BIBLIOGRAPHY TAMTAM, NARCISA T....
BIBLIOGRAPHY
TAMTAM, NARCISA T. APRIL 2013. Market Segmentation of Brewed
Coffee’s Consumer Market in La Trinidad, Benguet. Benguet State University, La
Trinidad, Benguet.
Adviser: Samuel L. Duyan, BSc.
ABSTRACT
This study was conducted to determine the market segmentation of brewed coffee’s
consumer market in La Trinidad, Benguet.
There were 100 respondents considered in the study. Majority of the respondents
were old, male and with income of 5,000 and below. They attained elementary and college
level of education and most of them were self-employed and with 4-6 members.
In terms of psychographic segmentation; the respondents perceived that brewed
coffee did not have added preservatives and they were mostly influenced by their family
members. The respondents were coffee lover in terms of their lifestyle and they were
influenced to buy brewed coffee due its taste and aroma. Almost all the respondents were
Cordilleran in relation to their geographic segmentation. Many of them claimed that
brewed coffee had relaxing effect and health benefits, and accordingly they consume 1-3
cups or more per day. On the other hand, the result showed that some of the respondents
had no loyalty to any brand of coffee.
The results of the study revealed significant relationship of age and gender to
psychographic and behavioral, monthly income to psychographic (particularly who
Market Segmentation of Brewed Coffee’s Consumer Market in La Trinidad, Benguet
TAMTAM, NARCISA T. APRIL 2013
influence them to buy brewed coffee) and behavioral, and region to psychographic
(consumer’s perception on brewed coffee) and behavioral. Further the results showed that
age, gender and monthly income were not significantly associated to region to their
lifestyle and to the factors influencing them to buy.
Market Segmentation of Brewed Coffee’s Consumer Market in La Trinidad, Benguet
TAMTAM, NARCISA T. APRIL 2013
INTRODUCTION
Rationale
Coffee is the top ten cultural crops and considered as one of the most precious
beverages of Filipinos. This is also a potential source of income and livelihood for the
farmers, processors, and marketers. From that, some government agencies have developed
programs/projects
to improve and increase the production of coffee especially in
Cordillera Region because there is large opportunity.
Coffee is sold fresh, dried, or cleaned. A small coffee farm usually does not have
processing facilities, and hence sells fresh berry immediately especially, if the coffee
grower is in need of cash. Normally, however the berries are first dried and brought to the
miller to mill the coffee for fee. Due to the farmer’s ignorance of the prevailing market
price for coffee, they sell their coffee to trust anybody when cash is needed. Despite this
practice, coffee producers indicated that they are not getting an amount to cover the
production cost (Cresencia, 1979).
Brewed coffee is available in the market but the questions are; is the product offered
in the right market and who are the specific buyers? Market segmentation is important to
capture the right market because consumers vary from other consumers. Thus identifying
the market segment for coffee is needed in defining the consumers market and also in
helping the marketers to position their product.
Market segmentation is the process
of dividing a market into meaningful, relatively similar, and identifiable segment or groups
(Hair et al., 2006).
Market Segmentation of Brewed Coffee’s Consumer Market in La Trinidad, Benguet
TAMTAM, NARCISA T. APRIL 2013
4
REVIEW OF LITERATURE
Market Segmentation
It plays a key role in the marketing strategy of almost all successful organizations
and is a powerful marketing tool for several reasons. Most importantly, nearly all markets
include groups of people or organization with different product needs and preferences.
Market segmentation helps marketers define customer needs and wants more precisely.
Because market segment differ in size and potential, segmentation helps decision makers
more accurately define marketing objectives and better allocate resources. In turn,
performance can be better evaluated when objectives are more precise (Hair et al., 2006).
Market Segment
Market segment is a subgroup of people or organizations sharing one or more
characteristics that cause them to have similar product needs. At one extreme, we can
define every organization in the world as a market because each is unique. At the other
extreme, we can define consumer market as one large market segment and the business
market as another large segment. All people have some similar characteristics and needs,
as do all organizations (Hair et al., 2007).
Steps in Segmenting a Market
The purpose of market segmentation, in both consumer and business market is to
identify marketing opportunities.
