There are various variables to define market segments; however it is only the demographics, geographic, psychographics and behavioral segmentation that will be dealt with.
Demographic Segmentation.
The demographic segmentation divides customers into segments based on demographic values such as age, gender, family size, family life cycle, income, occupation, education, religion, race, generation, social class and nationality (Armstrong and Kotler, 2005:187).
The demographic segmentation is often used in market segmentation for the reason that the variables are easy to identify and measure. Furthermore the demographic variables are associated with sale of many products and services and finally they provide a description of the target customers so media buyers and others can target a desired target market. Each of the variable are useful knowledge when segmenting markets and some of the above mentioned variables will be elaborated in the following (Gunter and Furnham, 1992: 9).
Age and Life-Cycle Segmentation.
The consumer's needs and wants change with age. Therefore some companies use age and life-cycle segmentation, where age and the life-cycle determine the marketing approach. Using telephones (landline and mobile) as an example the marketers must take into consideration that although some 70-years-old use a landline telephone, e.g. due to the lack of technological knowledge, others may only use a mobile telephone. Thus, marketers using the age and life-cycle segmentation must be careful to guard against stereotypes. (Armstrong and Kotler, 2005: 188) Furthermore the age and life-cycle segmentation are associated with behavioral characteristics and buying patterns. An example of this is single people who have a tendency of purchasing new fashionable items due to the fact that they have no other economic obligations. This is opposed to married people, who have a large economic obligation and thereby they prioritize their economy different (Gunter and Furnham, 1992: 11).