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Episode 101: How to Use Market Segmentation: Developing a Target Market

982 ratings | 141323 views
Go Premium for only $9.99 a year and access exclusive ad-free videos from Alanis Business Academy. Click here for a 14 day free trial: http://bit.ly/1Iervwb To learn how Matt creates videos like this one, go here: http://bit.ly/1CQXEJl View additional videos from Alanis Business Academy and interact with us on our social media pages: YouTube Channel: http://bit.ly/1kkvZoO Website: http://bit.ly/1ccT2QA Facebook: http://on.fb.me/1cpuBhW Twitter: http://bit.ly/1bY2WFA Google+: http://bit.ly/1kX7s6P Market segmentation is a commonly utilized concept in business where a larger market of consumers is divided into smaller groups of consumers who share certain characteristics. The goal is to generate what is known as a target market, which is an identifiable group of consumers who behave in a similar way, have similar interests, and share similar characteristics. Firms utilize demographic, geographic, psychographic, and behavioral segmentation as a way of generating a target market. In this updated video on market segmentation we discuss the target market as wel as explain how firms use market segmentation to generate a target market. If you have any questions after viewing the video please post them in the comment box below and I'll do my best to answer them as soon as I can. Thanks for watching!
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Text Comments (148)
Taibi Saad (1 day ago)
Tricia Lynch (9 days ago)
This information is very useful thank you.
Mandy Blanks (1 month ago)
mokube batholomew (1 month ago)
Very helpful thanks keep up the good work
Melitta Holland (1 month ago)
Just a note to the author/speaker. Solar panels work BETTER in areas that don't get too much sun such as Portland and Seattle than they do in especially hot sunny areas, where the panels overheat and break down quickly. Just thought you'd like to know....
That's interesting. Thanks for sharing.
Bálint Kőszegi (2 months ago)
What is the _real_ difference between Psychographic Segmentation and Behavioral Segmentation? I mean, your explanation is clear, if you can measure or observe, then its a behavior. I agree with this. But many other courses or articles putting 'attitudes' 'knowledge' or even 'values' into behavioral box. The other confusing thing is that we can extrapolate behavioral data into some psychometric construct. Eg. the frequency of switching sites (behavior) maybe correlates with impulsivity (personality trait). So...i don't get the logic behind this terminology. here is the same question on Quora if somebody wants to answer it. https://www.quora.com/unanswered/What-is-the-difference-between-Psychographic-Segmentation-and-Behavioral-Segmentation-terminology-is-just-totally-inconsistent-IMHO
Vikas Kumar Tyagi (2 months ago)
Bruna Nesello (6 months ago)
Thank you so much for you time and for sharing your knowledge. I`m an International Business`s student and I`m watching videos to remember what I learned in college... Your videos are amazing. I`m learning and remembering so much. Thank you once more. :)
Nsondo Hamulondo (7 months ago)
Good presentation
Study Account (8 months ago)
really helped and interesting thanks
Adil Umrani (1 year ago)
i couldn't understand, The Demographic . Can you give me more Example?
Lisa R (1 year ago)
I love the way you explain things. So easy to understand! Thanks!
Shubham Srivastav (1 year ago)
sir what is the diffrence between psychographic segmentation and behavioural segmentation please elaborate
xXKatMonXx (1 year ago)
Is there an order in doing Market Segmentation??
john smith (1 year ago)
To the person doing the lecture video for Alanis Business Academy. Are you an entrepreneur?
Cornell Benson (1 year ago)
Great Content!
Tausif Mulla (1 year ago)
I am a marketing lecturer and I like the way you explain the concepts. May I know what software do you use to make these videos? And do you use Apple Pencil for writing these notes?
Sergei Dimitrov (1 year ago)
lanster37 (1 year ago)
Thank you for the vids. What a great vid recaps to watch. I love your voice! Very engaging. Keep up the great work.
William Campbell (1 year ago)
Great work! Well done thanks!! Keep it up bro
Priscilla Knight (1 year ago)
Great information and explanation! Your video really put things in perspective for me.
Esperto Business Plan (1 year ago)
Grat video, simple but complete!
fabian bothen (1 year ago)
Awesome presentation. I was wondering if you may do, or if its already exist a presentation that is focusing on market segmentation and target marketing business to business as well! :)
COREY T. ROGERS (2 years ago)
I wonder if most of the viewers realize that this information is GOLD!
tinacraigen (2 years ago)
I love you
Glad I could help! Take care.
Ali Zangeneh (2 years ago)
Thank you! I found this very helpful and useful!