Market Segmentation of Brewed Coffee’s Consumer Market in La Trinidad, Benguet
TAMTAM, NARCISA T. APRIL 2013
1. Select a market or product category for study. Define the overall market or
product category to be studied. It may be a market in which the firms already competes a
new but related market or product strategy, or a totally new one.
2. Choose a basis for segmenting the market. This step requires managerial insight,
creativity, and market knowledge. There are no scientific procedures for selecting
segmentation variables. However, a successful segmentation scheme must produce
segments that need the four basic criteria.
3. Select segmentation descriptors. After choosing one or more bases, the marketer
must select the segmentation descriptors. Descriptors identify the specific segmentation
variables to use.
4. Profile and analyze segments. The profile should include the segments size,
expected growth, purchase frequency, current brand usage, brand loyalty, and long-term
sales and profit potential. This information can then be used to rank potential market
segments by profit opportunity, risk, consistency with organizational mission and
objectives, and other factors important to the firm (Hair et al., 2006).
Market Segmentation of Brewed Coffee’s Consumer Market in La Trinidad, Benguet
TAMTAM, NARCISA T. APRIL 2013
METHODOLOGY
Locale and Time of the Study
The study was conducted in La Trinidad, Benguet where the respondents buy
brewed coffee.
The study was conducted from December 2012 to January 2013.
Respondents of the Study
The respondents of the study were the consumers of brewed coffee in La Trinidad,
Benguet. There were a total of 100 respondents.
Data Collection
A survey questionnaire was used to collect the needed data. The researcher
personally distributed the questionnaire to the different respondents. A follow-up interview
was done to verify response that is not clear and get response to questions that are not
answered.
Data Gathered
The data gathered included the consumer characteristics in terms of demographic,
psychographic, geographic, and behavioral and the relationship of variables under the
consumer characteristics.
Data Analysis
The data gathered were consolidated, tabulated and analyzed using
frequency counts, percentage and correlation. Pearson chi square was used in correlation.
Market Segmentation of Brewed Coffee’s Consumer Market in La Trinidad, Benguet
TAMTAM, NARCISA T. APRIL 2013
RESULTS AND DISCUSSION
Demographic Segmentation of the Respondents
Table 1 shows the brief demographic profile of the respondents in terms of the
following variables; age, gender, monthly income, educational attainment, occupation and
family size of consumers.
Age. As regard to age, majority (52%) of the respondents were old with age range
of 30 years old and above while 48% were young with age range of 29 years old and below.
This result implies that greater number of respondents were old consumer however the
young also shows a significant number.
Gender. Majority (62%) of the brewed coffee consumers was male and 38% were
female.
Monthly income. Table 1 also presents the monthly income of the consumers.
Seventy two percent of the respondents have monthly income of 5,000 and below, 14%
have 6,000-10,000, 6% have 11,000-15,000 and 7% have 16,000 and above.
Educational attainment. Table 1 presents that all of the respondents had gone to
school. However, the respondents differ on their educational attainment. There were 27%
who reached elementary level, 17% high school level, 22% college level (still studying in
college), 23% finished college and 11% finished vocational course.
Occupation. Table 1 also shows that many (39%) of the respondents were self-
employed. There were 26% of the respondent working in a private sector, 8% in a
government, 25% were student and 2% were unemployed.
Market Segmentation of Brewed Coffee’s Consumer Market in La Trinidad, Benguet
TAMTAM, NARCISA T. APRIL 2013
SUMMARY, CONCLUSIONS AND RECOMMENDATIONS
Summary
The study aimed to identify the market segment of brewed coffee in terms the
consumer characteristic; demographic, geographic, psychographic and behavioral; and,
identify the relationship among the consumer’s characteristics in terms of demographic to
psychographic, geographic and behavioral and geographic to psychographic and
behavioral. Majority of the respondents were old, male and with income of 5,000 and
below. Most of the respondents reached elementary and college they were self-employed
and having family size of 4-6 members.
In terms of psychographic segmentation; the respondent’s perception about brewed
coffee claimed that it has no added preservatives and they were mostly influence by their
family members. The respondents were coffee lover in terms of their lifestyle and they
were influence by the taste and aroma.
