Download Market Segmentation Analysis for Pyramid Lake Child Care

TECHNICAL REPORT
UCED 2011/12-01
MARKET SEGMENTATION ANANLYSIS FOR PYRAMID LAKE CHILD CARE
PROPOSAL
UNIVERSITY OF NEVADA, RENO
1
Market Segmentation Analysis for Pyramid Lake Child Care Proposal
Report Prepared by
Thomas R. Harris
Margaret Cowee
and
Anita Castledine
Thomas R. Harris is a Professor in the Department of Economics and Director of the University
Center for Economic Development at the University of Nevada, Reno.
Margaret Cowee is a Research Associate in the University Center for Economic Development at
the University of Nevada, Reno.
Anita Castledine is a Research Associate in the University Center for Economic Development at
the University of Nevada, Reno.
University Center for Economic Development
Department of Agricultural Economics
University of Nevada, Reno
Reno, Nevada
(775) 784-1681
September, 2011
UNIVERSITY
OF NEVADA
RENO
The University of Nevada, Reno is an Equal Opportunity/Affirmative Action employer and does not discriminate on the
basis of race color religion sex age creed national origin veteran status physical or mental disability and in accordance with
university policy sexual orientation in any program or activity it operates. The University of Nevada employs only United
States citizens and aliens lawfully authorized to work in the United States.
2
This publication, Market Segmentation Analysis for Pyramid
Lake Child Care Proposal, was published by the University of
Nevada Economic Development Center. Funds for the
publication were provided by the Pyramid Lake Paiute Tribe
and the United States Department of Commerce Economic
Development Administration under University Centers
Program contract #07-66-06415-02. This publication's
statements, findings, conclusions, recommendations, and/or
data represent solely the findings and views of the authors and
do not necessarily represent the views of the Pyramid Lake
Paiute Tribe, the United States Department of Commerce, the
Economic Development Administration, University of Nevada,
or any reference sources used or quoted by this study.
Reference to research projects, programs, books, magazines,
or newspaper articles does not imply an endorsement or
recommendation by the authors unless otherwise stated.
Correspondence regarding this document should be sent to:
Thomas R. Harris, Director
University Center for Economic Development
University of Nevada, Reno
Department of Agricultural Economics
Mail Stop 204
Reno, Nevada 89557-0105
UCED
University of Nevada, Reno
Nevada Cooperative Extension
Department of Agricultural Economics
3
SUMMARY
This report provides a market segmentation analysis of a potential child care facility in
Wadsworth, Nevada. Below is a summary of the market segmentation study.

Nationally with the growth of working two-parent families and single-parent families,
the need for child care in urban and rural areas of the nation is evident.

For this market analysis, four Census Designated Places (CDP’s) will be used. These four
CDP’s are Nixon, Wadsworth, Sutcliffe, and Fernley.

From the 2010 Census, population in the Nixon CDP decreased by 44 people, population
in the Wadsworth CDP declined by 47 people from 2000 to 2010, population in the
Sutcliffe CDP declined by 28 people from 2000 to 2010 while for the Fernley CDP
population increased by 10,825 persons from 2000 to 2010.

In order to effectively market to these CDP areas, the tribe must be aware of the
customer types that live in these CDP’s and market accordingly. For the Nixon,
Wadsworth, and Sutcliffe CDP’s, these areas have customers in a Life Mode customer
classification of American Quilt with sub-group designated as Crossroads. This customer
type is primarily a rural customer working in agriculture, manufacturing, local
government, services, construction, and utilities. Families with children who are mindful
of their expenses represent this customer type. This customer type is represented by
two-parent working families looking for affordable child care.