That's great! Thanks for watching.
Abhishek Ganotra (2 years ago)
Thanks for explaining this .. :) Helped me prepare for an exam. You got one more like added.
Abhishek Ganotra (2 years ago)
certainly did ... I got this exact question to which I replied exactly the same 😂
Glad I could help! Hope you did well on your exam!
Jones2222100 (2 years ago)
Thank you
Ruby Ramelize (2 years ago)
this is very useful, I have a project at uni message : becoming healthier client: 25-30 years old Target Audience Achievers (Vals) Advertisement: Entertainment & media I am focusing on helping people of this age group increase physical health, any advise when it comes to advertisement or research
Luis Mendoza (3 years ago)
Hello there, first of all, thanks for the video. Secondly, how do I cross data using a chart with more than 2 variables. Let's say that I have the percentage of the population that I want to target according to their age and also the percentage of the population that I want to target according to their income, how do I do to put that in to a graphic to see what's the behaviour of the population according to those two variables?, can I add as many variables as a I wish?
ThePastaGuy (3 years ago)
Your video help my so much,thank you a lot !!!
mokauroots (3 years ago)
Bro this is awesome! Really! Im gonna go premium. Thank you :)
Linda Veinberga (3 years ago)
Amazing presentation! You helped a lot for my exam preparation. Aiming for an A after this! ;)
+Linda Veinberga Thank you! Good luck on your exam!
Ladi Akinbobola (3 years ago)
Good presentation but I still need some clarification. Regarding the target market, do u select one of the segments (i.e geographic, demographics etc) as your target market or do you select a target market with a combination of characteristic/variables that fall under all the segments if necessary. E.g Target Market being : A male (gender) of 35 yrs and above (age) living in Florida (location) with an annual income of $50,000 (income) who loves going on boat cruises (lifestyle). As you can see, the target market is a combination of gender (demographic) + age (demographic) + location (geographic) + income (demographic) + lifestyle (psychographic). Am I making any sense?
+Ladi Akinbobola I think I understand what you're saying. There's this interesting dynamic with developing a solid target market. On one hand you want to develop a narrow enough market so that you can develop more interested products for those individuals. On the other hand, you can't over-segment the market to where not enough people are included in your market. This will of course affect profitability. To answer your question more specifically, you're welcome to use any combination of characteristics as long as your customer shares those characteristics. Hope this helps!
Padraig O' Callaghan (3 years ago)
Thanks for the video it really helped explain things.
Alfred Eng (3 years ago)
Thanks alot man
Debby Mac (3 years ago)
Hiya great video helped me understand a lot. I am a little confused on something, do businesses have to do market research or use market research companies to find out information for example if I wanted to use psychographic segmentation would a company have to use market research to find people interested in the same things?- if that makes sense? thank you in advance :)
+Alanis Business Academy If you already have existing customers collecting information on purchasing habits and conducting surveys can also be helpful for building a more complete customer profile. Hopefully all this makes sense. Let me know if you have any other questions.
+Debby Mac That's a really good question. Companies commonly pay outside firms to do market research. However there is a wealth of information available that has already been collected by existing firms. For example, the book "Best Customer: Demographics of Consumer Demand" provides information in the customer for various products and services. The Claritas Prizm (http://www.claritas.com/MyBestSegments/Default.jsp?ID=20&menuOption=ziplookup&pageName=ZIP%2BCode%2BLookup) is also a helpful tool for determine the lifestyles, interests, etc of an area.
john i (3 years ago)
great presentation, I need a segment of your brain lol  (terrible joke)
+john i Glad you enjoyed the presentation. I thought the joke funny!
thfilmaker (3 years ago)
These video's were very help for me while I studied for my Marketing CLEP. I was wondering if you could upload a video on elasticity & inelasticity. Great job and please keep up the good work!
+thfilmaker Thank you! I do have a video available in price elasticity: https://www.youtube.com/watch?v=2WktyYcdA7o. I hope you find it helpful and please subscribe if you haven't already. Thanks!
Makky21 (3 years ago)
Your real-world examples are fantastic. THANK YOU!
+makky21 I'm glad that you liked the examples! Thanks for watching and please subscribe if you haven't already.
