Session 5

Today's session is going to detail the VALS strategy , a research method for market segmentation.

The VALS strategy classifies individuals based on their mindset using physiological traits and other factors which drives consumer behavior. The main components it incorporates are:

·         Motivation

·         Resources

For it is a combination of the two above mentioned qualities which determines the true behavior of an individual. Using these inputs, VALS strategy classifies individuals into 8 distinct categories namely;

·         Innovators - Innovators are successful, sophisticated, take-charge people with high self-esteem. Because they have such abundant resources, they exhibit all three primary motivations in varying degrees. They are change leaders and are the most receptive to new ideas and technologies. Innovators are very active consumers, and their purchases reflect cultivated tastes for upscale, niche products and services. They are concerned about the image that they project

·         Thinkers - Thinkers are motivated by ideals. They are mature, satisfied, comfortable, and reflective people who value order, knowledge, and responsibility. They tend to be well educated and actively seek out information in the decision-making process. They are well-informed about world and national events and are alert to opportunities to broaden their knowledge

·         Believers - Like Thinkers, Believers are motivated by ideals. They are conservative, conventional people with concrete beliefs based on traditional, established codes: family, religion, community, and the nation. Many Believers express moral codes that have deep roots and literal interpretation. As consumers, Believers are predictable; they choose familiar products and established brands.

·         Achievers - Motivated by the desire for achievement, Achievers have goal-oriented lifestyles and a deep commitment to career and family. Their social lives reflect this focus and are structured around family, their place of worship, and work. Achievers live conventional lives, are politically conservative, and respect authority and the status quo. Achievers are active in the consumer marketplace. Image is important to Achievers; they favor established, prestige products and services that demonstrate success to their peers

·         Strivers - Strivers are trendy and fun loving. Because they are motivated by achievement, Strivers are concerned about the opinions and approval of others. Money defines success for Strivers, who don't have enough of it to meet their desires. They favor stylish products that emulate the purchases of people with greater material wealth. Strivers are active consumers because shopping is both a social activity and an opportunity to demonstrate to peers their ability to buy. As consumers, they are as impulsive as their financial circumstance will allow

·         Experiencers - Experiencers are avid consumers and spend a comparatively high proportion of their income on fashion, entertainment, and socializing. Their purchases reflect the emphasis that they place on looking good and having "cool" stuff

·         Makers - Makers are suspicious of new ideas and large institutions such as big business. They are respectful of government authority and organized labor but resentful of government intrusion on individual rights. They are unimpressed by material possessions other than those with a practical or functional purpose. Because they prefer value to luxury, they buy basic product

·         Survivors - Survivors are cautious consumers. They represent a very modest market for most products and services. They are loyal to favourite brands, especially if they can purchase them at a discount.

Based on this framework an analysis of consumers and which segment they fall in. Based on which segment the consumer falls into a strategy needs to be devised to target these individuals. Every segment has different individuals which have different requirements and needs. Based on these needs, the strategy for promotion has to be made. Similarly positioning of the products for different segments need to be done. In case the same strategy is used for all segments it shall lead to confusion of the perception of products leading to lower sales and lower profitability.