As to geographic and behavioral segmentation, almost all the respondents are
Cordilleran. Many of them claimed that brewed coffee is relaxing and it has health benefits.
Further some respondents had no loyalty to any brand of coffee and they mostly consume
1-3 cups or more per day.
Demographic is significantly correlated to psychographic and behavioral especially
age and gender to influence, lifestyle, factors, benefits, loyalty status and frequency of
consumption. Monthly income is also significantly associated to who influence the
consumers to buy, benefits, loyalty status and frequency of consumption.
Market Segmentation of Brewed Coffee’s Consumer Market in La Trinidad, Benguet
TAMTAM, NARCISA T. APRIL 2013
In relation to geographic to psychographic and behavioral only region to
perception and benefits has significant relationship. Cordilleran and non-Cordilleran
respondent differ on their perception about brewed and their claims on the benefit of
brewed coffee.
Conclusions
Based on the findings the conclusions were drawn:
1. Consumers of brewed coffee in La Trinidad, Benguet were those 29 years old
and below and 30 years old and above of age, majority were male, with monthly income
of 5,000 and below, reached formal education, self-employed, private employee,
government employee and with family size of 4-6 members;
2. Majority of the perception about brewed coffee is the absence of added
preservatives in terms of their lifestyle are coffee lover and health conscious, they are
influence by their family members, relatives and friends, and the taste and aroma of coffee
is the factors that influence them to buy;
3. Consumers claimed that brewed coffee is relaxing and it has health benefits and
the study also shows that the respondents always drink brewed coffee of at least 1-3 cups
or more per day; and,
4. Demographic has relationship to psychographic and behavioral specifically age,
gender, and monthly income whilegeographic to psychographic and behavioral only the
region to perception and benefits has significant relationship. Age, gender, and monthly
income to region reveal no relationship.
Market Segmentation of Brewed Coffee’s Consumer Market in La Trinidad, Benguet
TAMTAM, NARCISA T. APRIL 2013
Recommendations
Based on the findings and conclusions the following recommendations were
derived:
1. The consumers of brewed coffee should continue drinking brewed coffee sinceit
does not contain preservative, it is nutritious and in fact it is relaxing;
2. The marketers of brewed coffee should consider the consumers market segment
of brewed coffee to effectively and efficiently provide the needs and wants of this particular
segment; and,
3. The brewed coffee producers should continue to produce coffee to provide the
needs of consumers.
Market Segmentation of Brewed Coffee’s Consumer Market in La Trinidad, Benguet
TAMTAM, NARCISA T. APRIL 2013
LITERATURE CITED
ARMSTRONG, K. and KOTLER, P. 1999. Principles of Marketing. 8th Edition. Prentice
Hall. Pp. 202-208.
ARMSTRONG, K. and KOTLER, P. 2004. Principles of Marketing. Upper Saddle River.
Pp. 239-244.
BEST, R., CONEY, K. and HAWKINS, D. 1992. Consumer Behavior. 5th Edition.
Richard D. Irwin, Inc. Pp. 77 and 81.
BUELL, V. 1984. Marketing Management. McGraw-Hill Book Company. Pp. 103, 96
and 101.
CRESENCIA, R. P. 1979. Present Status and Prospect of Cacao, Coffee and Tea
Industries. UPLB: PCARRD. Pp. 28-32.
ETZEL, M., STANTON, W. and WALKER, B. 1991. Fundamentals of Marketing. 9th
Edition. McGraw-Hill, Inc. P. 99.
HAIR, J., LAMB, C. and MCDANIEL, C. 2006. Introduction to Marketing. 8th
Edition.
Thomson South-Western.Pp. 233-236, 238.
HAIR, J., LAMB, C. and MCDANIEL, C. 2007. Marketing Essentials. 5th Edition.
Thomson South-Western. P. 186.
KOTLER, P. 2000. Marketing Management. 10th Edition. Prentice Hall. Pp. 265, 267,
268.
SOLOMON, M. and STUART, E. 2003. Marketing. Prentice Hall. P. 225.
