The marketer may even use product related basis for segmenting his or her market .One of the important basis is the product ‘use situations’. Different customers may use the same product in different ‘use situations’. Rasna, for example is shown as being used in different situations like a party, for unexpected guests, a drink at the end of a long and tiring work day, etc. A marketer tries to make the product versatile so that it can be used in different situations. But the customers may use different products and brands for different situations. For instance, a customer may buy a sports watch for sporting activities and may buy a jeweled watch for a party. Thus depending on the use situations, a product or a brand may be selected by the customer. Knowing these situations help the marketer plan the positioning strategy.
Another commonly used product related variable is the benefits segmentation. Here, the marketer identifies benefits that a customer looks for when buying a product. This has been a very effective method of segmenting the market for watches, where a customer may buy one for just knowing the time, or for durability ,or as a gift/an accessory/a dress item/a jewellery item .In each case ,the customer need is different. And using this basis, the erstwhile market leader in the watches market, HMT, claimed in its promotion that if you (i.e. the customer) have the inclination, we have the time. Titan in one of its commercials reminds the woman that the next time a man thinks of a gift for you, ask for Titan. Customers look for different benefits .Some want intangible benefits while others look for tangible ones. Looking attractive and pretty is very important to a woman when she buys dresses or cosmetics .Hence, Garden Vareli used this intangible psychological benefit to segment its market
The quantity consumed at any given time has also been the basis for segmenting the beverages (tea, coffee), soft drinks, breweries, and cigarette markets. Accordingly, the following market segments are visible.
The differentiation between them is based on the benchmark quantity defined by the marketer for each segment.
Competition Based Segmentation
An important indicator of marketing success of an enterprise is the number of its loyal customers. Customer loyalty, therefore, is an important index to determine the competitive position of the firm. This is also used as the basis for segmenting the market and evolving the marketing strategy for each segment and also to encourage customer loyalty. Based on loyalty, we can again have the following segments.
Hard Core Loyalist
Hard core loyalists are those customers who continue to buy the same brand over and over again. The test here is whether the customer would refuse the competing brand, if and when offered, and insist on buying his own preferred brand? Newspaper readers, cigarette smokers, and tea drinkers are some customer groups where such intense loyalties are commonly visible.
Soft Core Loyalist
Those who are loyal to two or three brands in a product group are called soft core loyalists .For example, a housewife who buys Lux, Lux, Lux, Cinthol, Cinthol and Pears, Pears, Lux in her nine shopping expeditions will be considered as a soft core loyal. The marketer needs to watch such customers and motivate them to shift to the hard core loyalty segment.
Switchers are those customers who never stick to a brand. These are the customers for whom brand switching is as easy as changing a shirt. They may switch for a variety or for a special deal. In either case, this is a very slipping market segment for the marketer .The firm needs to examine why it is losing its customers to competitor brands .This can help to strengthen its competitive position in the market.
While using the loyalty index to segment the market, a firm should however, be careful. For, what on the face may appear to be loyalty may in effect be a behavior caused by indifference, habit, non-availability of competing brands or low price. The marketer should examine these factors carefully and see if any of them is a factor determining customer loyalty.