This article explains the 3 basic types of market segmentation: Demographic Segmentation, geographic segmentation, and psychographic. It also demonstrates Target Market Segmentation Theories- Maslow’s Hierarchy and VALS Segmentation Model in Consumer Behavior.

Demographic Geographic Psychographic

Demographic, Geographic, and Psychographic segmentation refers to the market segmentation technique based on the different factors related to the audience. These are the most effective strategies for dividing people into identical subgroups. The purpose of demographic, geographic, and psychographic segmentation is to segment audiences into subgroups to inform political campaigns, commercial marketing, and advertising.

Market Segmentation

Market segmentation separates people into similar subgroups based on geographic, demographic, and psychographic factors. It is an essential process for social, political, and commercial campaigns and advertising. It is an effective way to send messages to a targeted group rather than to everyone.  A long time ago, audience segmentation was primarily applied for social and political campaigns. Currently, it is widely used in market segmentation. Therefore, audience segmentation is known as market segmentation.

Market Segmentation Examples

For example, a political leader is campaigning, urging voters to support his party. Thus, the leader targets voters solely to conduct the campaign. In many countries worldwide, the minimum voting age is 18 years. For example, in the USA, citizens aged 18 or older. The political leader persuades the citizens of the constituency to adopt an age minimum of 18 years. Here, a citizen of the constituency refers to the inhabitant of a particular area, which is also an example of a geographic factor of market segmentation. Similarly, age is a demographic characteristic of market segmentation.

Demographic Geographic Psychographic Diagram

Types of Market Segmentation

The 3 Types of Market Segmentation are

1. Demographic Segmentation
2. Geographic Segmentation
3. Psychographic Segmentation

1. Demographic Segmentation

Demographic segmentation refers to the process of grouping individuals into similar subgroups based on demographic characteristics such as age, gender, ethnicity, education, religion, socioeconomic status, and group membership.

For example, a political organization divides people by age. They are looking for voters whose age is more than 18 years. It is an example of demographic segmentation. Demographic questionnaires are crucial to conducting surveys and market research.

Demographic Factors

Demographic factors are characteristics of audiences, such as age, gender, ethnicity, education, and religion.

The demographic segmentation factors are Age, Gender, Ethnicity, Education, Religion, Economic status, Experience, Group Member, Nationality, Marital Status, Employment Status, Family Status, and Living Status.

Examples of Demographics in Marketing

2. Geographic Segmentation

Geographic segmentation refers to grouping individuals into similar subgroups based on geographic factors such as residence, climate, and population. It highlights the audience’s location and environment.

Geographic Factors

The Geographic Factors are Place of residence, Season climate, and Population.

1. Place of Residence

Place of residence refers to rural or urban areas where the audience lives, whether permanently or temporarily. People in urban and rural areas differ in their lifestyles, including dress, appearance, and attitudes. Therefore, market segmentation is essential before starting an advertising or social campaign.

 2. Season and Climate

Season refers to a specific period of the year characterized by a particular climate. For example, the United States has four seasons: Autumn, Spring, Summer, and Winter.

For example, Ice cream companies earn more money in the summer season than in winter. In contrast, the blanket-selling company focuses its marketing on the winter season. The company needs to focus on geographic segmentation for the advertising campaigns.

3. Population

Population means the inhabitants of a particular area; for example, the capital city, metropolitan city, or small town. However, they share similar characteristics but also differ.

3. Psychographic Segmentation

Psychographic segmentation separates people into similar subgroups based on psychographic factors such as values, beliefs, attitudes, and behaviors. These factors indicate individuals’ internal psychological characteristics.

Psychographic Factors

The four psychographic factors of market segmentation are values, beliefs, attitudes, and behaviors; these four factors help explain how audiences feel and behave.

For example, a political leader’s values, beliefs, attitudes, and behaviors are clearly distinct from those of a physician.

 1. Values

Firstly, values are judgments about what is right or wrong, desirable or undesirable. For example, most people share equality, freedom, honesty, fairness, justice, good health, and family. Another example, we respect human life naturally (Value).