The Fernley CDP being larger has a more diverse customer type. Like the previous three
CDP’s, the Fernley CDP has the American Quilt and Crossroads customer types. Fernley
also has Upscale Avenue customer class which is primarily older families who are retired
with higher than average incomes. Grandparents are represented by this customer class
who may demand child care from time to time. Fernley also has sub-customer groups of
Green Acres and Midland Crowd. The Green Acres customers are blue collar workers
with children. They have a high labor participation rates which means this customer
type demands child care services. The Midland Crowd consumer is a growing consumer
segment with half being married couples with children. This is a two-parent working
family that demands child care services. Therefore given the growing population of
Fernley and its consumer types that live in the CDP, the Fernley child care customer
should be targeted by the proposed Wadsworth Child Care Facility.

One area of feasibility is to investigate the competition in the area. The Fernley CDP has
three child care facilities open to the public while the Nixon CDP has one. Even with
three child care centers, the Fernley CDP may need another child care facility because
each child care center in Fernley serves 1,246 children.
4

Using data from the Little Warrior Learning Center, the capture of children by CDP by
age group was derived. Currently eleven children are from Nixon CDP, 27 from
Wadsworth, no children from Sutcliffe CDP and six from Fernley CDP.

Also the Little Warrior Learning Center provided per child revenue charges per day by
age group. With the projected population growth rates for each CDP from 2010 to
2015, the estimated growth in child care would be from 44 to 48. With this increase in
capture, total weekly revenue from the proposed Wadsworth facility by 2015 is
estimated to be $3,965.

Given the number of people and children who live in Fernley CDP and if the tribe
initiated marketing strategies that would increase capture of children in all age groups
from Fernley CDP by 0.1%, attendance from Fernley CDP would increase by five children
and weekly revenues would increase by $465.

