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Erica Wellman October 12, 2010 Marketing 3000-Miller Mid Term Paper

Demographic Segmentation Marketing Segmentation is a way companies can categorize and define large markets into smaller, more targeted markets. Market Segmentation involves variables under groups such as geographic, demographic, psychographic, and behavioral segments. I chose to focus more on Demographic segmentation. Demographic segmentation is defined as “dividing the market into groups based on variables such as age, gender, family size, family life cycle, income, occupation, education, religion, race, generation, and nationality” (Kotler & Armstrong, 2010, p. 194). When looking at a personal situation I focused on a particular business and looked at the type of demographic it attracts. This particular business is the one I work at which is, the Tavern in the Denver Tech Center. The Tavern is a bar and restaurant that has a variety of locations. I believe that each location attracts a certain demographic. I realize that a huge reason why that is, is because of the geographical location of each Tavern, however I think that individually the restaurants know their target demographic therefore they know who to market to, which in turn attracts that particular demographic. The people that come into the Tavern DTC can address many of the characteristics of the demographic segmentation. First, if we look at age, the Tavern is a bar therefore the type of market we attract are people who are over 21 years old and can legally drink. The Denver Tech Center is a predominately business oriented area, there for the age of people that come in are generally older like 25+. This correlates with another characteristic of the Tavern DTC’s demographic. The occupations of people that enter the bar are usually corporate or office related. If we look at the gender, I tend to see more males than females come into the Tavern. I think that this is because the females that live in that are usually with their families rather than attending bars for happy hour and such. Understanding the type of demographic your market is, will help you better promote your business or product. “In a multi-dimensional market, companies can increase, profitability by utilizing market segmentation” (Lin, 2002, p. 250). Looking at the Tavern DTC I have noticed certain promotions we offer that best interests our market. For example, being a bar, we offer football specials on beer, pizza, and wings, which are very profitable considering our gender demographic consist of mostly males. We also offer a Mother’s Day and Easter brunch which targets couples and families. Once again, the variable of age demonstrated here because you don’t see the Tavern located downtown offering elegant


brunches simply because that would not be conducive to the downtown’s demographic. I have also experienced that by understanding the targeted demographic ,the Tavern DTC is able to attempt to expand their target market by offering something like Ladies Night on Thursdays to attract a different demographic. This is an attempt to reach the younger and low income demographic, because ladies drink free. Market Segmentation is a way to better understand and differentiate the market you are targeting. Demographic segmentation is a large category in which a business can better understand the type of people that are, or you want to attract. Once your target demographic and market is identified you have a better chance of having the largest return on profit because you know, generally what your market is interested in.


References

Chin-Feng Lin, (2002) "Segmenting customer brand preference: demographic or psychographic", Journal of Product & Brand Management, Vol. 11 Iss: 4, pp.249 - 268 Kotler, P., & Armstrong, G. (2010). Principles of marketing. Upper Saddle River, NJ: Pearson Education.


demographic segmentation