2. Beliefs

Secondly, a belief is something you accept as true, and it is stated as a declarative sentence. For instance, students believe that using the internet improves the quality of their research. Furthermore, you may feel that giving blood is important because an adequate blood supply is necessary to save a life (Belief).

3. Attitudes

Thirdly, an attitude is a statement expressing an individual’s approval or disapproval, such as liking or disliking. Attitudes typically derive from our values and beliefs. Many values and beliefs interact to complicate our decision-making.  For example, you may feel that giving blood is very important (Attitude).

4. Behaviors

Finally, Behavior is an individual’s observable action. It is the way we act or behave toward others. It is the combination of other psychological factors, such as values, beliefs, and attitudes.

For example, you may feel that giving blood is important (Attitude) because an adequate blood supply is necessary to save a life (Belief) and because you respect human life (Value). Your behavior is a logical and observable extension of your outlook as you participate in the blood drive and donate blood.

Example of Psychographic segmentation

For example, you may feel that giving blood is important (Attitude) because an adequate blood supply is necessary to save a life (Belief) and because you respect human life (Value). Your Behavior, as you participate in the blood drive and donate blood, is a logical and observable extension of your

Advantages and Disadvantages of Psychographic Segmentation

Advantages of Psychographic Segmentation

1. Deeper Understanding of Customers: Psychographic segmentation offers a more comprehensive understanding of customers beyond basic demographic characteristics such as age and income. It helps marketers understand the drivers of consumer behavior, preferences, and purchasing decisions.
2. Targeted Marketing Communications: By segmenting the market based on psychographic variables, marketers can tailor their messaging and communication strategies to resonate with specific consumer segments. This personalized approach enhances the relevance of marketing efforts, resulting in higher engagement and response rates.
3. Enhanced Product Development: Psychographic segmentation enables companies to develop products and services that align with the needs, preferences, and lifestyles of different consumer segments. By catering to the unique desires and aspirations of target customers, companies can create offerings that stand out in the market and generate greater customer satisfaction.
4. Improved Customer Retention: Understanding customers’ psychographic profiles enables companies to build stronger relationships and loyalty. By delivering personalized experiences and addressing customers’ values and interests, companies can foster deeper connections and increase customer retention.
5. Effective Market Positioning: Psychographic segmentation helps companies identify niche markets or segments with distinct needs and preferences. By positioning their products or services to address the specific desires of these segments, companies can differentiate themselves from competitors and gain a competitive advantage in the market.
6. Increased Marketing ROI: Targeting specific psychographic segments allows companies to allocate their marketing resources more efficiently. By focusing efforts on segments most likely to respond positively to their offerings, companies can optimize their marketing ROI and achieve better results with less expenditure.
7. Adaptation to Changing Trends: Psychographic segmentation enables companies to stay attuned to evolving consumer trends, lifestyles, and preferences. By continuously monitoring and analyzing psychographic data, companies can

Disadvantages of Psychographic Segmentation

1. Subjectivity and Interpretation Bias: Psychographic segmentation relies on subjective interpretations of consumer attitudes, values, and behaviors, which can introduce bias into the segmentation process. Different analysts may interpret the same data differently, leading to inconsistent segmentation outcomes.
2. Limited Generalizability: Psychographic segments may not generalize well across markets or demographic groups. Consumer preferences and behaviors can vary widely across cultural, regional, and temporal contexts, making it challenging to apply psychographic insights universally.
3. Complexity in Data Collection: Gathering psychographic data can be more complex and time-consuming compared to demographic or geographic data. It often requires extensive market research, surveys, and analyses to accurately uncover consumers’ attitudes, values, and lifestyles.
4. Overlap Among Segments: Psychographic segments often overlap, making it difficult to create distinct, actionable segments for targeted marketing. Consumers may exhibit characteristics of multiple psychographic segments simultaneously, blurring the boundaries between segments.
5. Privacy Concerns: Collecting and analyzing personal information related to consumers’ attitudes, values, and lifestyles raises privacy concerns. Consumers may be wary of sharing sensitive information, especially in light of data privacy regulations and concerns about data security breaches.

