Niche level segmentation of green consumers: A key for psychographic or demographic predicament

Abstract

Purpose

The purpose of this paper is to find the niche segmentation of green consumers as a solution to psychographic or demographic predicament. Age cohort and generational cohort (Gen Y and Gen Z) of young consumers are studied for individualization and customization.

Design/methodology/approach

Age cohorts (Gen Z and Gen Y customers) have their unique needs. Both Gen Y (1981-1995) and Gen Z (post-1995) belong to the young consumer segment in the age group of 20-30 years but their generational cohorts are different. Strategic marketing advocates both generational marketing based on age cohorts and segmented marketing for young consumers. Strategic marketing faces cross-road between youth segmentation and generational cohort (Gen Z and Gen Y) due to intersection between the two during the 20-30 age group. Primary data using the ecological conscious consumer behavior (ECCB) scale was collected and analyzed for understanding the individual and relative importance of psychographic and demographic factors in influencing green behavior. The traditional youth segment is sliced into four sub-groups (Young Nest 1-4), and their interaction effect with post hoc analysis was done for the identification of sources of difference between different age cohorts. The findings of the study were compared with previous studies and unique contributions of this study were identified.

Findings

The findings indicate multiple niche young segments with demographic as the primary criterion and psychographic as the building block. Niche level and individual level segments emerge due to the interaction of various factors within a given age cohort. The findings confirm the identity development process which considered age as an important factor that affects varying choices throughout life from adolescence to adulthood.

Practical implications

The findings of this study may be used for effective targeting and positioning strategy of green marketing. In the time of analytics, age cohorts and generational cohort of young consumers can be approached differently for yielding better environmental results. The magnified niche level segmentation of young consumers may be used to develop individualized and customized promotions for young customers in Young Nest 1-4 for an enhanced ECCB.

Originality/value

Previous studies have focused more on consumer characteristics (demographic or psychographic) and their relative importance but niche level segmentation within given demographic segment was not attempted before. This study is unique in offering microscopic analysis of age cohorts of young consumers (Young Nest 1-4) and their interaction with other demographic variables (gender and income) for niche level segmentation.

Citation

Verma, S. (2017), "Niche level segmentation of green consumers: A key for psychographic or demographic predicament", South Asian Journal of Business Studies, Vol. 6 No. 3, pp. 274-290. https://doi.org/10.1108/SAJBS-05-2016-0040