Giving fans a personalized fan experience poses a real challenge when fan bases are made up of such a diverse range of demographics. Age, gender, location, behaviour and spending power are just a few factors to consider for sports marketers when creating their campaigns.. Demographic segmentation of a fan base helps marketers target their consumers more accurately, consequently enhancing retention and loyalty. Show So, what is customer segmentation and how can it benefit a sports club? How can segmentation analysis lead to sport marketing strategy? In this article we’ll be looking at the top 5 customer segmentation strategies for the sports industry. Market segmentation is defined as “the process of dividing a market into distinct subsets of consumers with common need or characteristics, and selecting one or more segments to target with a distinct marketing mix” (Schiffman & Kanuk, 2004). Segmenting consumers is an essential task for marketers, in their effort to understand their consumers needs and characteristics, and develop targeted marketing strategies. Market also benefits consumers, as products and services are then designed to satisfy their specific needs. As a result, consumers will receive better quality of services and will realize higher satisfaction levels. There are 3 main steps in the market segmentation process: There are 2 market segmentation methods: 1) a priori, which is generally conceptual and based on past research; 2) and a posteriori, which is data-driven by current research. In the priori method, market groups are formed based on the researcher’s prior knowledge and experience; while in the posteriori method, market groups are formed based on primary research. Cluster analysis is often applied, in the latter case, to identify market groups with common characteristics. The most common segmentation variables are: demographic (e.g. age, gender etc), geographic, behavioral (e.g. frequency and quantity of purchases) and psychographic (e.g. attitudes, benefits, motivation and personality). A combination of various market segmentation variables can also be used. For instance by combining demographic and behavioral variables one could obtain a clearer picture of a consumer. Gender SegmentationGender is one of the most common variables used for market segmentation. In the sport
marketing context, an interesting development has been the growing consumer power of females. Globally, it has recently been estimated that women control $28 trillion in consumer spending and more than 70% of all consumer-related decisions (Silverstein & Sayre, 2009). As a result, the majority of sport sectors are now invested in the female consumer market. Some relevant examples of this investment include female athletic gear (e.g. shoes and clothing), female health clubs,
female fitness programs, and female sports leagues. Nike, for example, predicted that its line of athletic gear for women will have added $2 billion to annual sales by 2017 (and they were right!).
In addition, on recognising the economic benefits of the female market, the NFL opened a new website section just for women in 2011 . Similar statistics in relation to the growth of the female sport consumer market have also been reported by other US sport leagues, including:
The list of examples is long and one could keep going forever, but I think you get the point. The proof is in the numbers. Identifying the needs of the female sport consumer is a key topic for further developing the female sport market. Previous marketing approaches that have solely defined female sport consumers through family relationships (e.g. watching sport because the husband or son does, or attending the game to spend time with family) are no longer appropriate. Women are now viewed as distinct and real sport consumers, whether as fans, active participants, coaches or athletes. Female-affinity clubs, for example, as created by several NFL teams, support this new trend, providing not only educational experiences, but also opportunities for networking, enhanced game experience and women being treated like genuine football fans. Age SegmentationMarket segmentation by age is one of the most important types of segmentation due to the significant difference between the needs and habits of different age groups. Geographic SegmentationIn geographic segmentation, the market is divided according to the location where consumers live, which can be based on regions, cities, or countries. The common perception is that individuals who live in different locations have different opportunities and consumer behaviour patterns, based on the influence of where they live. Geographical segmentation is also often applied when sport organizations select specific communication channels (local vs. national TV channels, radio stations, newspapers, magazines, events, direct mail-outs). Geographic segmentation , for example, is widely used by sport organizations which have a local profile, such as state/public park and recreation departments which target local communities. Sport event organizers also often use geographic segmentation in terms of targeting national or international visitors (participants or spectators). Sport organizations with international profiles (e.g. European professional football teams and NBA teams) often develop specific targeted marketing strategies for the different continents/countries, where their sports are more relevant, to increase their local fanbase. Behavioural SegmentationIn behavioural segmentation the consumer market is divided according to the quantity of product buying, frequency of using a service and brand loyalty. It can be based on simple indicators such as how many games an individual attends per year or how many times members visit a health club per week. It can also be based on a more sophisticated approach, such as using multiple criteria to categorize consumers, according to loyalty levels. Examples of behavioural segmentation variables in sports include the percentage of total games attended per season, the amount of money spent on merchandise per year, the propensity to renew support in successive seasons and the extent to which fans only support the one team. Psychographic SegmentationPsychographic segmentation is probably the most difficult segmentation approach for marketers, as it is generally based on the intrinsic, subjective characteristics of each consumer, such as personal attitudes, interests and
opinions. Psychological constructs such as motivation, attitudes, satisfaction and fan involvement are among the most common used by marketers. What is the process of dividing a heterogeneous market into homogeneous market?As its name suggests, market segmentation is the process of separating a market into sub-groups, in which its members share common characteristics. To meet the most basic criteria of a market segment, three characteristics must be present: there must be homogeneity among the common needs of the segment.
What is the process of dividing a heterogeneous market?In marketing, market segmentation is the process of dividing a broad consumer or business market, normally consisting of existing and potential customers, into sub-groups of consumers (known as segments) based on some type of shared characteristics.
What means dividing the heterogeneous market into homogeneous subgroups?However, the heterogeneous market can be divided into many homogenous customer segments using several variables. This division of the whole market into relatively homogenous groups is called market segmentation.
Is the process of dividing the market into homogeneous parts or groups?Market segmentation is the process of dividing a market of potential customers into groups, or segments, based on different characteristics. The segments created are composed of consumers who will respond similarly to marketing strategies and who share traits such as similar interests, needs, or locations.
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