Advertising Primer 8: Defining Your Target Market
Rarely will an advertiser seek to reach every person or business in a given market. Instead, advertisers typically seek to break markets into segments using various methods. Market segmentation is the process of dividing a market into groups that share similar characteristics.
Targeting involves selecting individual segments to pursue with advertising and marketing efforts. These target markets are the foundation of any good marketing plan because they represent the groups of consumers (or businesses) most likely to purchase a given product.
Many different characteristics can be used to segment markets, including:
Demographics: Includes gender, age, education, income, race and ethnicity. These are generally the most-used characteristics of market segmentation.
Geographics: By grouping markets by region, geographic segmentation proves useful for advertisers who offer products or services in select areas.
Psychographics: This method of segmentation attempts to determine why certain groups of people make certain purchase choices based on their attitudes, interests, and opinions (AIO). By grouping people based on psychological factors, advertisers can reach segments that transcend traditional demographic or geographic areas.
Geodemographics: This is a combination method that groups demographic, geographic, and psychographic data to form more precise segmentation.
Benefits: The benefits segmentation method groups consumers based on the benefits they receive from a product or service. This method is similar to psychographics in that it attempts to gain insight from the needs and wants of the audience instead of innate characteristics of the market segments themselves.
Usage or Behavior: Often as few as 10% of a company's customers are responsible for as much as 90% of sales. Usage (or purchase behavior) segmentation attempts to identify these "heavy users" so the majority of advertising efforts can be targeted towards them. (Customers who purchase less often are called "light users.")
When marketing to other businesses, companies attempt to segment markets in similar ways. Like consumers, businesses can be segmented based on geographic location or product usage trends. However, businesses can also be grouped with such characteristics such as industry, business type, or business size.
Targeting involves selecting individual segments to pursue with advertising and marketing efforts. These target markets are the foundation of any good marketing plan because they represent the groups of consumers (or businesses) most likely to purchase a given product.
Market Segmentation
Many different characteristics can be used to segment markets, including:
Demographics: Includes gender, age, education, income, race and ethnicity. These are generally the most-used characteristics of market segmentation.
Geographics: By grouping markets by region, geographic segmentation proves useful for advertisers who offer products or services in select areas.
Psychographics: This method of segmentation attempts to determine why certain groups of people make certain purchase choices based on their attitudes, interests, and opinions (AIO). By grouping people based on psychological factors, advertisers can reach segments that transcend traditional demographic or geographic areas.
Geodemographics: This is a combination method that groups demographic, geographic, and psychographic data to form more precise segmentation.
Benefits: The benefits segmentation method groups consumers based on the benefits they receive from a product or service. This method is similar to psychographics in that it attempts to gain insight from the needs and wants of the audience instead of innate characteristics of the market segments themselves.
Usage or Behavior: Often as few as 10% of a company's customers are responsible for as much as 90% of sales. Usage (or purchase behavior) segmentation attempts to identify these "heavy users" so the majority of advertising efforts can be targeted towards them. (Customers who purchase less often are called "light users.")
Business Segmentation
When marketing to other businesses, companies attempt to segment markets in similar ways. Like consumers, businesses can be segmented based on geographic location or product usage trends. However, businesses can also be grouped with such characteristics such as industry, business type, or business size.
posted by David Board at
12:54 AM
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