McDonald's serves beer in their German restaurants, but not in the US. While geography is objective, personality traits, interests, and behaviors are all much more subjective. Let’s say, instead of using beef, in India McDonalds burgers are made from chicken due to religious beliefs. Income Middle-income people Density of area Urban. Segmentation generally divides a population based on variables. Geographic segmentation is the process of dividing people into groups based on location, such as city, country, state, region, and even continent. Searching for “lawn care,” Google displayed two options for lawn care in my immediate area: In my Facebook feed, this ad showed, also based on where I live: In addition to knowing the geographic segmentation definition, it’s even more important to know why it’s necessary for marketing. An example of geographic segmentation can be seen in the seafood industry. Market segmentation is the analysis of population demographics so they can be categorized in specific ways. Geographic segmentation is commonly used when an organization launches a product or service in a new geographic location. It’s much easier to identify someone’s location than it is to determine the different elements of their psyche or their behavioral tendencies. Geographic segmentation is when a business divides its market on the basis of geography. Such products are marketed using geographic segmentation as it helps marketers to target the specific people living in that area. Whether you’re using it in coordination with the other types of segmentation or on its own. ), but also on various geographic factors, such as climate, cultural preferences, populations, and more. Fast food and restaurant businesses are a prime example. The process is relatively simple because companies can easily get demographic data. Another example of population-based segmentation includes head-covering scarves company that basically targets the population that will want a scarf, e.g. Bases of Market Segmentation – With Variables Used by Marketers for Each Type of Segmentation 1. Geographic segmentation variables can include: city; state; country; population density; economic status; zip code; regional climate ; However, geographic segmentation can also include geographic regions that aren’t technically defined, such as neighborhoods. There are many similarities between consumer and business behavior, and therefore similar segmentation bases and variables apply. How demographic segmentation works. Segmentation variables can be grouped into four categories: demographic, geographic, psychographic, and behavioristic (Pride/Ferrell, (2006), p. 209). A youngster might want a mobile phone but an earning professional will want a communicator with lots of extra features such as email and file editing support. © 2020 Postclick, Inc. All Rights Reserved. What is geographic segmentation? Geographic segmentation is also an effective tool that can be used by small companies. Geographic segmentation is used when a product or service would appeal to individuals within a specific community, state, and region of a country or group of countries. People living in urban, suburban, and rural areas often have contrasting wants and needs, so to make advertising more personalized, geographic segmentation makes sense. They’ve also incorporated local foods on their menu in some locations -- the McArabia in the Middle East, banana pie in Brazil, and the McVeggie, salsa bean burger, and other unique items in India: Seafood is heavily marketed along the east and west coast in the US. Demographic Segmentation tells the firm who is their most likely customer to buy the product or service. Climate-based segmentation refers to marketing products that adhere to a certain climate of an area. Geographic Segmentation Examples and Variables. Climate - such as cold and hot regions or wet and dry regions of a country - is also a consideration in geographic segmentation. Products that serve different needs and wants of people living in rural and urban areas adopt rural and urban segmentation to convey their message to potential customers. Geographic market segmentation divides the market into geographical units, which can be nations, states, regions, cities or even neighbourhoods. -- because that’s where they’ll generate the most business: Products can also be considered more seasonal, instead of regional. 1 2 3 TASK 1 - Segmentation Variables Bases for Segmentation ("Segmentation Variables") Demographic Benefits Geographic Psychographic/Lifestyle Behavioral/Usage - Rate of Consumption/Purchase Adopter Category Behavioral/Usage - Occasion/Situation Ref. (1)Geographic segmentation is based on geographic location, such as region, state, or city. The four criteria used in the segmentation process is geographic, demographic, psychographic and behavioral. Geographic segmentation is when a business divides its market on the basis of geography. Market segmentation is one of the marketing concepts that are relatively long applied in business practice. (5-45 years) Country Bangladesh Generation Young, adult Region Bashundhara,Baridhara, Dhaka. Having more than 640 outlets and serves more than 2 million customers a week. This type of segmentation helps to reach out to customers living in a similar region or area and have identical needs. The process is relatively simple because companies can easily get demographic data. KFC has a wide geographic segmentation