1. Geographical variables
Market segmentation by geographic variables is to divide the market into different geographical regions, such as countries, regions, provinces, cities, east, west, south, north, cities, rural areas, mountainous areas, plains, plateaus, lakes, deserts, etc. Geographical variables are used as the basis for market segmentation because geographical factors affect consumer demand and response. Due to the influence of natural climate, transportation and communication conditions, traditional culture, economic development level and other factors, different regions have formed different consumption habits and preferences, and have different demand characteristics. For example, people living in different regions of my country have very different food tastes. As the saying goes, “sweet in the south, salty in the north, spicy in the east and sour in the west”, which has also formed famous cuisines such as Cantonese cuisine, Sichuan cuisine, and Shandong cuisine.
2. Demographic variables
Demographic variable segmentation is to segment the market into several consumer groups according to demographic factors such as age, gender, family size, life cycle, income, occupation, education, religion, ethnicity, nationality, and social class. For example, the clothing market can be divided into two markets according to the segmentation variable “gender”: men’s clothing market and women’s clothing market. If we use the segmentation variable “age” again, we can divide the market into 7 segments: children’s clothing market, young men’s and women’s clothing market, middle-aged men’s and women’s clothing market, and elderly men’s and women’s clothing market. The reason why Pepsi-Cola was able to seize nearly half of the market share from the beverage market that Coca-Cola almost dominated was mainly due to market segmentation. It developed and opened up the “new generation” in the United States, a market area that Coca-Cola was not aware of, and became the new generation of Coca-Cola. There are many products, such as clothing and cosmetics, and consumers of different genders and ages have very different purchasing characteristics. For example, women of different ages have obvious differences in their choice of skin care products. Moreover, income and education level also directly affect the purchasing characteristics of buyers.