Merinda Ramage (3 years ago)
Great video- quick question what program do you use to make your videos? It was a new and interesting way to learn fro me.How can you  write your notes and record your voice and then upload as a video? thanks :)
+Merinda Ramage Thank you Merinda! I'm using Screenflow to capture the recording, Sketchbook Express to display the writing, and a Wacom Bamboo Tablet to perform the writing. Altogether probably around $220 worth of equipment/software. I have an entire course on Udemy that teaches students how to create videos exactly like this one. If you're interested, I've posted a link here: http://bit.ly/1CQXEJl Thanks for watching!
Corinthean Keen (3 years ago)
Great way to simplify the concept.
+Corinthean Keen Thank you Corinthean!
Orlokk Noxx (4 years ago)
Harley Davidson is very famous for this - they justify their price by telling consumers they are "buying into a life style". They will emphasize freedom and individual power to the consumer and famously associate their product with "rebellion". Another great company to sell similarly is the retail chain, Hot Topic. By focusing on a specific type of consumer as the primary audience, a team can tailor their approach completely. This is sometimes called the "rifle approach" because of how exact it is.  The opposite is the "shotgun approach" which intends to hit the most amount in the largest area. A shotgun blast is very disruptive and destructive to not only what it hits, but what was around the radius of impact. This is why it's called a shotgun approach.
Ashish Madkaikar (4 years ago)
very nice, subscribed and shared - thank you so much.
+Ashish Madkaikar I really appreciate that! 
Marijn de Jong (4 years ago)
Thank you a lot, now studying International Business Studies my Unit 3 is about segmentation. And I didn't know any thing about that, now I understand.
+Marijn de Jong Glad I could help! Good luck studying international business!
Superior Cvs Ireland (4 years ago)
Hey man these tutorials really helped me coming up to exam time , any chance you do do one on consumer behaviour and seo for a company website ,
+fiach999 Thank you very much. The closest video to consumer behavior is the consumer buying process, which is episode 102. Good luck!
matthew davies (4 years ago)
I dont normally comment, this was great! Thanks 
+matthew davies Thank you for taking the time to share that matthew. Good luck in the future. 
Dakotababyxx (4 years ago)
thank you this was so helpful!! 
+Dakotababyxx You're welcome! Glad you enjoyed it. 
How do you define your target market? Discover how market segmentation can help you better describe your ideal customer. http://buff.ly/1GtrR0N
Learn how to establish your target market through market segmentation in this lesson: http://buff.ly/1vL1qyN #AlanisBusiness
Learn how to establish your target market through market segmentation in this lesson: http://buff.ly/1EHqsmn #AlanisBusiness
Garry Bryant (4 years ago)
Thank you I enjoyed your presentation.
+Garry Bryant I'm glad to hear that! Thanks for watching. 
Bruce Lee (4 years ago)
very clear explanation, thank you:)
+Habibullo Yusupov You're very welcome! Thanks for watching. 
Manpreet Kaur (4 years ago)
how would you apply this theory to a non-profit organisation seeking to do a campaign using only social media.
chryssoulable (4 years ago)
Thank you.You've got a great teaching style. :)
sixpence319 (4 years ago)
Can you do another video please to see how market STP (Segmentation, Targeting and Positioning) is all integrated into one. And another are of the 4C's.  Thanks in advance.  Your videos are excellent.  I think you did an excellent job especially when it's coming from someone (me) who knows almost to nothing about marketing. Thanks. Ciao!
Haleem AH (4 years ago)
You're very welcome Haleem! Don't forgot to subscribe so you receive updates when I have new content. 
Joseph Ajanth Rajan (4 years ago)
Im building my business plan. Your video helped me lot. Thanks.
Good for you! Best of luck Raja!
Renyu Jin (4 years ago)
ohhh what a good lecture! Your videos helped me a lot!! Thank you so much!! Hope i can get good score next week! ^^
Glad I could help Renyu Jin! Good luck on your exam next week. Let us know how it goes. 
Xuhao Fan (4 years ago)
thanx man, very specific and clear, just wat i need.
You're welcome Xuhao. Best of luck to you. 
Magomedova Medeya (4 years ago)
Appreciate it +Magomedova Medeya!
Grace Ting (4 years ago)
Thank you! Your video is really useful. I was wondering what is the geodemogrphic segmentation? Could you explain it, thanks!:)
Sugandha Chagti (4 years ago)
Hey, video was of great help. Could u also explain marketing factor segmentation as a basis for seg.  Thanks!
Thank you +Sugandha Chagti. Although I'm not sure what you're referring to by marketing factor segmentation. Do you mean market segmentation? Perhaps I missed that in marketing class.
Jimmer Da Rimmer (4 years ago)
Doing a case study on market segmentation and this video helped so much, you sir are my hero.
