To understand the concept ofmarket segmentation, let's examine something most of us love: food. Indeed, it's something we're all experts on.

Consider restaurants, for example. Look at the number of eating establishments in your community. If you owned a restaurant, how would you market it? Assume you own a steak house done in a southwestern decor. Suppose a consumer can get full by eating at McDonald's for a few bucks or at a fancy French restaurant down the road for $75. At whom will you aim your advertising to get the most return?

Why do different people go to different restaurants? Restaurants can't offer all foods to all patrons. Each restaurant has some appeal to some group of people. Successful restaurants, like other successful businesses, focus on a segment of a given populationor the specific needs of a given population. The next time you're in a restaurant, watch people. Unless it's the only place in town, you'll likely notice common denominators.

Are people eating at a restaurant because the food is fast, because the food is good, because the atmosphere is romantic, because the food is healthful, because the food is cheap, because the food is not cheap, because the food is in style? Is the restaurant frequented because of a chef, because of the service, because of selection? Is this a good restaurant to have a business lunch in? Is the food ethnicChinese, Mexican, Japanese, Italian?

Why do people come to one place at a given time and not another? Would you consider taking a prom date to eat at a food truck? Would you go to an uptown French restaurant for lunch between classes?

Each restaurant appeals to a segment of the population. How would you advertise your steak house? A good place to start would be research. You'd want to look at the customers who would patronize your place. You'd want to identify the common traits of the patrons. Once you'd done this, you'd have an idea about where to start

Question

You notice that the folks in your place are mostly in their late 20s and 30s. Most dress well but in casual clothes. A lot of sport utility vehicles are in the parking lot. A large percentage of the customers pay with credit cards. Nearly everyone has a small cell or digital phone, and at least half carry planners. Diners, as a rule, are couples, usually two or three couples to a table. You assume that most are white-collar workers with at least several years of college. Based in this description of your customers, list three things you think they have in common.What makes you think that?