Presentation on theme: "Target Marketing Dividing the total market into different segments based on customer characteristics and developing products to meet the needs of those."— Presentation transcript:
Target Marketing Dividing the total market into different segments based on customer characteristics and developing products to meet the needs of those specific segments
All people who make purchases for personal use Current Population: Estimated Population Year 2030: 364 MILLION Population Clocks U.S. 308,603,348 World 6,761,430,702 14:44 UTC Feb 2, 2010 http://www.census.gov/main/www/popclock.html
Where is the Growth? West – 19.7% (Nevada – 66.3%!)South – 17.3% Midwest – 7.9% (Illinois – 8.6%)Northeast – 5.5% Largest American increase: 1990 – 2000 with a 13.2% increase! One birth every................................................ 7 seconds One death every............................................. 12 seconds One international migrant (net) every............ 37 seconds Net gain of one person every......................... 14 seconds
Demographics Geographics Psychographics Statistics to describe population – measurable observable aspects Where people live Geodemography – “Birds of a feather flock together!” How people live AIO / VALS http://www.sric-bi.com/VALS/presurvey.shtml
Expectations of the class – Dazzle me with your knowledge of Demographics, Geographics Psychographics
AGE Generation: when you were born Cohort: when you came of age** **much more important because it defines the group: music, politics, war, culture High Schoolers – What defines you?
AGE Whoopies 35 million – 12% increase since 1990 The MATURE consumer “Well-heeled older persons” 65 + Market
AGE They are at home enjoying leisure time, continued good health and are MOBILE ! What do we sell to them? Easy-open packages Larger print Cosmetics Vacations! Do Not Treat Them as OLD! How do we sell to them? Music Sayings Stars Culture
AGE Whoopies Ages 65-74 “Young Elderly” Financially secure Active & Healthy Targets for leisure market
AGE 1990 – 4%In 2000, 5574 celebrated 65 th 2000 – 12.4%birthday DAILY Companies prepared them for retirement! Travel Market: cruises, elderhostels, trips Education: computers, hobbies, students! Took care of themselves Retirement communities NOT nursing homes
AGE Whoopies Ages 75 + Primarily Women Poor Health Less Mobility (Disability?) Targets for nursing homes and services for the elderly (health)
AGE Men are dying off Less active, rely on others 30% not in institution live alone This Whoopie Market is a group of Haves and Have Nots Retirement, Medical Expenses, FIXED INCOME What do we sell them? Easy openSmall servingsCosmetics Medical EquipmentComfortable clothing, shoes 12% increase since 1990 Will double by 2030
AGE Baby Boomers Born 1946-1964 1997 -- 78 million 27.5% of population Spend $2.1 trillion annually Holds 75% of U.S. financial assets By 2029 those 65+ will control over 40% of U.S. disposable income!
AGE Don’t trust anyone over 30! Used to being the focus Now at Peak Income Getting older, but NOT getting old! TV – Nip/Tuck, Housewives Magazines – Health, Prevention, Cooking Light, Parenting Use their music, attitudes, stars, culture when promoting By 2011 – decline rapidly as a result of deaths
Hottest New Car Segment? Boomer women in their 50s – REWARD CAR! The mid-sized sporty Up 277% since 2000 Don’t forget the manwagon Power, suspension, race car seats and fits the stroller!
AGE Generation X Born 1965-1976 “Baby Bust Generation” birth dearth 45 Million
AGE Generation X Latchkey Generation Felt effects of 1990 Recession High levels of education (47% higher ed) Fashionable, Irreverent, Conservative
AGE Represent $1.4 trillion in annual purchasing power By 2010 – overtake boomers as primary market for almost every product category
AGE How to sell to Generation X Better educated, downwardly mobile More family time, less contentment It’s all about value The “soccer mom” is history Dads do more at home
AGE Generation Y The Millenials Born 1977 - 1994 Baby Boomers having Babies 76 Million Parents at peak earning potential Diverse population “Luxuries” are now “Needs”
AGE Spending up to $159 billion Influence another $30 billion in family spending! Tech Savvy = Impatient, Now-Oriented How do we sell to Gen Y?
AGE Children Born 1995 to present Despite economic downturn, parents do not want to let their children “suffer”
AGE 36 Million kids age 3 – 11 Have $18 billion in disposable income! Influence additional $115 billion Strong Influencers Food Entertainment Cars Vacations clothes
Increasing Diversity More “salad bowl” than “melting pot”
Increasing Diversity White – 67% Hispanic – 14.4% African American – 13.4% Asian American – 4% American Indian, Eskimo, Aleut – 1% 12% were born in another country
Increasing Diversity Underserved Market! 60 Million in U.S. $220 billion in annual spending power Increase as Baby Boomers age And impact of war
INCOME Disposable Income Gross Pay – Taxes = Net Pay Rent, Utilities, Transportation Food, Clothing, School Supplies Medicine, Personal Care Marketers of Necessities
INCOME Net pay – basic expenses Travel, Entertainment, Upgrades Discretionary Income
INCOME VALUE MARKETING Wild spending of the 1990s has been dashed by the recession of 2000 Distribution is still skewed Top 1% of U.S. families control 33% of wealth Bottom 90% control 30% of wealth
INCOME Upper Class – luxury goods, not impacted by recent economy Middle Class – careful with spending but not doing without Working Class – stick with basics, hard to save Under Class – count pennies to make even basic purchases