Focusing on Market Segments Making an Impact with the Ultimate Customers Copyright © Texas Education Agency, All rights reserved.

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Goals for this Lesson Define demographic segmentation Define psychographic segmentation Define geographic segmentation 3 Copyright © Texas Education Agency, All rights reserved.

Goals for this Lesson Define product usage segmentation Define benefits derived segmentation Explain how to evaluate market potential and calculate market share 4 Copyright © Texas Education Agency, All rights reserved.

Demographic Segmentation Education AgeIncomeRaceGender 5 Copyright © Texas Education Agency, All rights reserved.

Psychographic Segmentation Lifestyle How individuals spend their spare time Social interests Emotional well being 6 Copyright © Texas Education Agency, All rights reserved.

Geographic Segmentation ZIP Code Dividing consumers into markets based on where they live Congressional district Climate and land (examples: moderate and plains) 7 Copyright © Texas Education Agency, All rights reserved.

Product Usage Segmentation How frequently a product or service is used Quantity purchased or consumed Usually based upon customer’s experience 8 Copyright © Texas Education Agency, All rights reserved.

Benefit Segmentation/Expectations Consumer market –Shampoo for oily hair, dry hair, or normal hair –Product frequency of use Business market –Size of business –Geographic location of business –Products and services offered by the business 9 Copyright © Texas Education Agency, All rights reserved.

Evaluating Market Potential Market Opportunity –Number of potential customers –Customers’ interest in the product or service and other mix elements –Amount of money customers have available to make the purchase –Business’s ability to communicate with and distribute the product to consumers 10 Copyright © Texas Education Agency, All rights reserved.

Calculating Market Share Portion of total market potential that each company expects in relation to its competitors Percentage of total sales of a particular good or service Percentage of total units sold for a given product or service 11 Copyright © Texas Education Agency, All rights reserved.

Assignments Students will complete the First Part of the “Marketing to the Generations” project. Students will match goods and services to the demand of different market segments. Using the Product/Service Inventions for an Aging Population Assignment, students will research different market segments to identify products or services that will be in high demand for an aging population. 12 Copyright © Texas Education Agency, All rights reserved.