Way of segmenting the family market by different stages of the life cycle to determine the products (g & s) that peo

1. Family Life Cycle Way of segmenting the family market by different stages of the life cycle to determine the products (g & s) that people buy at each stage

2. Key Variables • Age • Marital Status • Career • Presence/Absence of Children • Income • Disposable – • Take-home • Discretionary – • Mad Money

3. Bachelor Stage • Young single, not living at home • Low disposable, but high discretionary income • Decisions influenced by their peers/reference groups • Few financial burdens • Fashion/Opinion leaders • Recreation oriented Buys basic kitchen stuff, basic furniture, cars, clothes, travel, products for the “mating game”

4. Newly Married Couples • Young, no children • Better off financially than they will be in the near future • High income, but high financial commitments • Homes • Durable goods Buys cars, white goods, furniture, travel, life insurance

5. Full Nest I • Youngest child under 6 • Income low / high debt • Liquid assets/savings low • Reliance on credit • Home purchasing at peak • Spending dominated by children’s needs Buys necessities Purchases shift to focus on child: furniture, car, vacations, entertainment

6. Full Nest II • Youngest child over 6 • Income improving • Lower mortgage burden • Spending dominated by children’s needs Buys necessities Purchases continue to focus on child’s needs: furniture, activities, education, clothing, transportation

7. Full Nest III • Older married with dependent children • children at work/higher education • Financially sound • More wives at work • Mortgage burden even less • School dominated household Money spent to support kids education Buys more tasteful furniture, non-necessary household items, vacations

8. Empty Nest I • Older married couple, no children at home • Head of family still works • Expenses low! • Interested in travel, recreation, self-education Buys luxuries Purchases shift to self: home improvements, travel, care of self and exploration of interests

9. Empty Nest II • Older married couple, no children at home • Head of family retired • Significant cut in income • Concern with retirement, health • Grandchildren create new influence for money and time Spending on hobbies, interests, medical care Spending on children and grandchildren

10. Sole Survivor I • Spouse has died, but still in workforce • Income adequate, but likely to downsize home • Concern with retirement and savings • Worried about security and dependence Spend on hobbies and interests

11. Sole Survivor II • Spouse has died, retired • Significant cut in income • Additional medical needs • Special need for attention and security • Dependence on others • May sell home and move to community living Limited spending

12. Alternative Life Cycles

13. Family Life Cycle http://tutor2u.net/business/presentations/marketing/familylifecycle/default.html