Question

A new car manufacturing company is set out to manufacture cars that cater to its high-income customer group. It decides to target those consumer segments that can afford premium and luxurious cars. What segmentation strategy has the company adopted?

Answer 1

The segmentation strategy used by the company is Demographic segmentation. Under demographic segmentation, markets are classified on some demographic features like age of the customers, their gender, their income, their occupation, their religion etc. Here the company is going to manufacture the cars for high income group people. Hence, marketing program is to be made to target only those people with high income who can afford premium and luxurious cars. Hence, the segmentation is demographic.

Other major kinds of market segmentation are geographic segmentation, psychographic segmentation and behavioural segmentation.