What are the criteria for market segmentation?

The variables that subdivide the consumer market mainly include geographical variables, demographic variables, psychological variables and behavioral variables. Based on these variables, market segmentation has produced four basic forms of market segmentation: geographical segmentation, demographic segmentation, psychological segmentation and behavioral segmentation.

1. Market segmentation according to geographical variables. That is, according to the geographical location and natural environment of consumers, the market is subdivided. Geographical variables can be used as the basis of market segmentation, because consumers in different geographical environments often have different needs and preferences for the same product, and they will have different reactions to the marketing strategies and measures adopted by enterprises.

2. Divide the market by demographic variables. In other words, market segmentation is based on demographic variables, such as age, gender, family size, family life cycle, income, occupation, education level, religion, race and nationality.

3. Market segmentation according to psychological variables. That is, the market is subdivided according to social class, lifestyle, personality and other psychological factors.

4. Market segmentation through behavioral variables. In other words, buyers are divided into different groups according to their understanding, attitude, use and reaction to products. Many people believe that behavioral variables can more directly reflect the differences in consumer demand, thus becoming the best entry point for market segmentation.

Extended data

The concept of market segmentation was put forward by Wendell R.Smith, an American marketing scientist, in 1956.

Market segmentation means that enterprises divide customers in the market into several customer groups according to certain standards, and each customer group constitutes a sub-market. There are obvious differences in demand between different sub-markets. Market segmentation is the basis of selecting the target market. The marketing activities in an enterprise include subdividing a market and taking it as the company's target market, and designing the correct "combination" of products, services, prices, promotion and distribution systems to meet the needs and desires of customers in the subdivided market.

Many product markets in the United States changed from seller's market to buyer's market after World War II, which is the new development of enterprise's marketing concept and strategy under the new market form, and also the inevitable product of enterprises implementing modern consumer-centered marketing concept.

Baidu Encyclopedia: Market Segmentation