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How The Demographic And Psychographic Segmentation Work Marketing Essay

The most important goal of an organizations marketing strategy is to understand and satisfy people and fulfill their needs better than the competitors. Individuals Segmentation involves subdividing customers into groups with different needs, to create tailored bases which meet these needs as close as possible. There are many bases for segmenting, the most important ones are Geographic, Psychographic, Behavioral and Demographic segmentation .In this essay I'm going to discuss about the demographic and psychographic approach and why they were assumed to be the best approaches once combined.

The demographic approach consists of dividing the market into groups based on variables such as age, gender, income, occupation, education, religion. The main demographic variables are summarized below:

Age

Consumer needs and wants change with age although they may still wish to consume the same types of product. So Marketers design, package and promote products differently to meet the wants of different age groups. Good example includes the marketing of toothpaste brand, and how it is different when you target a child and adult, a child would prefer a tooth paste with candy taste and cartoons drawn on it, but the adult might prefer an additional tooth paste pack as a promotion or a tooth brush.

Gender

Gender segmentation is widely used in consumer marketing. The best examples include clothing, hairdressing, magazines and cosmetics. Females obtain to consume more on the cosmetics then males, also in the clothing males might prefer to wear casual and sporty outfit which females might not like to wear. Also the males might spend more money on buying electronics and gadgets which the majority of females don’t get interested in. So there is a difference in taking an approach buying decision depending on the gender.

Income

Many companies target affluent consumers with luxury goods and convenience services. Good examples include Rolls-Royce luxury cars for the elite people; private jet airline companies. By contrast, many companies focus on marketing products that appeal directly to consumers with relatively low incomes since the majority of the world population is limited income classified. Examples Fly Nas Airlines they provide affordable cheap boarding tickets domestically and internationally for those who only seek to travel without looking for luxury service.

Religion

Depending on the religious beliefs marketing segments the community into groups and target them on that basis. Here in Saudi Arabia a country known for its Islamic religion and moderate community and the majority of the expertise that live here are also Muslims companies launch products that are in first place approved from the Islamic law (Sharia) for example most packed food are stamped with the word ((Halal)) which means that the meat has been slaughtered based on Islamic way or that the packed food doesn't contain any forbidden ingredients like pork, other communities like the UK the banks noticed that there is a large portion of the community who are Muslims then banks there launched the Islamic banking although the bank management and share holders are commonly non-Muslims but banks seek to do business so they had to provide what is legible for the Islamic community needs and expectations in the UK.

Occupation / Education

Also to mention as demographic variables occupation and education, regarding the occupation variable for example a doctor might be more interested in buying healthy organic food while the bus driver might be interested in buying fast food because it is cheap and he can locate it any where but the doctor because his medical background and knowing that consuming such junk foods would cause him problems on he long term run. The education variable , when the customer is educated the mentality is different from the uneducated ,For example the educated customer when he enters the bank he might seek advanced products such as saving plans for his family members although it is a long term un seen investment, while the un educated might want only to invest his money in land property or home mortgage ,So buy knowing the education and occupation it will make it easy for marketers to know the personality that they are going to deal with.

Now the second approach, the Psychographic segmentation is also known as behavioral segmentation is based on customer’s lifestyle, activities, interests, and opinions. This type of segmentation divides the market into groups according to customers’ lifestyles.  It considers a number of potential influences on purchase buying behavior, including the attitudes, expectations and activities of consumers.  If these are known and well understood, then products and marketing campaigns can be customized and lunched so that they appeal more specifically to customer motivations and needs. The main psychographic segmentation variables are:

Lifestyle – different people have different lifestyle patterns and our behavior may change as we pass through different stages of life.  For example, a family with young children is likely to have a different lifestyle from a much older couple whose children have left home, the first family usually have a fast life style with long term future plans and worries about their children education and health, the second family who are living alone they often have a stabled and secure life with nothing to worry about and usually they are less motivated in trying new things or products like dealing with the latest computer technology, therefore, likely to be significant differences in consumption patterns between the two groups. 

Opinions, interests and hobbies – this includes consumers’ political opinions, views on the environment, sporting and recreational activities and arts and cultural issues.  The opinions that consumers hold and the activities they interact with will have a huge impact on the products they buy and marketers need to be aware of any changes.  examples include the growth of demand for organic foods or products that are environmentally friendly. That can be seen in our hypermarkets here in Riyadh they created a section for these types of products.

Loyalty – customers who buy one brand either all or most of the time are valuable and got used to firms.  By segmenting markets in this way, firms can adapt their marketing in order to retain loyal consumers, rather than having to focus constantly on creating new customer potential.  It is often said that it is ten times more profitable selling to existing customers than trying to find new ones, because it saves time and money. 

Occasions – this segments on the basis of when a product is purchased or consumed.  For example, some consumers may only purchase new thobe, furniture or boxes of chocolates for celebrating Eid, whereas other consumers may buy these products on a monthly basis.  Marketers often try to change customer perception of the best time to consumer a product by promoting alternative uses for a product.  For example, recently Kudu (a local fast food chain restaurant) has attempted to change their menu by adding a breakfast menu so to be consumed all day meals not just for lunch and dinner.

Benefits sought – this requires marketers to identify and understand the main benefits consumers look for in a product.  Car, for example, is not only bought to transport the consumer from one place to an another, some might also want to have leather air conditioned seats, DVD and a sun roof top ECT.

Usage – some markets can be segmented into light, medium and heavy user groups.

We've seen that segmentation subdivides the market into a number of groups, and it helps the organizations to target specific groups by developing advertising programs for each segment or develop new attractive products, that’s why the grow of target marketing method is more then the mass marketing as it helps the organizations to reach greater customer needs as close as possible by studying the consumers.

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