Product-Specific Observable Bases: Response-Based Segmentation

The applications of market segmentation discussed in the preceding chapters are based on the assumption that values, lifestyles and geo-demographic profiles are associated with consumer behavior. That assumption is crucial if the segments identified on the basis of those variables are to differ in their response to the marketing mix, thus enabling managers to target specific marketing strategies to chosen segments. In this chapter we review applications in which segments are formed directly on the basis of consumer preferences and their response to price and sales promotions.