Market Segmentation:

Marketing segmentation is like sorting customers into groups based on what

they need or like, so businesses can create specific strategies for each group.
Geographic Segmentation: Geographic segmentation involves dividing a
market based on physical locations such as nations, regions, states, cities, or
even climate zones. This segmentation recognizes that consumer needs and
preferences can vary significantly based on where they are located. For
example, a company might adjust its product offerings or marketing strategies
to better suit the cultural and environmental aspects of a specific region.
Example: Grameen Danone, a social business in Bangladesh, tailors its
nutritional products to address specific needs in different regions, considering
factors like dietary preferences and health concerns.
Demographic Segmentation: Demographic segmentation categorizes the
market by demographic factors such as age, gender, income, education, and
more. Understanding the characteristics of a population helps businesses tailor
their products and marketing messages to specific consumer groups. This
segmentation strategy is especially useful for products or services that have
clear demographic preferences.
Example: The mobile operator, Robi Axiata, customizes its mobile plans based
on demographic factors such as age and income, offering specialized packages
for students or professionals.
Psychographic Segmentation: Psychographic segmentation delves into the
lifestyle, personality, and values of consumers. This approach recognizes that
people with similar interests or attitudes may have similar purchasing behaviors.
Companies using psychographic segmentation seek to connect with consumers
on a deeper, more personal level, aligning their products with the target
audience's values and lifestyle.
Example: A lifestyle brand like Aarong in Bangladesh tailors its marketing and
product offerings to resonate with the cultural and aesthetic preferences of
specific psychographic segments.
Behavioral Segmentation: Behavioral segmentation divides the market based on consumer
behavior, including occasions, benefits sought, user status, usage rate, and loyalty. Understanding how
consumers use and perceive a product allows businesses to create targeted marketing strategies and
product offerings that align with specific behavioral patterns.
Example: Coca-Cola in Bangladesh might implement behavioral segmentation by offering different
advertising strategies during festive occasions, emphasizing the brand's association with celebrations.
 Segmenting international markets
Segmenting international markets involves dividing the global market into
distinct groups based on factors such as cultural differences, economic
variations, and other relevant differences across countries. This approach
recognizes that different regions may have unique needs, preferences, and
behaviors, requiring tailored marketing strategies. By understanding and
responding to these variations, businesses can effectively navigate the
complexities of international markets and better meet the diverse demands of a
global customer base.

Requirements for effective segmentation:

Measurable. The size, purchasing power, and profiles of the segments can be
measured.
Accessible. The market segments can be effectively reached and served.
Substantial. The market segments are large or profitable enough to serve. A
segment should be the largest possible homogeneous group worth pursuing with
a tailored marketing program. It would not pay, for example, for an automobile
manufacturer to develop cars especially for people whose height is greater than
seven feet.
Differentiable. The segments are conceptually distinguishable and respond
differently to different marketing mix elements and programs. If men and
women respond similarly to marketing efforts for soft drinks, they do not
constitute separate segments.
Actionable. Effective programs can be designed to attract and serve segments.
For example, although one small airline identified seven market segments, its
staff was too small to develop separate marketing programs for each segment.
 Market targeting strategies
Undifferentiated (Mass) Marketing: Undifferentiated marketing involves
treating the entire market as a single entity and targeting it with a standardized
product and marketing mix. This strategy assumes that the target market has
similar needs and preferences. While cost-efficient, it may overlook variations
in customer segments.
Example: Pran, a renowned food and beverage company in Bangladesh, adopts
undifferentiated marketing for staple products like bottled water, appealing to a
broad consumer base.
Differentiated (Segmented) Marketing: Differentiated marketing tailors
products and marketing strategies to different segments of the market based on
their distinct needs and preferences. This strategy acknowledges the diversity in
customer requirements and aims to capture a broader market share by
addressing various segments.
Example: Unilever in Bangladesh employs differentiated marketing for its
personal care products, creating variations of brands like Lux and Dove to
appeal to different target segments.
Concentrated (Niche) Marketing: Concentrated marketing focuses on a
specific niche or target market segment. This strategy is effective for smaller
companies or those with limited resources, allowing them to specialize and
excel in serving a particular customer group.
Example: Square Pharmaceuticals in Bangladesh practices concentrated
marketing by targeting specific therapeutic areas, such as cardiovascular drugs,
to address the unique needs of those patient groups.
Micromarketing (local or individual marketing): Micromarketing involves
tailoring products and marketing strategies to suit the preferences of individual
customers or local communities. This strategy emphasizes personalized
interactions and customization.
Example: A local bakery in Bangladesh engages in micromarketing by
customizing cake designs based on individual customer preferences and local
cultural events.
 Choosing a market-targeting strategy

Choosing a market-targeting strategy involves considering factors like company

resources, product variability, product life-cycle stage, market variability, and
competitors' strategies. Limited resources often make concentrated marketing
more practical, while undifferentiated marketing suits uniform products.
Differentiated or concentrated marketing is preferred for products with design
variability, especially in the mature stage of the product life cycle. Market
variability influences the choice, with undifferentiated marketing suitable when
buyers have similar preferences. Competitors' strategies also play a role; when
competitors use differentiated marketing, a firm might gain an advantage
through undifferentiated or concentrated marketing.
Example: In Bangladesh, Jamuna Group, a diversified conglomerate,
strategically uses concentrated marketing for its electronics division, tailoring
products to meet the specific needs of tech-savvy consumers in the local market.

Competitive advantages:

Which differences should be promoted? Not all brand differences are

meaningful or worthwhile. Each difference has the potential to create company
costs as well as customer benefits. A difference is worth establishing to the
extent that it satisfies the following criteria:
Important. The difference delivers a highly valued benefit to target buyers.
Distinctive. Competitors do not offer the difference, or the company can offer it
in a more distinctive way.
Superior. The difference is superior to other ways that customers might obtain
the same benefit. Communicable. The difference is communicable and visible to
buyers.
Preemptive. Competitors cannot easily copy the difference.
Affordable. Buyers can afford to pay for the difference.
Profitable. The company can introduce the difference profitably.