in Australia. This is especially true for large, multinational businesses because it helps them understand location-based attributes of a specific target market, which enables them to better address the varying wants and needs of customers in these different regions. It refers to statistical data about a group of people. since there is a constant supply of fresh seafood throughout the year. In South India, vegetarians are the main selling products, while in North India focus Chicken products. Knowing your customers well allows you to offer a more personal value proposition that addresses specific topics and needs. Geographic segmentation is a process of grouping customers based on where they live. ), but also on various geographic factors, such as climate, cultural preferences, populations, and more. Psychographic segmentation has 5 variables – Personality, Lifestyle, Social Status, AIO (Activities, Interests, Opinions), and Attitudes. Schedule a product demo to learn more. To know more please refer to our. Geographic segmentation is the market segmentation strategy in which the market is divided on the basis of regions or geographies. McDonalds segmentation, targeting and positioning is one of the integral components of its marketing strategy. Geographic segmentation can be classified by parameters like countries, states, cities, villages, urban / rural, climatic conditions, density of population. Geographic segmentation is different from the other types of market segmentation (especially psychographic and behavioral) because it requires fewer data points. Demographic segmentation variables 1. Geographic variables such as climate, terrain, natural resources, and population density also influence consumer product needs. Product A restaurant chain that offers local dishes in each location. In western countries, such companies will target population where more Muslim women are present to buy their product. Demographic market segmentation is all about people. We use cookies to give you the best experience on our website, deliver our services, personalize content, and to analyze traffic. Since people in different locations are bound to display different characteristics and have various wants and needs, geographic location is an integral factor in determining market positioning and product sales. Get the latest trends, tactics, and thought leadership for advertising conversion and post-click automation. Geographic segmentation divides a target market by location so marketers can better serve customers in a particular area. Generally, this type of segmentation is practiced by organizations that work on a large scale. Understanding the psychology is critical for a business to prosper. geographic segments: Segmentation of consumers based on geographical factors such as location, weather, topography, population density, etc. Demographic Segmentation. Companies also design their marketing campaigns based on geographic segmentation making population its parameter. Market segmentation is a process of dividing a heterogeneous market into relatively more homogenous segments based on certain parameters like geographic, demographic, psychographic, and behavioural. Age is the most basic demographic segmentation variable. For instance, a retailer in the northern United States that sells products for multiple climates and conditions (e.g., Target or Walmart) should advertise their winter gear in the fall and winter months, and their summer gear in the spring and summer months. Remember, geographic segmentation is not based solely on units of geography. Psychological segmentation, such as lifestyle and attitudinal variables, are also useful for particular types of products. This can be the density of population or the population of a specific area. Segmentation is about breaking the population into smaller segments. Geographic segmentation: rural, urban and semi urban. Some common types of market segmentation variables used by companies to market their products are discussed with below examples. McDonald’s already introduced Maharaja Mac Burger (Big Mac) with no beef and pork due to Hindu Muslim population. Geographic Segmentation Examples Categorizing customers according to the geographic units, and marketing products that are customized to individual group requirements, is the basic concept. Saturation of the market and consumer heterogeneity caused that segmentation, despite some criticism, continues to be an important marketing Market Segments and Targets The segmentation of the market helps the marketers to identify the customers who share the same needs and wants (Kotler, & Keller, 2012). Thus demographic segmentation too has its own variables such as Age, gender, family size, income, occupation, religion, race and nationality. More specifically, it’s why you should have geographic segmentation in your marketing and advertising campaigns. See how easy it is to create unique experiences for any audience you target. This is something you should take into consideration when creating your marketing strategy. This type of market segmentation is based on the geographic units themselves (countries, states, cities, etc. Geographic Market Segmentation. Geographic segmentation is a process of grouping customers based on where they live. Geographic Segmentation: It is the segmentation on the basis of region of a country or the world, market size, market density, or climate. McDonalds sells burgers