Market Segmentation
Common Variables
1) Geographic
2) Demographic
3) Psychographic
4) Behaviouristic
Divides the market according to location 🔥
Closely related with the bank's strategy
A regional branch is to service a specific region.
Example: DBS Beijing branch in Beijing.
Advantage 😃
Disadvantage 😃
- Enables the bank to provide convenience of access to target customers by assisting seller to position retail outlets in the most appropriate locations.
- Identify customer needs based on the consumers' own location.
- Less effective when dealing with large business clients that have many locations
- With advancements in electronic banking, the need for convenient branches has decreased.
Divided based on population characteristics 🔥
Consumer wants, preferences, and usage rates are often associated with demographic variables
Easier to measure, and they match well with many financial services.
Groups of people can be readily identified and their needs matched with service features and benefits.
- Life cycle
- Age
- Income
- Gender
Market classification is based on lifestyle and personality. 🔥
Example ✏
Lifestyle : Distinctive ways of living that are reflected in activities and interests
Seeking security
Personality: Based on self images and self concepts
This segment will seek insurance products from well-known and credible insurance companies.
Services targeted at financing country club memberships, and credit cards that provide art tours and unusual travel packages.
Divides customers into groups based on their knowledge, attitude, behaviour towards use or response to a product 🔥
Provide consumer benefits to generate long-term customer satisfaction.
Involves when and where the services take place, the amount of the service, frequency and purpose of use.
Grouping by
- User status
- Usage levels
example ✏
Non-user
Ex-user
First-time user
example ✏
Occasional
light
medium
heavy
- Different benefits (Benefit Segmentation)