For any feasibility analysis, marketing strategies to increase capture of children of all age
groups from Fernley CDP maybe a profitable venture.
5
MARKET SEGMENTATION FOR PYRAMID LAKE CHILD CARE PROPOSAL
Introduction and Maps:
With the rise in number of two-parent working families and the number of single-parent
families in the United States, so has the demand for child care services. In the latter part of the
last century, more than one-half of children in the United States received child care from
someone other than an immediate family member during at least part of the day. This
demonstrates the need for child care facilities in both urban and rural areas.
The trade area for Pyramid Lake Reservation Child Care facility is the area where most
customers who may patronize Pyramid Lake Reservation Child Care facilities live. The most
accurate way to find and define trade areas is to use actual customer data obtained by Pyramid
Lake Tribe Child Care facilities on customer addresses, zip codes and amount of purchase. This
method is known as “customer spotting.” Different businesses may have very different trade
areas, however, and the customer spotting method requires substantial data collection. Another
method for defining trade areas is using average driving times. This method uses existing data
and results can be found quickly. Average drive times combined with Census-Designated Place
(CDP), and conversations with Pyramid Lake Reservation leaders are used in this report to
define the Pyramid Lake Child Care trade area. CDP is a concentration of population identified
by the United States Census Bureau for statistical purposes. CDP’s are populated areas that lack
separate municipal government, but which otherwise physically resemble incorporated places.
These four CDP’s are Nixon, Wadsworth, Sutcliffe, and Fernley. The CDP area maps are shown
in figures 1 through 4.
Given the national trends for child care, the Pyramid Lake Tribe requested a market study
for a proposed child care facility in the Wadsworth, Nevada Area. In order to meet this objective,
the paper is divided into three parts. The first section displays and discusses the Census 2010
data for the four CDP areas. The second section provides an analysis of customer types living in
the CDP areas. The final section provides an estimate of potential demand for the Pyramid Lake
Reservation Child Care facilities for each CDP area and total market area. The final section also
estimates potential revenue increases if market capture in Fernley CDP were increased.
6
Figure 1. Map of Nixon CDP
Source: ESRI Business Analyst
7
Figure 2. Map of Wadsworth CDP
Source: ESRI Business Analyst
8
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Figure 3. Map of Sutcliffe CDP
Source: ESRI Business Analyst
9
Figure 4. Map of Fernley CDP
Source: ESRI Business Analyst
10
Census 2010 Data:
Table 1 shows the available Census 2010 data for the Nixon CDP. The population for the Nixon
CDP is estimated to be 374 people. In 2000, the population for Nixon was estimated to be 418
people. Between the Census of 2000 and 2010, the population covering the Nixon CDP has
declined by 44 people. Also from the Census 2010 data, approximately 90% of housing units are
occupied in this CDP area.
Table 1. 2010 Census Data for the Nixon CDP
Total Population, 2010
Total Population, 2000
Total Housing Units, 2010
Occupied Housing Units, 2010
Number
374
418
142
128
Percent of total
100.0%
100.0%
100.0%
90.1%
Source: ESRI, 2011
Table 2 shows the available Census 2010 data for the Wadsworth CDP. From Table 2, the 2010
population for the Wadsworth CDP is estimated to be 834. In 2000, the population for the
Wadsworth CDP was 881. Population in the Wadsworth CDP declined by 47 people during this
decade. Also from the Census 2010 data, approximately 91% of housing units are occupied in
this CDP area.
Table 2. 2010 Census Data for Wadsworth CDP
Total Population, 2010
Total Population, 2000
Total Housing Units, 2010
Occupied Housing Units, 2010
Number
834
881
350
319
Percent of total
100.0%
100.0%
100.0%
91.1%
Source: ESRI, 2011
Table 3 shows available Census data for the Sutcliffe CDP. From Table 3, the 2010 population
for the Sutcliffe CDP is estimated to be 253. The population for the Sutcliffe declined from 281
in 2000 to 253 in 2010 or a decrease of 28 people. Also from the Census 2010 data,
approximately 87% of housing units are occupied in this CDP area.
11
Table 3. 2010 Census Data for Sutcliffe CDP
Total Population, 2010
Total Population, 2000
Total Housing Units, 2010
Occupied Housing Units, 2010
Number
253
281
120
104
Percent of total
100.0%
100.0%
100.0%
86.7%
Source: ESRI, 2011
Table 4 shows the available 2010 Census data for the Fernley CDP. From table 4, the Census
2010 population for the Fernley CDP was estimated to be 19,368. The population for the Fernley
CDP area grew from 8,543 in 2000 to 19,368 or an increase of 10,825 persons. Also from the
Census 2010 data, approximately 88% of housing units are occupied in this CDP area.
Table 4. 2010 Census Data for Fernley CDP
Total Population, 2010
Total Population, 2000
Total Housing Units, 2010
Occupied Housing Units, 2010
Number
19,368
8,543
7,975
7,048
Percent of total
100.0%
100.0%
100.0%
88.4%
Source: ESRI, 2011
Site Map
Classification of Neighborhoods Using Tapestry Segmentation Profiles for the Pyramid
Lake Child Care Market Area
ESRI Business Analyst On-line has developed profiles for neighborhoods by using U.S. Census
and other data. Using detailed Census data on sex, age, education, income, occupation,
household composition, housing characteristics, and so forth, in combination with other private
and public data sources, ESRI models divide cities into neighborhood classifications thought to
best represent the types of families choosing to live there. ESRI uses 65 detailed profiles for
neighborhood type, each of which is a member of 12 “Life Mode Summary Groups” with similar
socio-economic status and age cohorts. Of course, the categories will not exactly describe each
household in a neighborhood but market specialists have found the profiles useful in
understanding the general nature of the customers in a particular neighborhood. A summary of
the ESRI profiles for those most commonly found in the Pyramid Lake Child Care Trade Areas
is shown below. The detailed distribution can be found in Appendix A along with ESRI’s full
description of each of the tapestry segments.
12
Nixon CDP Trade Area
The estimated 160 households within the Nixon CDP fall into one Life Mode Group which is
American Quilt.

American Quilt: Households in small towns and rural areas. Manufacturing and
agriculture remain part of the local economy, but American Quilt can include workers
in local government, service, construction, communication, and utilities.
Within this Life Mode Group, Nixon CDP neighborhoods are further classified as belonging
to one of the 65 detailed sub-groupings. The “American Quilt” group has been categorized
into one sub-grouping, “Crossroads.” An abridged ESRI description of this sub-grouping is
below. For a full description see Appendix A.

