Market Segments: Clustering Analysis

Question 1

Segmenting

Answer 1

The process of finding useful ways of grouping consumers based on demographic, psychographic, geographic, and behavioural attributes

Question 2

Targeting

Answer 2

Assess attractiveness of each segment and choosing which segs to target

Question 3

Positioning

Answer 3

How you will position and differentiate the offering & create value

Question 4

Positioning statement

Answer 4

Target audience, brand name, competitive framework that offers PoD, reason

eg: for cost-conscious moms of large blue-collar families (target) with active children, Tide is the brand of laundry detergent that keeps gets clothes cleaned and keeps them looking new because of… (PoD/Value)

Question 5

Segmentation & research

Answer 5

Design research with seg strategies in mind

Make sure you reach key segments
Make sure you ask right questions in order to segment

Question 6

Limitations of demographic segmentation

Answer 6

Consumers share the same demographics but still are different

Question 7

Psychographic seg

Answer 7

Seg the market based on psychological characteristics (personality, values & lifestyle, opinions, interests)

Question 8

How to evaluate segments (ISRRP)

Answer 8

Identifiable (could two segs be met with the same 4Ps?)
Substantial (large enough seg?)
Reachable (seg willing/able to receive comms from us?)
Responsive (seg willing/able to buy product from us?)
Profitable (is the seg financially attractive for us?)

Question 9

Psychographic characteristics (AMPA)

Answer 9

Ambition (achievement, status, exhibition, uniqueness)
Materialism (acquisition, order)
Power (dominance, autonomy, aggression)
Affection between people (affiliation, play, sex)

Question 10

Cluster

Answer 10

Seg or group of consumers that share similarities based on specified seg attributes (demographic, psychographic, behavioural)