Market Segmentation of Brewed Coffee’s Consumer Market in La Trinidad, Benguet
TAMTAM, NARCISA T. APRIL 2013
TAMTAM, NARCISA T. APRIL 2013. Market Segmentation of Brewed
Coffee’s Consumer Market in La Trinidad, Benguet. Benguet State University, La
Trinidad, Benguet.
Adviser: Samuel L. Duyan, BSc.
ABSTRACT
This study was conducted to determine the market segmentation of brewed coffee’s
consumer market in La Trinidad, Benguet.
There were 100 respondents considered in the study. Majority of the respondents
were old, male and with income of 5,000 and below. They attained elementary and college
level of education and most of them were self-employed and with 4-6 members.
In terms of psychographic segmentation; the respondents perceived that brewed
coffee did not have added preservatives and they were mostly influenced by their family
members. The respondents were coffee lover in terms of their lifestyle and they were
influenced to buy brewed coffee due its taste and aroma. Almost all the respondents were
Cordilleran in relation to their geographic segmentation. Many of them claimed that
brewed coffee had relaxing effect and health benefits, and accordingly they consume 1-3
cups or more per day. On the other hand, the result showed that some of the respondents
had no loyalty to any brand of coffee.
The results of the study revealed significant relationship of age and gender to
psychographic and behavioral, monthly income to psychographic (particularly who
Market Segmentation of Brewed Coffee’s Consumer Market in La Trinidad, Benguet
TAMTAM, NARCISA T. APRIL 2013
influence them to buy brewed coffee) and behavioral, and region to psychographic
(consumer’s perception on brewed coffee) and behavioral. Further the results showed that
age, gender and monthly income were not significantly associated to region to their
lifestyle and to the factors influencing them to buy.
Market Segmentation of Brewed Coffee’s Consumer Market in La Trinidad, Benguet
TAMTAM, NARCISA T. APRIL 2013
INTRODUCTION
Rationale
Coffee is the top ten cultural crops and considered as one of the most precious
beverages of Filipinos. This is also a potential source of income and livelihood for the
farmers, processors, and marketers. From that, some government agencies have developed
programs/projects
to improve and increase the production of coffee especially in
Cordillera Region because there is large opportunity.
Coffee is sold fresh, dried, or cleaned. A small coffee farm usually does not have
processing facilities, and hence sells fresh berry immediately especially, if the coffee
grower is in need of cash. Normally, however the berries are first dried and brought to the
miller to mill the coffee for fee. Due to the farmer’s ignorance of the prevailing market
price for coffee, they sell their coffee to trust anybody when cash is needed. Despite this
practice, coffee producers indicated that they are not getting an amount to cover the
production cost (Cresencia, 1979).
Brewed coffee is available in the market but the questions are; is the product offered
in the right market and who are the specific buyers? Market segmentation is important to
capture the right market because consumers vary from other consumers. Thus identifying
the market segment for coffee is needed in defining the consumers market and also in
helping the marketers to position their product.
Market segmentation is the process
of dividing a market into meaningful, relatively similar, and identifiable segment or groups
(Hair et al., 2006).
Market Segmentation of Brewed Coffee’s Consumer Market in La Trinidad, Benguet
TAMTAM, NARCISA T. APRIL 2013
4
REVIEW OF LITERATURE
Market Segmentation
It plays a key role in the marketing strategy of almost all successful organizations
and is a powerful marketing tool for several reasons. Most importantly, nearly all markets
include groups of people or organization with different product needs and preferences.
Market segmentation helps marketers define customer needs and wants more precisely.
Because market segment differ in size and potential, segmentation helps decision makers
more accurately define marketing objectives and better allocate resources. In turn,
performance can be better evaluated when objectives are more precise (Hair et al., 2006).
Market Segment
Market segment is a subgroup of people or organizations sharing one or more
characteristics that cause them to have similar product needs. At one extreme, we can
define every organization in the world as a market because each is unique. At the other
extreme, we can define consumer market as one large market segment and the business
market as another large segment. All people have some similar characteristics and needs,
as do all organizations (Hair et al., 2007).
Steps in Segmenting a Market
The purpose of market segmentation, in both consumer and business market is to
identify marketing opportunities.
