Businesses cannot serve everyone in the same way. Customers differ by age, income, education, occupation, family size and location. Demographic segmentation divides the market into meaningful groups using these variables. Then firms select the best group(s) (targeting) and create a clear place in the customer’s mind (positioning). This topic explains demographic segmentation, STP, and how demography shapes consumer behavior and marketing decisions.
Market segmentation is the process of dividing a broad market into smaller groups of customers with similar needs, characteristics or behavior.
Demographic segmentation means dividing the market based on demographic variables such as age, gender, income, education, occupation, family size and region.
Why it is popular:
Targeting means selecting one or more segments that the firm will serve.
Approaches (basic):
Positioning means creating a clear, distinctive and desirable image of the product/brand in the mind of the target customer.
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Demographic bases for segmentation include:
(Any three bases like occupation, family size and region can be written.)
Approaches of targeting include:
(Any three approaches can be written.)
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Businesses cannot serve everyone in the same way. Customers differ by age, income, education, occupation, family size and location. Demographic segmentation divides the market into meaningful groups using these variables. Then firms select the best group(s) (targeting) and create a clear place in the customer’s mind (positioning). This topic explains demographic segmentation, STP, and how demography shapes consumer behavior and marketing decisions.
Market segmentation is the process of dividing a broad market into smaller groups of customers with similar needs, characteristics or behavior.
Demographic segmentation means dividing the market based on demographic variables such as age, gender, income, education, occupation, family size and region.
Why it is popular:
Targeting means selecting one or more segments that the firm will serve.
Approaches (basic):
Positioning means creating a clear, distinctive and desirable image of the product/brand in the mind of the target customer.
Positioning often uses:
Demographics influence:
STP helps firms allocate limited resources to the most profitable segments and communicate clearly, improving competitiveness and customer satisfaction.
Demographics describe who customers are; psychographics describe what they believe and value. Good marketing often uses both.
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STP is a marketing framework used to match a product with the right customers and create a clear brand image. It includes Segmentation, Targeting and Positioning.
First, segmentation means dividing the market into groups based on similarities. For example, a smartphone company can segment by age (students, young professionals, seniors), income (budget, mid, premium) and region (urban, semi-urban).
Second, targeting means selecting the best segment(s) to serve based on profitability, size and company capability. The company may choose “young professionals with mid-to-high income in urban areas” as the target segment.
Third, positioning means creating a distinct place in the customer’s mind. The phone may be positioned as “fast, stylish and value for money for working professionals.”