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Define the term market segmentation - Leaving Cert Business - Question C - 2021
Question C
Define the term market segmentation. Illustrate two different ways a market can be segmented.
Worked Solution & Example Answer:Define the term market segmentation - Leaving Cert Business - Question C - 2021
Step 1
Define the term market segmentation.
Answer
Market segmentation refers to the process of dividing a broad target market into smaller, clearly defined sections that share common characteristics. This allows firms to identify their target market more effectively. It involves analyzing consumer segments based on shared traits and then designing marketing strategies tailored to each segment's specific needs and preferences.
Step 2
Illustrate two different ways a market can be segmented.
Answer
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Demographic segmentation: This approach analyzes consumers based on characteristics such as age, gender, income, family size, and occupation. For instance, businesses like Nintendo target specific age groups, or clothing brands like Topshop may design different products for males and females aged 15-35.
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Geographic segmentation: This method segments the market based on the location of consumers, such as region, county, or climate. For instance, a car manufacturer may develop different vehicle models for consumers living in colder climates compared to those in warmer regions.