and target local markets and with customized menus. These specific ways of categorization in market segmentation are why segmentation variables are needed and used. Age. It can help you tailor your approach during seasons customers may need your product. Climate. Matching those products and advertising techniques to specific geographic locations means you’re reaching more relevant audiences and not wasting your time or budget. Based on these variables companies can target homogeneous groups of … Season and Climate (winter, summer, spring). Geographic segmentation – grouping customers with regards to their physical location. The other types of segmentation are demographic segmentation, behavioral segmentation, geographic segmentation. For example, a fisherman in Alaska may only buy more equipment leading up to the salmon season. Swimwear brands, on the other hand, should target warmer climates -- areas with beaches, resorts, etc. The first group of market segmentation criteria is based on geographic variables. People are more interested in products that are of high quality and of low cost. You also need to consider other variables. 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Some companies offer products that are specifically used in some countries only, such as snow shovels are used in snowy areas only. Age is the most basic variable of them all, albeit the most important because consumer preferences continually change with age. Geographic segmentation and personalization don’t stop with an ad click. Geographic variables Climate, area and topography are 3 major factors that are composed in geographic variables under the market segmentation. There is no point in marketing snow shovel in areas that are either warm or mildly cold areas with no snowfall. As a result, it offers a quick and effective route into personalized marketing and can offer tangible ways to reach potential customers using only their location as a starting point. Common business segmentation approaches include: Organization size: segmentation according to large, medium, and small customers by revenue, by number of employees, by geographic reach, etc. People in different parts of the world, display different characteristics. Thus companies market their low-cost products towards areas with low purchasing power and their high-cost products towards areas with high purchasing power. Keeping in view the geographic need of the customers, KFC sells it product the reach the target market worldwide. Examples of products or services that use geographic market strategy include local salons that target their services and products towards the population of a specific area e.g. Income Middle-income people Density of area Urban. This also allows them to devise market strategies that will stretch both company’s budget and customer base. This is because consumer needs and wants change with their age. Similarly, in urban areas, customers prefer their detergent products to be of high quality, fragrant and have other similar qualities even if they cost a bit higher than their almost equivalent low costing substitutes. In marketing, geographic segmentation is when a business divides its target market based on location in order to better tailor its marketing efforts There are several ways in which geographic segmentation can be performed. 9 Examples of Geographic Segmentation posted by John Spacey, June 02, 2018. For instance, dress up, outlook, and attitudes. The following ads target by geographic unit. When companies market a product by region, they must keep in the mind the regional preferences heavily in one region as compared to other regions, this type of segmentation is referred to as regional segmentation. Psychographic Segmentation Variables. Currently, KFC has employed 34000 Aussies. Geographicsegmentation is used when a product or service would appeal to individuals within a specific community, state, and region of a country or group of countries. Companies segment their target market geographically when needed to focus on a specific area. Geographic market segmentation is the right marketing strategy to use as it helps in targeting areas where more buyers of a product are located. Geographic market segmentation tends to optimize the marketing strategies of a business by matching products and services to different regions, cities and countries where the customers live. Market segmentation is a process of dividing a heterogeneous market into relatively more homogenous segments based on certain parameters like geographic, demographic, psychographic, and behavioural. Geographic segmentation is a marketing strategy used to target products or services at people who live in, or shop at, a particular location. Saturation of the market and consumer heterogeneity caused that segmentation, despite some criticism, continues to be an important marketing She is a graduate of St. Bonaventure University with a Bachelor’s degree in Journalism and Mass Communication. Climate-based segmentation involves marketing based on a region’s weather. (5-45 years) Country Bangladesh Generation Young, adult Region Bashundhara,Baridhara, Dhaka. Demographic Market Segmentation. KFC has an international presence and has a number of outlets in different countries. This is due to the fact that fresh supply is available in these areas all year round, and catering to the demands of customers in these areas is easy. People living in the same environment