Crossroads: Growing communities in small towns, median age of 32.1, and
population growing 1.6% annually. Crossroads consumers are mindful of their
expenses, shop at discount stores, and families are their main priority.
Wadsworth CDP Trade Area
The 395 households included in the Wadsworth CDP are similar to the Nixon CDP. The only
Life Mode Group in this CDP is “American Quilt” group with one sub-grouping being
“Crossroads.” A full description of this sub-group is shown in Appendix A.

American Quilt: Households in small towns and rural areas. Manufacturing and
agriculture remain part of the local economy, but American Quilt also includes
workers in local government, service, construction, communication, and utilities.

. Crossroads: Growing communities in small towns, median age of 32.1, and
population growing 1.6% annually. Crossroads consumers are mindful of their
expenses, shop at discount stores, and families are their main priority.
Sutcliffe CDP Trade Area
The Sutcliffe CDP has 193 households which fall into the same category as the Wadsworth CDP.
The only Life Mode Group in this CDP is “American Quilt,” with one sub-grouping being
“Crossroads.” A full description of this sub-group is shown in Appendix A.

American Quilt: Households in small towns and rural areas. Manufacturing and
agriculture remain part of the local economy, but American Quilt also includes
workers in local government, service, construction, communication, and utilities.
13

Crossroads: Growing communities in small towns, median age of 32.1, and population
growing 1.6% annually. Crossroad consumers are mindful of their expenses, shop at
discount stores, and families are their main priority.
Fernley CDP Trade Area
The Fernley CDP has 7,314 households. The Fernley CDP includes the new Life Mode Group
“Upscale Avenues,” containing 59.0% of the total CDP area households in addition to
“American Quilt,” which contains 41.0% of total CDP households.
These categories are described as below:

Upscale Avenue: Prosperity is the overriding attribute of this Life Mode segment.
Residents have earned their prosperity through years of hard work. This group is well
educated with above average earnings. The median household income is $70,720 with
median net worth of $188,740.

American Quilt: Households in small towns and rural areas. Manufacturing and
agriculture remain part of the local economy, but American Quilt also includes
workers in local government, service, construction, communication, and utilities.
Within these Life Mode Groups, Fernley CDP neighborhoods are further classified into three
of the 65 detailed sub-groupings. The sub-unit group under “Upscale Avenue” is “Green
Acres,” while the sub-groups under “American Quilt” are “Midland Crowd” and
“Crossroads.” An abridged ESRI description of these sub-groupings is below. For a full
description see Appendix A.
These categories are described below:

Green Acres: Many families are blue-collar Baby Boomers and many have children
ages 6 to 17 years of age. The median age is 40.7 years of age with a quarter of the
people in this group have bachelors or advanced degrees with over half having
attended college. Labor force participation rate is approximately 68% with
employment concentrated in manufacturing, construction, health care and retail trade.

Midland Crowd: This is a growing population segment with 12 million people or
approximately 4% of the national population. The median age of this group is 37 years.
Sixty-two percent of these households are married couples and half of them have
children. Median household income is $50,518 slightly lower than U.S. median value.
Half of the residents hold white collar jobs with 45% of residents 25 years and older
having attended college with 16% graduating with a bachelor’s or graduate degree.

