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The «Do It Yourselfer» (25%)

— Great pride in good pictures

— Gratification from making settings and adjustments

— Pride in a complex camera

— Regards a good picture the result of his expertise

The Black Box User (40%)- Taking pictures considered a necessary evil- Little pride expressed if the picture is good- Desire for camera to be as simple as possible

The Timid Photographer (35%)

— Great pride in good pictures

— High perceived risk that pictures will not be good

— No confidence in ability to manipulate camera and settings

— Desires camera to guarantee good picture without effort

It is clear that quite different marketing strategies would be appropriate in these three segments. Different product variants and different promotional treatments would be warranted. There may also be the need to consider alternative distribution channels for each segment. The «black box user» may be better reached in chain stores such as Boots; the «timid photographer» may use more specialist chain stores such as Dixons, and the «do it yourselfer» could be more attracted to smaller photographic shops.

Reekie, in his book «Advertising and Price», provides another useful illustration of benefit segmentation, as applied to Cadbury/Schweppes’ dried milk powder sold under the brand name Marvel. This formulation was devised to offer the following benefits; —

A standby for the housewife if she runs out of milk.

For those needing for health reasons a fat free diet.

For slimmers and weight watchers.

For single person homes, and elderly people who might find it convenient because they would not consume a whole pint.

Demographic and perhaps attitudinal descriptions of these groups could lead to distinctive advertising appeals, using different media in each case. The choice of medium would depend upon determining the media exposure profile for each segment.

An extension of this analysis is provided by Myers. He suggests attempting to gauge the benefits wanted by consumers, and to compare these to the benefits they perceive to have been received. Any resulting deficiency might offer a guide for product development or the introduction of a new product

Usage Segments; — For most markets, usage is not spread evenly across all consumers:- the distribution is skewed. Analyses of volume of usage by several categories are commonly employed, and market research studies often report on heavy, moderate, light and non users. Heavy users of some consumer goods may be attracted by very large packages, perhaps only made available at certain outlets, at special prices. Heavy, regular users of some services might also be specially treated, maybe being enrolled in some «club», or becoming eligible for added benefits by earning points from extra purchases.

Attitudes Segments:- Models of attitude to the brand or to the act of buying the brand, can also provide a basis for segmentation. With attitudes to the brand, it may be that different groups respond differently to several product attributes. «Perceptual maps can be useful here (these will be described in more detail when we look at positioning of products, towards the end of this handout).

Lifestyle Segments:- Lifestyle to marketers is inferred from answers to questions about activities, interests and opinions. Lifestyle segmentation studies normally involve administering several hundred questions on the topics listed in the table below, and a further set on media exposure and brand usage.

Question Areas For Lifestvie Studies

Work	Sports	Media	Products	Family Size
Hobbies	Family	Achievements	Future	Dwelling
Social Events	Home	Themselves	Culture	Geography
Vacation	Job	Social Issues	Age	City Size
Entertainment		Politics	Education	Stage in
Club Membership	Recreation	Business	Income	Lifecycle
Community	Fashion	Economics	Occupation
Shopping	Food

Lifestyle segmentation proceeds by clustering «activity interest opinion» groups by brand usage.

Wells and Tigert give examples of «portraits» constructed from lifestyle research; the heavy user of eye make up for examples is:

— Young well educated, urban.- Uses a lot of other cosmetics.- Reads fashion magazines.- Watches television movies.- Agrees with statements such as «I try the latest hairstyles»

«I usually have one or two outfits in the latest styles»

«I comb my hair and put on hp stick first thing in the morning»

«I like travel»

— Does not like shopping.

— Does not consider herself a homebody.

— Does not enjoy housework.

This is of course a simple example, but it serves to illustrate the degree of portrait build-up possible with appropriate research.

London and Della Bitta provide another example dealing with camera purchases where the contrast between the lifestyle attributes of Nikon camera buyers and all camera buyers is particularly interesting.

Lifestyle research need not be specifically brand related. Davidson reports a study of «shopper types» which revealed the four groups in the table below: —

A Typology of Shoppers

	Relaxed	Controlled	Rigid Personality	Rigid Situation
Approx. %	20%	60%	10%	10%
Demography	Young non- working 45+ part-time	Nothing distinctive	Nothing distinctive	C2, D
Uses a shopping list	No	Partial	Yes	Yes
Experiments?	Yes	Little	No	No
Meets individual preferences	Yes	Yes	No	No
Budget control	Lax	Some	Rigid	Rigid

In Davidson’s typology, the «relaxed shopper» does little planning, is open to substantial in-store influence and is not particularly budget-conscious. The «controlled shopper» uses a list for basic items, but decides on non-standard requirements during shopping. In marked contrast, the last two categories have detailed lists derived from detailed menu planning.

9. Situation Segmentation: — Recently, attention has been increasingly paid to the role of situational factors in segmentation. Dickson argues the importance of the situation in which consumption of the product is to take place. Consider the following products in various situations; in each case a different form of the product would seem appropriate.

