium-priced segment, a mid-priced segment and a lower price segment.

Market segmentation is the process of dividing the market into various segments which maybe on the basis of demographics, psychographics, behavioural or geographic factors (Philip Kotler, 2012). For instance, Britvic may break down its market into groups based on age such as children (those who are under 18) and older consumers (those who are over 50). People in one segment share similar characteristics, attitudes. In this example, the ones in the children segment may prefer flavours like strawberry, may like nice, attractive packaging than other segments like older consumers.

Demographic segmentation – Demographic segmentation is one of the straightforward and most conventional type of market segmentation used. Segmentation usually divides people based on variables. Thus demographic segmentation has its own variables such as age, gender, family size, income, occupation, religion, race and nationality. Demographic segmentation can be applied to any types of businesses. Subway has various types of sandwiches with different price scales in which fits end users choices. This is individually done on the base of incomes which is a percentage of

18. Positioning plays a pivotal role in marketing strategy, because it links market analysis and competitive analysis to environmental analysis.

As people age their needs and wants change, some organizations develop specific products aimed at particular age groups. Gender segmentation is commonly used within the cosmetics, clothing and magazine industry. Income segmentation is another strategy used by many organizations Products and services are also aimed at different lifecycle segments.

Positioning is the aspect of the product or brand actively communicated to the target audience, specifically, its competitive advantage, values and imagery. It is strongly related to the perception and image of the product. When devising a positioning strategy for a product, marketers must establish a unique and distinctive image of that product in the mind

Demographic – This is the most common method of dividing the market and is segmentation based on general population characteristics.

Market segmentation is dividing a market into direct groups of consumers who might separate products requirements or marketing mixes, the process of classifying customers into groups with different need and requirement. (Kotler et al 2010, p.264). In this proposal, the market segmentation will be discussed from three aspects, which are demographic, behaviours and psychographic.

Adapted from Thomas V. Bonoma and Benson P. Shapiro, Segmenting the Industrial Market (Lexington, MA: Lexington Books, 1983).

Consumer Behavior, why not Customer Behavior? V1.0 © NCC Education Limited Consumer Behavior The behavior that consumers display in (1) searching for, (2) purchasing, (3) using, (4) evaluating, and (5) disposing of products and services that they expect will satisfy their needs. The Female Brain $-€-£ Harvard University’s N E F- C . .

The term consumer behavior is defined as the behavior that consumers display in searching for purchasing, using, evaluating & disposing of products & services that they expect will satisfy their needs. Consumer behavior focuses on how individuals make decisions to spend their available resources (time, money, effort) on consumption related items. That includes what they buy, why they buy it, when they buy it, where they buy it, how often they buy it, how often they use it, how they evaluate it after the purchase and impact of such evaluation on future purchases & disposal.