Editing Marketing (section)

==Segmentation==
{{main|Market segmentation}}
Market segmentation consists of taking the total heterogeneous market for a product and dividing it into several sub-markets or segments, each of which tends to be homogeneous in all significant aspects.<ref name=":8">{{Cite book|title=Fundamentals of marketing|last=Stanton|first=William J|publisher=McGraw-Hill|year=1984}}</ref> The process is conducted for two main purposes: better allocation of a firm's finite resources and to better serve the more diversified tastes of contemporary consumers. A firm only possesses a certain amount of resources. Thus, it must make choices (and appreciate the related costs) in servicing specific groups of consumers. Moreover, with more diversity in the tastes of modern consumers, firms are noting the benefit of servicing a multiplicity of new markets.

Market segmentation can be defined in terms of the [[Segmenting-targeting-positioning|STP]] acronym, meaning [[Segmenting-targeting-positioning|Segmentation, Targeting, and Positioning]].

'''Segmentation''' involves the initial splitting up of consumers into persons of like needs/wants/tastes. Commonly used criteria include:
* '''Geographic''' (such as a country, region, city, town)
* '''Psychographic''' (e.g. personality traits or lifestyle traits which influence consumer behaviour)
* '''Demographic''' (e.g. age, gender, socio-economic class, education)
*'''Gender'''
*'''Income''' 
*'''Life-Cycle''' (e.g. Baby Boomer, Generation X, Millennial, Generation Z)
*'''Lifestyle''' (e.g. tech savvy, active)
*'''Behavioral''' (e.g. brand loyalty, usage rate)<ref>{{Cite book|title=Marketing: the Basics|last1=Moore|first1=Karl|last2=Pareek|first2=Niketh|publisher=Routledge|year=2010|isbn=978-0-415-77899-2|location=New York, NY|pages=38–65}}</ref>

Once a segment has been identified to target, a firm must ascertain whether the segment is beneficial for them to service. The ''DAMP'' acronym is used as criteria to gauge the viability of a target market. The elements of DAMP are:
* '''Discernable''' – how a segment can be differentiated from other segments.
* '''Accessible''' – how a segment can be accessed via Marketing Communications produced by a firm
* '''Measurable''' – can the segment be quantified and its size determined?
* '''Profitable''' – can a sufficient return on investment be attained from a segment's servicing?

The next step in the targeting process is the level of [[differentiation (economics)|differentiation]] involved in a segment serving. Three modes of differentiation exist, which are commonly applied by firms. These are:
* '''Undifferentiated''' – where a company produces a like product for all of a market segment
* '''Differentiated''' – in which a firm produced slight modifications of a product within a segment
* '''[[Niche market|Niche]]''' – in which an organization forges a product to satisfy a specialized target market

''[[Positioning (marketing)|'''Positioning''']]'' concerns how to position a product in the minds of consumers and inform what attributes differentiate it from the competitor's products. A firm often performs this by producing a perceptual map, which denotes similar products produced in the same industry according to how consumers perceive their price and quality. From a product's placing on the map, a firm would tailor its marketing communications to meld with the product's perception among consumers and its position among competitors' offering.<ref>{{Cite book|title=Strategic Management in Tourism|url=https://archive.org/details/strategicmanagem00mout|url-access=limited|last=Moutinho|first=Luiz|publisher=CABI Publishing|year=2000|location=New York, NY|pages=[https://archive.org/details/strategicmanagem00mout/page/n131 121]–166|isbn=9780851992822}}</ref>