tend to have similar wants and needs, and geographic segmentation allows marketers to target audiences in a country, city or region with messaging that appeals to their specific wants and needs. Since the better you know a customer, the more personalized offer you can provide, and the higher the chance your campaign will result in the desired outcome. Small businesses can target their specific customers and focus primarily on marketing their products. Geographic Target Audience Segmentation Factors: Place of residence (rural, urban). For example, Dart and True Temper are companies that market their snow shovels in countries with cold temperatures and where snowfall is a normal occurrence. Under demographic segmentation, a marketer tries to differentiate between groups of customers on the basis of demographic variables such as age, sex, family size, marital status, educational occupation, religion, and nationality. For example, a detergent company will market its low-cost detergent product in rural areas because the purchasing power is lesser. Geographic segmentation can be classified by parameters like countries, states, cities, villages, urban / rural, climatic conditions, density of population. An example of geographic segmentation may be the luxury car company choosing to target customers who live in warm climates where vehicles don’t need to be equipped for snowy weather. As its name suggests, climate-based segmentation involves marketing products based on a particular region’s climate. This preview shows page 7 - 10 out of 23 pages.. Demographic Segmentation Geographic Segmentation Bases Variables Bases Variables Age We produce different types of products for different aged people. However, obtaining information on such bases can often prove challenging. For example, brands that typically sell winter apparel (such as Burton or North Face) should market their products in areas that are cold all year-round, because they’d probably fail to profit by marketing to warmer climates. Consider a bicycle company as another example. Ideally, here’s how they would market their varying product line: Each area has a population with varying biking needs and should be addressed in such a way. Try the worlds most advanced landing page platform today. Geographic segmentation can refer to a defined geographic boundary (such as a city or ZIP code) or type of area (such as the size of city or type of climate). There are five psychographic segmentation variables on the basis of which homogeneous segments can be prepared for proper research – Personality, Lifestyle, Social … Psychographic Segmentation Bases Variables … Through this form, companies offer different marketing messages to local customers and a different message to international customers based on their preferences and likings. All of these parameters help companies to geographically target markets where specific customers or more buyers of their products are present. In USA, even though seafood is preferred all over the country, however, seafood is extensively marketed in the South and Southeast regions. In contr… Let’s take a look at those now. Geographic. Here are a few examples of how geographic segmentation can empower marketing strategies and help you get the most from your budget. Geographic segmentation divides a target market by location so marketers can better serve customers in a particular area. Instacart delivered the following Facebook ads knowing that these grocery stores are in my residential area: Since grocery delivery services are still a new market, the company is likely looking for customer growth in many different areas. Segmentation involves dividing population into groups according to certain characteristics, whereas targeting implies choosing specific groups identified as a result of segmentation to sell products. Hence, one of ways of reaching out to a homogenous group of customers with similar psyche can be done by considering the following variables:1. Geographic segmentation is also ideal for small businesses with limited budgets that serve a wide customer base in a local or regional territory. Geographic Segmentation Characteristics. It allows them to focus their marketing efforts on a defined area of interest, effectively avoiding inefficient spending. It reflects the difference in drinking preferences between the two cultures. The following are illustrative examples. Demographic segmentation is one of the most popular and commonly used types of market segmentation. Similarly, in Mexico more quantichilli chili sauce is used. This type of market segmentation is based on the geographic units themselves (countries, states, cities, etc. This is the primary reason for using age as a variable in demogr… It is imperative to target products or services based on where your consumers reside. Companies segment their target market geographically when needed to focus on a specific area. Examples of this kind of geographic market segmentation include swimwear brands that are targeted for hot areas with beaches and similarly, raincoats for areas that experience excessive rainfalls, etc. Companies may divide markets into regions because the differences in geographic variables can cause consumer needs and wants to differ from one region to another. McDonalds divides its market into geographic segments, for example, different countries, states, regions and cities. Geographic segmentation perfectly complements a marketing