Source: New York Times, as reported in Daily Camera

• About 80 large MSAs are categorized as Primary Metropolitan Statistical Areas (PMSA) by virtue of (1) having a population of at least 1 million and (2) being part of a giant urban center or CMSA.

• A Consolidated Metropolitan Statistical Area (CMSA) is a giant urban center consisting of two or more contiguous PMSAs. The hub of each of the approximately 25 CMSAs is a very large city such as New York, Los Angeles, Chicago, or Philadelphia.

Suburban Growth Within our growing metropolitan areas, other changes have been taking place. The central cities are growing very slowly, and in some cases older established parts of the cities are actually losing population. The real growth is occurring in fringe areas of the central cities or in suburbs outside these cities. As middle-income families have moved to the suburbs, the economic, racial, and ethnic composition of many central cities (especially the core areas) has changed considerably. This has altered the nature of the market in these areas. Two changes in the suburban population have striking market implications. One is the changing racial mix in many suburbs, mainly as a result of the in-migration of minorities. The other is a significant increase in the numbers of single people and single-parent families living in suburbia.

Since a great percentage of suburban people live in single-family resi­dences, there is a vastly expanded market for lawn mowers, lawn furniture, home furnishings, and home repair products. Suburbanites are more likely to want two cars than are city dwellers. They are inclined to spend more leisure time at home, so there is a bigger market for home entertainment and recrea­tion items.

⁴For further explanation and clarification of this somewhat complex market measurement sys­tem, see James C. Douthit, "Whatever Happened to the SMSA System?" Marketing Nra'5, Jan. 4, 1988, p. 48.

Service organizations typically must locate close to their market. Thus we have seen banks, insurance companies, and other financial services firms open branches or start new ventures in the suburbs. Some theaters, sports arenas, and other entertainment centers have closed their central-city sites and relocated in the suburbs. Health care organizations (American Cancer Society, American Heart Association), political parties, art museums, and other nonprofit groups use suburban Zip-code areas for their mailings that seek contributions.

Demographic Segmentation The most common basis for segmenting consumer markets is some demographic category such as age, sex, family life-cycle stage, income distribution, education, occupation, or ethnic origin.

AGE GROUPS

We are well aware that our wants change as we go through life. In recognition of this fact, countless firms use age categories as one basis for segmenting the consumer market. Marketing executives should be aware of the changing nature of the age mix. Looking ahead to the year 2000, we anticipate both slower population growth and an aging population. In the mid-1980s, for the first time in our history, the number of Americans 65 and over exceeded the number of teenagers.

The youth market (roughly ages 5 to 13) carries a three-way marketing impact. First, these children can influence parental purchases. Second, bil­lions of dollars are spent on this group by their parents. Third, these children themselves buy goods and services for their own personal use and satisfac­tion. Promotional programs are often geared to this market segment. Chil­dren's television shows, for instance, are sponsored by cereal, toy, and video­game manufacturers, among others, in an effort to develop brand preferences at an early age.⁵

The teenage market is large and free-spending, and yet it has proved diffi­cult to reach. The mistake might be lumping all teenagers into one group; certainly the 13-to-16 age group is very different from the 17-to-20 age bracket. Yet marketers must try to understand teenage consumers because of the size of this market and because its members have a considerable amount of money to spend. And almost all of their money is purely discretionary. Although the number of teenagers has declined appreciably since the 1970s, going through the 1990s there still will be millions of teenagers with substantial incomes from part-time jobs and two income-earning parents. These youngsters con­stitute a big market for vidéocassettes, apparel, cosmetics, autos, stereos, records, and other products.

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