Consider the luxury automobile product category and a specific product in this c
ID: 377923 • Letter: C
Question
Consider the luxury automobile product category and a specific product in this category – the Mercedes-Benz CLA sedan car in this category. Please visit the product website to learn more about this product.
Identify the segmentation methods (e.g., demographics, psychographics, etc.) you think would be most appropriate for this product category. Please discuss why you made this choice.
For each segmentation method chosen in Q2, identify the specific variables that would be useful in segmentation (e.g., for demographics the variables will be gender, age, etc.). Why do you think these variables will be useful for segmentation?
For each variable chosen in Q3, identify the levels that you want to use for each variable (e.g., for age the levels could be < 18, 18-25, 25-45, > 45, for gender the levels could be male, female)
Using the scheme you described in Q2 to Q4, identify and describe 3 specific segments (e.g., males in the 25-45 age group in urban areas). Please discuss likely characteristics of each segment.
Choose one or more segments identified in Q5 and describe why this segment will be a good target market for the product in Q1.
Explanation / Answer
2. Demographic segmentation is the best method of segmenting the target group for Mercedes CLA sedan. This is done on the basis of certain characterstics like age, race,gender, ethnicity, income, education, marital status, occupation etc.
3. Most important characterstics based on the segmentation are age, income, education and occupation for the product. These are important because purchase of a Mercedes is a high value decision, necessiating high income, social status, that relates to occupation and education of the purchaser. Age is also an important differentiator, as the customers are usually professionals / businessmen in the age group of 25-45 years.
4. Typical segmentation -
Age - 25-45 years. In some cases 45-65 years.
Education - Professional degree. University degree
Income- $150000-$200000 per annum onwards.
Occupation - Executives. Middle to Senior management, Business owners having a mid to large size business, professionals like doctors, lawyers and scientists.
Gender - Either.
5. Three specific segments
(a) Professionals and Executives aged 25-45 years living in urban areas
(b) Traders and Businessmen aged between 25-65 years, having an annual income over $200000.
(c) Women professionals aged 25-60 years, having annual income of $150000 and above or Women executives working in capacity of General Manager and above.
6. Segment (a) will be a suitable one because of the purchase capacity, taste for luxury, sense of appreciation of fine quality and the compatibility of the product with their social status.