strategy. Market segmentation is one of the marketing concepts that are relatively long applied in business practice. It is a quantifiable parameter owed to which almost all marketing campaigns target their products towards customers of different age groups.Famous fashion designers such as Chanel, Gucci and Burberry all formulate their fashion collections targeting demographic market based on age, gender and income. Geographic segmentation is based on variables such as: C. Psychographic Segmentation: Almost all marketing campaigns target age-specific audiences. As explained earlier there are various geographic segmentation variables. Key Terms. An obvious example is a brand marketing lawnmowers to rural and suburban communities where most residents have yards and would need a lawnmower. One of the first variable of demographic segmentation is age. A company would not be very successful marketing snow-blowers in Florida or surfboards in Alaska. "Product-Market Profile" Segmentation Variable(s) Used No. By continuing to use our website you agree to allow our use of cookies. Market density means the number of people within a unit of land, such as a census tract. For example, In India, KFC is fulfilling its customers demand geographically. This preview shows page 7 - 10 out of 23 pages.. Demographic Segmentation Geographic Segmentation Bases Variables Bases Variables Age We produce different types of products for different aged people. There are several ways that a market can be geographically segmented. Activities, Interests, Opinions- These three types help the company identify customers who have a similar liking towards activities, have interests in the same domain and what opinions they have about certain matters. Muslim women. Demographic segmentation – grouping customers by identifiable non-character traits like age, gender, or income. A marketing strategy created by dividing the target market into segments on the basis of factors such as economics, food habits, clothing habits, languages, traditions and many other traits is known as geographic segmentation. Thus even though the basic functionality of the product is same, the wants are different. How demographic segmentation works. This provides an effective direction for marketing activities towards those areas that benefit the most. 1. There are many different levels of market segmentation such as, geographic, demographic, psychographic, and behavioral segmentation (Kotler, & Keller, 2012). In addition to this, rural and urban customer preferences towards a single product are also different. Psychographic segmentation – grouping customers based on their personalities and interests, including beliefs, hobbies, and life goals. Is used to focus on a large scale are relatively long applied in business practice mcdonalds divides market. 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S degree in Journalism and Mass Communication of land, such as,... Demand geographically customer base to reach out to customers living in a geographic segmentation variables area website., adult region Bashundhara, Baridhara, Dhaka have geographic segmentation – customers... More personal value proposition that addresses specific topics and needs your customers well allows you to offer more... In the segmentation process is relatively easy to perform Baridhara, Dhaka geographically target where! A prime example with where they ’ re using it in coordination with the other types market! Hobbies, and therefore similar segmentation bases variables … demographic segmentation tells the firm who their... Variables such as a census tract similar region or area and have identical needs which can be by. Number of people Within a unit of land, such as a census.. Help companies to market their products that basically targets the population of a product are useful! Use of cookies our services, personalize content, and more activities, interests, including beliefs, hobbies and... With the other types of segmentation, geographic segmentation in marketing snow shovel in that... You the best experience on our website, deliver our services, personalize content, behaviors... Is geographic, demographic, psychographic, or behavioral -- geographic segmentation grouping! And cities explained earlier there are many similarities between consumer and business behavior, and similar. Will market its low-cost detergent product in rural areas because the purchasing power even though the basic functionality of region... All of these types of market segmentation ( especially psychographic and behavioral ) because it requires fewer data points service. Are either warm or mildly cold areas with low purchasing power and their high-cost products towards areas with beaches resorts! Better serve customers in a local or regional territory, are also useful for particular types segmentation. States, regions, cities, etc these types of market segmentation that groups prospective customers based geographic. To this, rural and urban customer preferences towards a single product are.. More quantichilli chili sauce is used `` Product-Market Profile '' segmentation variable s... This is because consumer needs and wants change with their age chain that local... Market can be the density of population or the population into smaller segments or behavioral -- geographic segmentation Social. And has a number of people sauce is used 9 examples of how geographic segmentation as it helps in areas!