Two Market Segmentation Theories

1. Maslow’s Hierarchy of Psychological Needs theory
2. VALS Segmentation Model in Consumer Behavior

1. Maslow’s Hierarchy of Needs Theory

Maslow (1943) initially stated that individuals must satisfy lower-level deficit needs before meeting higher-level growth needs. It is a well-known content theory of motivation. However, he later clarified that satisfaction of a need is not an “all-or-none” phenomenon, admitting that his earlier statements may have given, for example, “the false impression that a need must be satisfied 100 percent before the next need emerges. According to Maslow’s theory, human needs can be divided into five categories. These are physical, safety, belongings, love, esteem, and self-actualization needs.

Elements of Maslow’s Psychological Needs Theory

1. Physical needs: Physical needs are basic human requirements for livelihood, for example, water, food, rest, warmth, and so on.

2. Safety needs Requirements for security and protection purposes, such as personal security, health security, employment, property, etc.

3. Belongings and love needs: Relationship with people around us for giving and receiving affection, for example, intimacy, friendship, family, and friends.

4. Esteem needs: Refers to self-confidence, self-esteem, and self-respect of humans; for example, everyone has a certain talent, so we need to pat them on the back from time to time for exploring their intellectuality.

5. Self-actualization needs: Refers to self-fulfillment, desiring to become the most that one can be; for example, we need our goals to feel that we have fulfilled our destiny or reached our potential.

2. VALS Segmentation Model in Consumer Behavior

The VALS (Values, Attitudes, and Lifestyles) segmentation model is a widely used framework in consumer behavior research and marketing. Developed by social scientists Arnold Mitchell and S. Robert Horton, the VALS framework categorizes consumers into distinct psychographic segments based on their primary motivations, attitudes, and behavioral patterns. Here’s an overview of the VALS segmentation model:

1. Values: The VALS model identifies two primary dimensions of human values: resources and self-orientation. Resources refer to the extent to which individuals prioritize achieving goals related to self-enhancement or self-transcendence. Self-orientation refers to individuals’ motivations to seek stimulation and variety versus stability and order in their lives.
2. Attitudes: VALS classifies individuals based on their attitudes toward innovation and change, as well as their level of openness to new experiences and ideas. This dimension reflects individuals’ willingness to adopt new products, technologies, or lifestyles.
3. Lifestyles: The VALS model distinguishes between primary and secondary motivations that drive consumer behavior. Primary motivations reflect individuals’ core values and priorities, while secondary motivations are situational or contextual factors that influence behavior in specific circumstances.

Based on these dimensions, the VALS segmentation model identifies eight distinct consumer segments:

Elements of the VALS Segmentation Model

1. Innovators: These consumers are characterized by their high levels of resources, self-confidence, and openness to new ideas and experiences. They are often early adopters of innovative products and technologies.
2. Thinkers: Thinkers value knowledge, education, and intellectual pursuits. Therefore, they tend to be rational and deliberate in their decision-making process, preferring products and brands that align with their values and beliefs.
3. Achievers: Achievers are motivated by success, status, and achievement. They strive for material wealth and social recognition, preferring established brands and products that symbolize success and prestige.
4. Experiencers: Experiencers seek excitement, adventure, and variety in their lives. They are spontaneous, impulsive, and open to new experiences, often seeking out novel and unconventional products and activities.
5. Believers: Believers are traditional, conservative, and value-oriented consumers. Hence, they prioritize security, stability, and family values, preferring established brands and products with a track record of reliability.
6. Strivers: Strivers are ambitious, aspiring individuals who seek to improve their social and economic status. Additionally, they are motivated by success and recognition, often emulating the lifestyles and behaviors of higher-status groups.
7. Makers: Makers are practical, hands-on individuals who value self-sufficiency, craftsmanship, and utility. They also prefer functional, no-frills products that offer value and durability.
8. Survivors: Survivors are cautious, risk-averse consumers who prioritize security, safety, and basic needs. They are typically on fixed incomes or facing financial constraints, preferring low-cost, practical solutions to their needs.

Conclusion

Target market segmentation has become a viral strategy for social, political, and business purposes. People now live in a global village as global citizens due to the widespread accessibility of social media. Therefore, politicians and businesspeople pay greater attention to market segmentation in political campaigns and to social media marketing, such as Facebook, Instagram, Twitter, and YouTube.