Author: Jim Riley Last updated: Sunday 23 September, 2012
Demographic segmentation consists of dividing
the market into groups based on variables such as age, gender family size,
income, occupation, education, religion, race and nationality.
As you might expect, demographic segmentation variables
are amongst the most popular bases for segmenting customer groups.
This is partly because customer wants are closely linked
to variables such as income and age. Also, for practical reasons, there is
often much more data available to help with the demographic segmentation process.
The main demographic segmentation variables are summarised
Consumer needs and wants change with age although they
may still wish to consumer the same types of product. So Marketers design,
and promote products differently to meet the wants of different age groups.
Good examples include the marketing of toothpaste (contrast the branding
toothpaste for children and adults) and toys (with many age-based segments).
A consumer stage in the life-cycle is an important variable
- particularly in markets such as leisure and tourism. For example, contrast
the product and promotional approach of Club 18-30 holidays with the slightly
more refined and sedate approach adopted by Saga Holidays.
Gender segmentation is widely used in consumer marketing.
The best examples include clothing, hairdressing, magazines and toiletries
Another popular basis for segmentation. Many companies target
affluent consumers with luxury goods and convenience services. Good examples
include Coutts bank; Moet & Chandon champagne and Elegant Resorts - an
up-market travel company. By contrast, many companies focus on marketing products
that appeal directly to consumers with relatively low incomes. Examples include
Aldi (a discount food retailer), Airtours holidays, and discount clothing
retailers such as TK Maxx.
Many Marketers believe that a consumers "perceived"
social class influences their preferences for cars, clothes, home furnishings,
leisure activities and other products & services. There is a clear
link here with income-based segmentation.
Marketers are increasingly interested in the effect of
consumer "lifestyles" on demand. Unfortunately, there are many
different lifestyle categorisation systems, many of them designed by advertising
marketing agencies as a way of winning new marketing clients and campaigns!