The argument is that the same person in different situations would have different needs. Individuals assume different roles in different situations. Dickson argues that the situation broadly defines the role, and the role behaviour may be supported by particular purchases. Dickson goes on to interpret this as a special type of situational/benefit segmentation, in which the benefits sought in different situations would also vary. As the benefits sought vary, then so too would consumers’ evaluations of the attributes of brands; some would score highly in a given situation, and be thought entirely inappropriate in other situations.

A model of Dickson’s methodology in situational/benefit segmentation is shown below

A comprehensive discussion of situation segmentation, with useful examples from hotel and tourist marketing, is provided by Oliver, G in his book «Marketing Today» (Prentice-Hall 1990) Chapter 6

10. Segmentation by Response to Marketing Strategy: — An implication in all approaches to segmentation is that once the segments are identified, then a unique marketing treatment will be applied. However, where the consumer response shows a very marked difference according to marketing treatment, the nature of the treatment can itself become the basis for distinguishing the segments. The most common form of this would be price elasticity, although the same concept could be applied to any part of the marketing mix. Just as with other segmentation bases, there would be a need to establish groups whose response displayed substantial differences. Thus there might be relatively inelastic segments and relatively elastic segments. This could include many aspects of the promotional mix, and so segments might be considered in relation to their response to various elements of the promotional mix, such as advertising, personal selling, sales promotions, public relations, etc. This variable response to promotional mix elements has led to the notion of «deal-prone» segments — the deal being the specific type of promotion. Investigations would further attempt to discern if any demographic variables could additionally be used to describe these segments, mainly because that would be the key to media targeting data.

Another example of segmenting by response to marketing mix elements is to segment by the marketing channels used by consumers. The bed manufacturers, Silentnight, adopt this strategy because bed retailers tend to concentrate on particular price/quality ranges and so attract consumers interested in the selected range. Silentnight markets four brands and each is distinctively placed in respect to retailers and price/quality range:

Now let us turn to segmenting of service markets rather than consumer markets. Segmentation in service markets is complex, and this complexity is caused by the generally very varied and at the same time quite identifiable group of customers served. For example in marketing its rooms a large hotel might consider three gross segments

1. Rack those paying the full rate (rack rate) individuals using a direct channel to the hotel or coming via a travel agent or referral or reservation system organisational customers

2. Commercial

3. Travel Trade usually tour groups, either series or one off

As is typical in service markets, the segmentation base used in this example is multiple: it is a combination of customer characteristics and marketing channel used. To an extent it is also sensitivity to prices, since rack customers pay most, and tour groups lest. Within each of these gross segments there could be a multiplicity of sub segments. The rack segment could be sub segmented by marketing channel, the commercial segment by volume of usage and the travel trade by type of tour, its duration and «package» contents.

A further complication in segmenting service markets is that the customers themselves contribute to the overall image of the service offered. Those in one segment may have requirements which conflict with, or reduce the satisfaction derived by, those in other segments. Managers in service companies thus have a complex balancing act in adjusting their segment mix.

Useful examples of service market segmentation are provided by Lovelock in his book Services Marketing: Texts, Cases and Readings (Prentice-Hall International Editions).

Segmentation can equally well be applied to industrial (or organisational) markets, but the segmentation bases used are different.

The following table gives some idea of the types of variables, which could enter into an industrial segmentation study:-

Industrial Segmentation Variables;

—	Geography	—	Purchasing strategies used by
—	End use of product purchased		buyers
—	Type of business engaged in by the	—	Primary role of buyer
	customer	—	Buyer self confidence
—	Type of supplier profiles developed	—	Differences in buying information
	by customer		processes
—	Type of buying situation (straight	—	Buyer risk tolerance
	rebuy, modified rebuy, new task)	—	Perceptions of risks and problems
—	Type of market served by customer		by buyers
—	Value added by customer	—	Buyer evaluation style
—	Basis for competitive advantage	—	Buyers working relationships with
	eg price, personal selling		others
—	Customer profit margin	—	Buyers workload

A typical application in industrial markets is to segment according to industry type i.e. to classify customers into industry groups. To illustrate, microfilm might be used in administration, for engineering drawings, or in research. If a cross classification of application type by industry is made, the result could be as below.

For the different segments identified in the table above, different product types may be appropriate. They certainly present different situations in terms of system requirements e.g. complexity of indexing of the film, the speed of access needed, and the degree and frequency of updating of material already on film. Promotional methods would also have to be tailored to each specific segment.

Work by Wind and Cardozo suggests that segmentation is little used by industrial marketers, as compared to the use made of it by consumer goods marketers. Their work also concurs with that of Choffray and Lilien, in suggesting that industrial segmentation should be conducted as a two stage process. Firstly, the market should be divided into macrosegments and subsequently into microsegments. Macrosegments could be identified by SIC code (Standard Industrial Classification), by company size or geographically. The microsegments are identified by the composition of the DMU (decision making unit) and are clustered according to their purchasing decision process. In an example from the 3M company, the market for satellite copiers showed two microsegments:

High involvement by purchasing executives n the DMU. Composed primarily of private sector firms.

High involvement by product users in the DMU. Public sector organisations.

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