Crossroads: Growing communities in small towns, median age of 32.1, and population
growing 1.6% annually. Crossroads consumers are mindful of their expenses, shop at
discount stores, and families are their main priority.
14
Estimation of Demand for Pyramid Lake Child Care Facility
In conversations with personnel at the Pyramid Lake Tribal Office and Pyramid Lake Child Day
Care, it was decided to estimate current and future demand for services for the trade area. By
using the EXCEL spreadsheet alternative capture of demand from the four CDP areas could be
analyzed. The population for the four CDPs was collected from the 2010 Census. From the ESRI
data base, projected annual growth rates for population to 2015 were used to forecast future child
care demand.
From ESRI, average annual growth rates for the four CDPs were derived. For the Nixon,
Wadsworth, Sutcliffe, and Fernley CDP area, average annual population growth rate was
forecasted to be 1.76%, 1.75%, 1.77%, and 4.00%, respectively. Also using data from ESRI, the
proportional share of CDP population by age was derived for 2010 and 2015 (Appendix B).
Following conversations with Pyramid Lake Child Care personnel, the age groups were divided
into five segments: infants under one year of age; infants between 1 and 2 years; toddlers age 2
to 3; pre-school children aged 3 to 5; and school age children from 5 to 12 years old.
Using population forecast and forecasts of proportional share of population by CDP, Tables 5
and 6 are estimated. Table 5 shows estimated population by age group by CDP for 2010.
Table 5. Estimated Population by Age Group and CDP, 2010
CDP Areas, 2010
Age group
Nixon Wadsworth Sutcliffe Fernley
Infant 0-1 years
6
13
4
271
Infant 1-2 years
9
19
6
407
Toddler 2-3 years
6
14
4
271
Pre-school 3-5 years
13
30
9
571
School age 5-12 years
45
97
30
2,218
Total
79
173
53
3,738
Total
293
440
296
624
2,390
4,043
From Table 5, total population demand for the age groups by CDP is 4,043. The analysis would
entail an assumption of percentage captured of each age group by CDP and accompanying fee to
derive revenue. However, populations change through time and Table 6 shows estimate
population by age group and CDP in 2015.
15
Table 6. Estimated Population by Age Group and CDP, 2015
CDP Areas, 2015
Age group
Nixon Wadsworth Sutcliffe Fernley
Infant 0-1 years
6
14
4
330
Infant 1-2 years
10
20
6
495
Toddler 2-3 years
7
15
5
330
Pre-school 3-5 years
15
33
10
660
School age 5-12 years
48
105
32
2,663
Total
85
187
57
4,477
Total
354
530
357
717
2,847
4,806
From table 6, total trade area population for child care increases to 4,806 by 2015. However for
feasibility analysis, the percentage of capture for each age group by CDP needs to be assumed.
Then by estimating the amount of revenue per child, revenue estimates can be derived for the
feasibility analysis.
Capture Rate and Forecasted Attendance
For this section a competitive market and capture rate analysis will be completed. These
analyses will provide information as to potential viability of a child care center in Wadsworth.
Competitive Market
The proposed Wadsworth child care center will compete with other child care operations in the
region. Table 7 shows the number of existing child care facilities open to the public in the CDP
areas. Currently, Fernley has three child care facilities open to the public to service the region’s
3,738 children under the age of 12. A ratio of number of children in Fernley CDP under the age
of 12 divide by three child care operations yields 1,246 children per facility. Nixon has one child
facility to serve its 79 children, for a ratio of 79 children per facility. At the present, Sutcliffe
does not have a child care center to serve their 173 and 53 child residents, respectively. This
again highlights the potential demand for additional child care services in the region.
16
Table 7. Existing Child Care Centers in CDP Areas and Child Population, 2010.
CDP Areas, 2010
Statistic
Nixon Wadsworth Sutcliffe
1 to 4 employees
0
0
0
5 to 9 employees
1
0
0
10 to 19 employees
0
0
0
Total child care centers
1
0
0
Children age 12 and under in CDP, 2010
