There are so many different kinds of people with just about each one of them displaying different buying

patterns; Yankelovich introduced the concept of non-demographic market segmentation in 1964. To Yankelovich disappointment, the concept wasnt applied as intended. Unfortunately, according to the authors, market segmentation has become narrowly focused on the needs of advertising which only creates commercials with characters that viewers can relate to. But, if applied properly, market segmentation would guide companies in tailoring their offerings to the segments most likely to purchase them. The article, Rediscovering Market Segmentation, explores how applying segmentation to product, pricing and sales strategy can use customers with similar attributes for a financial and competitive advantage. The Drift into Nebulousness Prior to World War II, consumers were pretty predictable in their buying habits. During this era, there many incredible innovations in consumer products, disposable diapers, disposable razors, good-tasting toothpaste (instead of bad tasting baking soda), etc.). These cool items basically sold themselves. Marketing segmentation was based on narrow demographic traits such as gender, age and family size. According to Kotler and Keller, this is a sector and not a segment. But, the 60's brought many changes; long hair, loud music and unpredictable consumer spending habits. This is when Yankelovich introduced the idea of non-demographic segmentation in his 1964 article, "New Criteria for Market Segmentation. Per Yankelovich's 1964 analysis, We should discard the old, unquestioned assumption that demography is always the best way of looking at markets. This non-demographic segmentation was a way to focus on the differences among customers that matter the most strategically. Yankelovich and Meer, if companies would rediscover 'market segmentations original idea and apply them properly companies would be able to better tailor their offerings to the segments most likely to purchase them. Organizations would better be able to respond quickly and effectively to the ever changing market conditions and be able to develop insights into where and how to compete to gain the maximum benefit from their marketing resources. The main dimensions of the VALS framework are primary motivation (the horizontal dimension) and resources (the vertical dimension). The vertical dimension segments people based on the degree to which they are innovative and have resources such as income, education, self-confidence, intelligence, leadership skills, and energy. The horizontal dimension represents primary motivations and includes three distinct types:

Consumers driven by knowledge and principles are motivated primarily by ideals. These consumers include groups called Thinkers and Believers. Consumers driven by demonstrating success to their peers are motivated primarily by achievement. These consumers include groups referred to as Achievers and Strivers. Consumers driven by a desire for social or physical activity, variety, and risk taking are motivated primarily by self-expression. These consumers include the groups known as Experiencers and Makers.

Psychographic segmentation has been criticized by well-known public opinion analyst and social scientist Daniel Yankelovich, who says psychographics are "very weak" at predicting people's purchases, making it a "very poor" tool for corporate decision-makers. VALS has also been criticized as too culturally specific for international use. The Way Back For those in marketing to stop the drift away the original purpose of market segmentation, Yankelovich and Meer six guidelines. Meaningful segmentation should:

Reflect the company overall strategy; Indicate where sources of revenue or profit may lie; Identify consumer values, attitudes and beliefs as they relate specifically to product or service offerings; Focus on actual customer behaviour. Make sense to top executives; Accommodate or anticipate changes in markets or consumer behaviour.

To segment markets effectively, apply these tactics:

What we are trying? Identify a strategic decision that would benefit from information about different customer segments. For instance, a fast-food company is considering developing healthier menu alternatives. A personal-care company wants to extend a soap brand into deodorants. Determine which customers drive profits. Understand what makes your best customers so profitable, and then identify segments that share at least some of those characteristics. A luggage company finds that many people who buy its highest-margin carry-on bags are international flyers. It thus identifies international travellers as a promising target segment. Which attitudes matter to the buying decision? Analyze actual and potential purchasing behavior. Current behaviours (including heaviness of use, brand switching, and channel selection) can help you predict future behaviors using a statistical technique called conjoint analysis. Through such analysis, you present consumers with combinations of product features and ask them how willing they'd be to purchase the product in question if particular attributes were added or removed, or if the price changed. You then segment based on your findings. A pet food manufacturer used conjoint analysis to determine which features to include on food packaging (such as a resealable opening and a handle on 25-pound bags). It segmented consumers according to their degree of price sensitivity and desire for convenience. It then redesigned its packaging with added features that would maintain existing customers and attract new ones. And it jettisoned features whose cost would have required charging too high an overall price. Segment in ways that make sense to senior management. Resist any urge to flaunt your technical virtuosity by dissecting segments into ever finer slices containing improbable combinations of traits. Instead, define segments in ways that make intuitive sense to senior managers. They'll be more likely to accept your research and to fund resulting initiatives. Revise your segmentation as market conditions change. Unlike personality traits, which usually endure throughout life, consumers' attitudes, needs, and behavior can change quickly with new market conditions, so be willing to redraw your segments to reflect new realities.