Glad I could help +Clembo Peeps.
Vickie Steinhoff (4 years ago)
thank you, I am a graduate student in NPO leadership and Management writing a paper and this video helped me understand the information better than the reading materials. Thank you for posting
You're very welcome +Vickie Steinhoff. Good luck writing your paper.
Saulius1927 (4 years ago)
nice video thanks
Thank you +Saulius1927
William Kayo (4 years ago)
Best explanation, thanks 
Thank you! Glad I could help. 
nana sabrina (4 years ago)
this is wonderful. it helped me to help my students better understand the concept..thanks, I appreciate it! students should watch this.
Glad to hear it was helpful! Thanks for watching, and the kind comment. 
suliman elzoway (4 years ago)
nice lecture, i like management and i hope someday study it
I appreciate that. Management is a very interesting topic. Good luck with your studies.
Patrice Thomas (5 years ago)
Great explanation and examples. I really grasped what each segment is used for. Thanks!
Glad to hear that! Thanks Patrice. 
Clint Stockton (5 years ago)
Based on emerging global markets, where do you feel we need to focus our energy and resources at the segmentation level?
That's an interesting question Clint. With the standard of living in many emerging markets rising, they countries represent viable opportunities. Although we've seen many emerging markets showing signs of cooling now that the U.S. federal reserve has begun tapering its bond buying. What you focus on should really transcend segmentation variables and focus on the unique wants and needs of local consumers.  I don't know if that's what you were looking for, but I hope it helps nonetheless. Take care. 
Shady (5 years ago)
Thank you for sharing your knowledge with everyone.  I have one question, why isn't value based segmentation included? I think it is one of the most important types of segmentation out there.
You're welcome. Value based segmentation is important, however isn't a topic that I cover in my intro to business class. That's the only reason why it wasn't included in this video.
mohamed elbery (5 years ago)
great one its simple and easy but if it had more examples it will wonderful
Thanks Mohamed. I agree that more examples are always better. 
kaosy ezeani (5 years ago)
This helped me a lot, God bless!
You're welcome! God bless. 
Saveyoursoul VEVO (5 years ago)
good lecturing math.
Saveyoursoul VEVO (5 years ago)
i will be coming someday soon and i will let you know when am intown sir. thanks for the offer.
You're too kind. If your ever in California during the semester let me know. 
Saveyoursoul VEVO (5 years ago)
would love to attend one of your class session with you sir.
Thank you!
William (5 years ago)
Great Video! have a 15 min presentation due on market segmentation and this left me so much more to discuss than just basic segmentation on income, ethnicity, and education. It's funny how you do not even have to be face to face to teach better than some of my professors who just ramble on and on.
Thanks William! I'm glad that I could help. Good luck with your presentation. 
chirag patil (5 years ago)
thanks a lots...examples given by are very practical and understanding...
That was my hope Chirag so thank you for the feedback.
You're very welcome. Good luck Pruthvi!
I'll give it a shot. Behavioral variables focus on how customers actually behavior towards products. These includes things such as usage rates, brand loyalty, or even the benefits that are being sought. With psychographic variables your focusing on things like lifestyle and interests, which tend to be good predictors of future purchasing behavior. For example, if I'm married with kids I may receive vacation offers or advertisements for mini-vans due to my lifestyle.
Sirinuch Boonthong (5 years ago)
Could u help me to explain more how different between behavior and phychographic segmentation?? thank you in advance !!
Deon Van Heerden (5 years ago)
Market Segmentation what is the measurable, large enough, accessible, actionable and differentiable
Glad I could help Harrison! Good luck with your consulting interview. I've received a couple of requests on the value chain so I may have to revisit that concept. Thanks for the suggestion.
Harrison Okkay (5 years ago)
subscribed! watched ur 4p's swot, porter 5, and a bunch more to help me prepare for my consulting interview your videos are the best :) could i request to do value chain next? on how to create value though its internal operations and processes? thank you again
You're welcome!
Abhishek Iyer (5 years ago)
Thanks. Very informative :)
You're welcome Shubhrans.
You're welcome Ruchi.
shubhrans kukreti (5 years ago)
thank you very much clearly expained
ruchi pande (5 years ago)
Thnx a ton for the videos....they are a gr8 help fr me as i cannot devote much time to books, just by watching your videos i get a gr8 deal of help in the subject. thnx a lot.
You are most welcome.
thanx for d guidance
You're welcome! Thanks for watching.
Thor H (5 years ago)
great stuff. Thanks for posting these videos :)

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