Market Segmentation Flashcards
All 9 cards in this deck
What is market segmentation?
Dividing a market into groups of customers who share similar characteristics or needs.
Name the five ways of segmenting a market given in the specification.
Location, demographics, lifestyle, income and age.
What does segmenting a market by 'demographics' mean?
Grouping customers by measurable population characteristics such as gender, family size, religion or ethnicity.
What does segmenting a market by 'lifestyle' mean?
Grouping customers by how they live — their interests, habits and values, e.g. vegans or regular gym-goers.
True or false? Profit is a way of segmenting a market.
False. Income is a way of segmenting a market; profit and cost are not.
What is market mapping?
Plotting businesses or products on a diagram with two features as axes, e.g. price and quality, to show where each one sits.
True or false? A market map shows how many customers there are in a market.
False. A market map is used to spot a gap in the market and show where competitors are positioned.
What are the steps to use a market map to find a gap in the market?
e.g. mapping the coffee shops in a town- Choose two features as axes: price (low–high) and quality (low–high).
- Plot each competitor: the town's coffee shops.
- Look for an empty area: e.g. no high-quality, low-price shop = a possible gap.
What is a target market?
The particular segment of customers a business aims its product at.