Market Segmentation:

Market segmentation is the process of dividing the market into different segments according
to the tastes and preference of the consumers. There mainly 4 important bases of market
segmentation they are:

y Psychographic segmentation y Behavioral segmentation

1) Psychographic segmentation:
Here the buyers can be divided into groups on the basis of the life style or personality or
values

2) Behavioral segmentation:
Here the buyers can be divided into different groups on the basis of their knowledge of,
attitude towards, use of, or response to a product.

3) Geographical segmentation:
Here the markets are divided into different geographical units as such nations, states,
territories etc,

4) Demographic segmentation:
The market is divided into segments based on the variables such as age, family size, sex,
religion, race, generation and social groups

Reliance fresh should segment the customer on the following basis:

They should identify their strengths, from talking to your customers. Focus on these
strengths ± instead of diversifying into new markets when the existing one matures

They should identify what their customers¶ different needs, wants and motivations are and
how the market segments itself.

They should not try to please everyone ± decide which segments to please make your own
(and which to ignore), then differentiate to target that market.

They should not over-value data. Descriptive data is useful to target Needs- based segments,
but it does not equal good Segmentation on its own.

They should try to identify needs and wants of their customers may not know they have. This
will help them to innovate in the future.

Customers want value not cheapness. μLatent need¶ often masquerades as demand for the
cheapest price.

Target market:
Target Markets: Although retailers normally aim at the mass market, a growing number are
engaging in marketing research and market segmentation, because they are finding it
increasingly difficult to satisfy everyone. Through a careful definition of target markets,
retailers can use their resources and capabilities to position themselves more effectively and
achieve differential advantage. The tremendous growth in number of speciality stores in
recent years is largely due to their ability to define precisely the type of customers, they want
to serve.

In order to generate revenue reliance fresh should target house makers since they are the one
purchase the goods for the house so they will be the frequent visitor also

Older shoppers and Generation X consumers hold the key to survival for stores like reliance
fresh and independent outlets, says a research

A new survey points out the two groups are natural markets for small operations to target in
order to survive an increasingly competitive industry

In order to survive the price competition from the mega giants in the retail business, Reliance
fresh must stress target marketing and customer service.

Reliance fresh should target older shoppers and Generation X consumers because these
people are looking for particular conveniences when they shop.

Generation X consumers and house makers are a key market because they seek many of the
same conveniences, plus take-home food and 24-hour service

In stressing customer service, Reliance fresh should position themselves in the communities
and neighborhoods as the customer service leader in the market

Stores should continuously track the customer service perception.

Positioning:
Merchandise Management: The objective here is to identify the merchandise

that customers want, and make it available at the right price, in the right place at the right
time. Merchandise Management includes (i) merchandise planning (ii) merchandise purchase,
and (iii) merchandise control. Merchandise planning deals with decisions relating to the
breadth and depth of the mix, needed to satisfy target customers to achieve the retailers return
on investment. This involves sales forecasting, inventory requirements, decisions regarding
gross margins and mark ups etc.

Store Image: A store image is the mental picture, or personality of the store, a retailer likes
to project to customers. Image is affected by advertising, services; store layout, personnel, as
well as the quality, depth and breadth of merchandise. Customers tend to shop in stores that
fit their images of themselves.

Store Personnel: Sales personnel at a retail store can help build customer loyalty and store
image. A major complaint in many lanes of retailing is the poor attitude of a salesperson.
There is a growing trend now, to provide training to, these sales clerks to convert them from
order takers to effective sales associates.
 Store Design: A store's exterior and interior design affect its image and profit potential.
The exterior should be attractive and inviting and should blend with the store's general
surroundings.. Merchandise display is equally important. An effective layout guides the
customer though the various sections in the store and facilitates purchase.

Promotion: retail promotion includes all communication from retailers to consumers and
between sales people and customers. The objective is to build the stores image, promote
customer traffic, and sell specific products. It includes both, personal and non personal
promotion. The media used are TV, Radio, Newspapers, Outdoor displays and direct mail,
other forms of promotion include, displays, special sales, give always and contests etc.

Credits & Collections: Retailers are generally wary of providing credit, because of
additional costs-financing accounts receivables, processing forms and bad debts etc. But
many customers prefer some form of credit while purchasing.

Market Segmentation
Market is not just ANY people, they have to
have Willingness to buy Purchasing power
(money) Authority to buy.
Market Segment is, Set of potential
customers Who have similar needs Who
reference each other when buying.
Big Bazaar in this context have won the hearts
of the customer and also changed the buying
behavior of people as Big Bazaar provides all
items in one roof at low rates.
"We are not in the business of selling
ambience, but in the business of giving the
best possible deals to our consumers.“ This
how the Big bazaar segmented itself from
others and captured the market share.

More Insights on
Segmentation
Segmentation is grouping people who think/are alike
into one.
The segment which Big Bazaar caters to is middle class
consumer. It sets its marketing, prices and products for
this consumer the image that it creates is being cheap
with quality.
Big Bazaar started off with metro cities Kolkata,
Hyderabad, Bangalore and eventually has moved to
Tier-2 and Tier-3 cities .The Indian middle class
consumer is more price-sensitive than service-sensitive

Essentials of
Segmentation – Size
and Profile
Essentials of effective Segmentation can be
Measurable aspects like
Size, Profile.
Big Bazaar in this aspect is spot on. It identified the size
of the market for the better products at a lower price
was huge and entered into the hyper market segment
which gives different products in a single roof.
Being the first largest retail store in India high brand
equity through this Market Segmentation and it has
created a different image for its products as the cheap
and best.

TARGETING
Targeting is generally by evaluating market segments,
Level of competitors, Power of buyers and suppliers.
Generically it targets price conscious customers.
It targets semi-urban population with its placement of
stores,.
Big Bazaar has found that children and women are
primary decision makers and it specifically targets that
category.
Growing young working professionals and Middle class
category is also a preferred category.
For high end population it has launched a merchandise
retailing website www.futurebazaar.com which targets
high-end customers ready to use credit cards.

POSTIONING
Big Bazaar generally Positioned itself as a low-cost
retail outlet and believed in low pricing strategy. This
has been a main factor in attracting the customers.