Segmentation provides a microscopic view of the customers' needs and guides the marketer to plan an appropriate marketing-mix for specific segments. This article discusses some aspects of segmentation in the Indian financial services market.

Services are volatile in nature and marketing of financial services is concept selling. Financial services industry is experiencing intensifying competition, both, in terms of number of service providers and in the proliferation of service offerings. The competitive climate in the Indian financial services market has changed dramatically over the last few years and simultaneously, changes have also been taking place in regulatory and technological environment. Catalytic impact of liberalization, privatization, globalization and industrialization has contributed to the emergence of private and foreign financial institutions and has given way to the introduction of newer services to be introduced in the financial services industry every now and then. Also, the shift in consumer behavior has forced the service providers to pay focused attention to consumers with similar financial needs in financial services market. Once the attention is focused on smaller segments of the otherwise a large market, the whole marketing process becomes effective. Thus, segmentation proves to be an important marketing technique.

Segmentation is a simple marketing technique of dividing the whole market into smaller segments. A segment can be identified as a group of customers with similar attributes. Segmentation is the process of identification of customers on the basis of some common characteristic and placing them in one group called segment. A segment can consist of all male customers with annual gross income of Rs. 3 to 5 lakh and another segment can consist of all female customers who are self-employed. It is obvious that the requirements of two segments are similar within the segment but are different from other segments. Segmentation focuses on the needs of the consumers prior to clubbing them into a particular segment. Segmentation is the process of dividing the heterogeneous market into smaller homogenous segments in order to serve the customers in an effective manner.

Advertising Express, Financial Services Market, Technological Environment, Liberalization, Privatization, Globalization, LPG, ICICI Prudential, Telemarketing, Automated Teller Machines, ATMs, Aviva Life Insurance, Demographic Segmentation, GE Money, phone banking, Net banking.