Multistage Segmentation

It is often necessary to segment a market first one way and then another. For example, most multinationals segment their markets first regionally or nationally (macrosegmentation) and then by another means inside each area (microsegmentation). This can reflect the changing needs of geographical areas or the autonomy that is given to local managers to run their businesses. Often the m aero segmentation is demographic while microsegmeutation is psychographic or behavioural. A Swedish study of an industrial market shows a clear split.-16 At the macro level, the most commonly used methods are geographical, firm size, organization (how customer firms are structured), age of firm and age of the chief executive. At the micro level there is more variety: firms' goals, market niches, competition, competitive advantage, expansion plans, personal needs, type of work done, customer type and size of customers.

At times segmentation may reach to three or more levels. In industrial markets, for instance, a third level could be the individuals within a buying centre -the likely user of a machine tool being approached in a different way to the financial director who would have to pay for it.

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