Market Segmentation of Brewed Coffee’s Consumer Market in La Trinidad, Benguet
TAMTAM, NARCISA T. APRIL 2013
1. Select a market or product category for study. Define the overall market or
product category to be studied. It may be a market in which the firms already competes a
new but related market or product strategy, or a totally new one.
2. Choose a basis for segmenting the market. This step requires managerial insight,
creativity, and market knowledge. There are no scientific procedures for selecting
segmentation variables. However, a successful segmentation scheme must produce
segments that need the four basic criteria.
3. Select segmentation descriptors. After choosing one or more bases, the marketer
must select the segmentation descriptors. Descriptors identify the specific segmentation
variables to use.
4. Profile and analyze segments. The profile should include the segments size,
expected growth, purchase frequency, current brand usage, brand loyalty, and long-term
sales and profit potential. This information can then be used to rank potential market
segments by profit opportunity, risk, consistency with organizational mission and
objectives, and other factors important to the firm (Hair et al., 2006).
Market Segmentation of Brewed Coffee’s Consumer Market in La Trinidad, Benguet
TAMTAM, NARCISA T. APRIL 2013
METHODOLOGY
Locale and Time of the Study
The study was conducted in La Trinidad, Benguet where the respondents buy
brewed coffee.
The study was conducted from December 2012 to January 2013.
Respondents of the Study
The respondents of the study were the consumers of brewed coffee in La Trinidad,
Benguet. There were a total of 100 respondents.
Data Collection
A survey questionnaire was used to collect the needed data. The researcher
personally distributed the questionnaire to the different respondents. A follow-up interview
was done to verify response that is not clear and get response to questions that are not
answered.
Data Gathered
The data gathered included the consumer characteristics in terms of demographic,
psychographic, geographic, and behavioral and the relationship of variables under the
consumer characteristics.
Data Analysis
The data gathered were consolidated, tabulated and analyzed using
frequency counts, percentage and correlation. Pearson chi square was used in correlation.
Market Segmentation of Brewed Coffee’s Consumer Market in La Trinidad, Benguet
TAMTAM, NARCISA T. APRIL 2013
RESULTS AND DISCUSSION
Demographic Segmentation of the Respondents
Table 1 shows the brief demographic profile of the respondents in terms of the
following variables; age, gender, monthly income, educational attainment, occupation and
family size of consumers.
Age. As regard to age, majority (52%) of the respondents were old with age range
of 30 years old and above while 48% were young with age range of 29 years old and below.
This result implies that greater number of respondents were old consumer however the
young also shows a significant number.
Gender. Majority (62%) of the brewed coffee consumers was male and 38% were
female.
Monthly income. Table 1 also presents the monthly income of the consumers.
Seventy two percent of the respondents have monthly income of 5,000 and below, 14%
have 6,000-10,000, 6% have 11,000-15,000 and 7% have 16,000 and above.
Educational attainment. Table 1 presents that all of the respondents had gone to
school. However, the respondents differ on their educational attainment. There were 27%
who reached elementary level, 17% high school level, 22% college level (still studying in
college), 23% finished college and 11% finished vocational course.
Occupation. Table 1 also shows that many (39%) of the respondents were self-
employed. There were 26% of the respondent working in a private sector, 8% in a
government, 25% were student and 2% were unemployed.
Market Segmentation of Brewed Coffee’s Consumer Market in La Trinidad, Benguet
TAMTAM, NARCISA T. APRIL 2013
SUMMARY, CONCLUSIONS AND RECOMMENDATIONS
Summary
The study aimed to identify the market segment of brewed coffee in terms the
consumer characteristic; demographic, geographic, psychographic and behavioral; and,
identify the relationship among the consumer’s characteristics in terms of demographic to
psychographic, geographic and behavioral and geographic to psychographic and
behavioral. Majority of the respondents were old, male and with income of 5,000 and
below. Most of the respondents reached elementary and college they were self-employed
and having family size of 4-6 members.
In terms of psychographic segmentation; the respondent’s perception about brewed
coffee claimed that it has no added preservatives and they were mostly influence by their
family members. The respondents were coffee lover in terms of their lifestyle and they
were influence by the taste and aroma.
