Segmentation

• Market segmentation - involves dividing the population of possible customers into groups who share common characteristics, needs, purchasing behavior, and/or consumption patterns
• Ways to segment a market: demographic segmentation,

  psychographic segmentation, behavioral segmentation, and needs-based segmentation
• Demographic segmentation - age, gender, and income
• Psychographic segmentation - reflects people's lifestyles, attitudes, and aspirations
• Behavioral segmentation - focuses on observable behavior such as people being non-users, light users, or heavy users
• Needs-based segmentation - focuses on what customers truly want in a service and maps closely to the multi-attribute decision models
• People different needs and decision making criteria:

  Purpose of using the service

  The individual who makes the decision

  The timing of use (time of day/week/season)