Demographic Segmentation

Demographic segmentation divides the market into groups based on variables such as age, gender, family size, family life cycle, income, occupation, education, religion, race, and nationality. Demographic factors are the most popular bases for segmenting customer groups. One reason is that consumer needs, wants, and usage rates often vary closely with demographic variables. Another is that demographic variables are easier to measure than most other types of variables. Even when market segments are first defined using other bases, such as benefits sought or behavior, their demographic characteristics must be known in order to assess the size of the target market and to reach it efficiently.

Age and Life-Cycle Stage. Consumer needs and wants change with age. Some companies use age and life-cycle segmentation, offering different products or using different marketing approaches for different age and life-cycle groups. For example, McDonald's targets children, teens, adults, and seniors with different ads and media. Its ads to teens feature dance-beat music, adventure, and fast-paced cutting from scene to scene; ads to seniors are softer and more sentimental. Procter & Gamble boldly targets its Oil of Olay ProVital Series subbrand at women over 50 years of age. It's "specially designed to meet the increased moisturization needs of more mature skin.'' 8

Sega, the computer games giant, which has typically focused on the teen market, is now targeting older customers. According to a Sega licensing executive, Sega's core market of 10- to 18-year-olds "sit in their bedrooms playing games for hours." Then, however, "they turn 18 and discover girls ... and the computer gets locked away." To retain these young customers as they move into new life-cycle stages, Sega is launching a range of products for adults under its Sega Sports brand, including clothing, shoes, watches, and sports equipment such as Sega Sports-branded footballs and basketballs. 9

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