As to geographic and behavioral segmentation, almost all the respondents are
Cordilleran. Many of them claimed that brewed coffee is relaxing and it has health benefits.
Further some respondents had no loyalty to any brand of coffee and they mostly consume
1-3 cups or more per day.
Demographic is significantly correlated to psychographic and behavioral especially
age and gender to influence, lifestyle, factors, benefits, loyalty status and frequency of
consumption. Monthly income is also significantly associated to who influence the
consumers to buy, benefits, loyalty status and frequency of consumption.
Market Segmentation of Brewed Coffee’s Consumer Market in La Trinidad, Benguet
TAMTAM, NARCISA T. APRIL 2013
In relation to geographic to psychographic and behavioral only region to
perception and benefits has significant relationship. Cordilleran and non-Cordilleran
respondent differ on their perception about brewed and their claims on the benefit of
brewed coffee.
Conclusions
Based on the findings the conclusions were drawn:
1. Consumers of brewed coffee in La Trinidad, Benguet were those 29 years old
and below and 30 years old and above of age, majority were male, with monthly income
of 5,000 and below, reached formal education, self-employed, private employee,
government employee and with family size of 4-6 members;
2. Majority of the perception about brewed coffee is the absence of added
preservatives in terms of their lifestyle are coffee lover and health conscious, they are
influence by their family members, relatives and friends, and the taste and aroma of coffee
is the factors that influence them to buy;
3. Consumers claimed that brewed coffee is relaxing and it has health benefits and
the study also shows that the respondents always drink brewed coffee of at least 1-3 cups
or more per day; and,
4. Demographic has relationship to psychographic and behavioral specifically age,
gender, and monthly income whilegeographic to psychographic and behavioral only the
region to perception and benefits has significant relationship. Age, gender, and monthly
income to region reveal no relationship.
Market Segmentation of Brewed Coffee’s Consumer Market in La Trinidad, Benguet
TAMTAM, NARCISA T. APRIL 2013
Recommendations
Based on the findings and conclusions the following recommendations were
derived:
1. The consumers of brewed coffee should continue drinking brewed coffee sinceit
does not contain preservative, it is nutritious and in fact it is relaxing;
2. The marketers of brewed coffee should consider the consumers market segment
of brewed coffee to effectively and efficiently provide the needs and wants of this particular
segment; and,
3. The brewed coffee producers should continue to produce coffee to provide the
needs of consumers.
Market Segmentation of Brewed Coffee’s Consumer Market in La Trinidad, Benguet
TAMTAM, NARCISA T. APRIL 2013
LITERATURE CITED
ARMSTRONG, K. and KOTLER, P. 1999. Principles of Marketing. 8th Edition. Prentice
Hall. Pp. 202-208.
ARMSTRONG, K. and KOTLER, P. 2004. Principles of Marketing. Upper Saddle River.
Pp. 239-244.
BEST, R., CONEY, K. and HAWKINS, D. 1992. Consumer Behavior. 5th Edition.
Richard D. Irwin, Inc. Pp. 77 and 81.
BUELL, V. 1984. Marketing Management. McGraw-Hill Book Company. Pp. 103, 96
and 101.
CRESENCIA, R. P. 1979. Present Status and Prospect of Cacao, Coffee and Tea
Industries. UPLB: PCARRD. Pp. 28-32.
ETZEL, M., STANTON, W. and WALKER, B. 1991. Fundamentals of Marketing. 9th
Edition. McGraw-Hill, Inc. P. 99.
HAIR, J., LAMB, C. and MCDANIEL, C. 2006. Introduction to Marketing. 8th
Edition.
Thomson South-Western.Pp. 233-236, 238.
HAIR, J., LAMB, C. and MCDANIEL, C. 2007. Marketing Essentials. 5th Edition.
Thomson South-Western. P. 186.
KOTLER, P. 2000. Marketing Management. 10th Edition. Prentice Hall. Pp. 265, 267,
268.
SOLOMON, M. and STUART, E. 2003. Marketing. Prentice Hall. P. 225.
Market Segmentation of Brewed Coffee’s Consumer Market in La Trinidad, Benguet
TAMTAM, NARCISA T. APRIL 2013