79
173
53
Children per child care center in CDP, 2010
79
----Source: U.S. Census, County Business Patterns, Washington, DC, 2011.
Fernley
1
1
1
3
3,738
1,246
Constant Capture Rate Analysis
Little Warrior Learning Center attendance records for each of the four CDP’s for each of the five
age groups was collected. From Table 8, the majority of children attending the Learning Center
are from Wadsworth and there were no children in attendance from Sutcliffe. Eleven were from
Nixon while six were from Fernley.
Table 8. Current Little Warriors Learning Center Attendance by CDP, 2011.
Age group
Infant 0-1 years
Infant 1-2 years
Toddler 2-3 years
Pre-school 3-5 years
School age 5-12 years
Total
Nixon
2
1
1
6
1
11
CDP Areas, 2010
Wadsworth Sutcliffe Fernley
2
0
0
3
0
1
2
0
1
8
0
2
12
0
2
27
0
6
Total
4
5
4
16
15
44
From tables 5 and 6, the current attendance information was divided by the number of children in
each age group living in a selected CDP. This division yields Table 9 which shows the capture
rate of the Little Warrior Learning Center for each age class by CDP. From Table 9
approximately 44% of the Nixon CDP pre-school children with ages 3 to 5 attend the Little
Warrior Learning Center. Also Table 9 shows that although more than twice the number of
Learning Center students is from Wadsworth than from Nixon, a greater proportion of Nixon’s
children attend the Little Warrior Learning Center.
17
Table 9. Current Proportional Shares or Capture rates of Children by Age Group
From Alternative CDPs Attending Little Warrior Learning Center, 2011.
Age group
Infant 0-1 years
Infant 1-2 years
Toddler 2-3 years
Pre-school 3-5 years
School age 5-12 years
Nixon
0.334
0.116
0.157
0.446
0.022
CDP Areas, 2010
Wadsworth Sutcliffe
0.160
0.000
0.156
0.000
0.141
0.000
0.270
0.000
0.124
0.000
Fernley
0.000
0.002
0.004
0.004
0.001
Using information from Table 9 and projected 2015 population for each age group, a predicted
number of children that would be captured by the new Wadsworth facility could be estimated.
This assumes a similar capture rate as the current Little Warriors Learning Center. Table 10
shows the predicted attendance from projected 2015 population. If capture rates stay the same,
the number of children captured by the proposed Wadsworth facility would increase by three
students.
Table 10. Estimated Little Warrior Learning Center Attendance by CDP in 2015.
Age group
Infant 0-1 years
Infant 1-2 years
Toddler 2-3 years
Pre-school 3-5 years
School age 5-12 years
Total
Nixon
2
1
1
7
1
12
CDP Areas, 2015
Wadsworth Sutcliffe Fernley
2
0
0
3
0
1
2
0
1
9
0
2
13
0
2
29
0
7
Total
4
5
4
18
16
48
From information provided by Little Warrior Learning Center, the tuition rates by age group are
shown below. For our analysis the per students rates will be for children 12 weeks to 1 year at
$130 per week, child 1 to 2 years at $125 per week, Child 2 to 3 years of age at $100 per week,
child 3 to 5 years of age at $90 per week, and child 4 to 12 years of age at $50 per week. The
schedule of charges is shown below in Table 11.
18
Table 11. Per Week Per Child Revenue Charges.
____________________________________________________________________
Ages
Tuition Rate
Full-time
Part-time
____________________________________________________________________
12wks-1yr
$130.00
N/A
1-2
$125.00
N/A
2-3
$100.00
$65.00
3-5
$
$90.00
$55.00
5-12
Before school only-$10.00
Before/After School $50
School breaks (F/T) $90.00 (P/T) $55.00
____________________________________________________________________
Using data from Tables 10 and Tables 11, a weekly revenue forecast can be made. Table 12
shows the revenue forecasts using similar capture rates for the Little Warrior Learning Center for
the Wadsworth proposed Center. Total weekly revenues are forecasted to be $3,965.
Table 12. Revenue Forecast Per Week for the Proposed Child Care Center in Wadsworth.
Age group
Infant 0-1 years
Infant 1-2 years
Toddler 2-3 years
Pre-school 3-5 years
School age 5-12 years
Total
Nixon
$ 260.00
$ 125.00
$ 100.00
$ 630.00
$ 50.00
$ 1,165.00
CDP Areas, 2015
Wadsworth Sutcliffe Fernley
$ 260.00 $
$
$ 375.00 $
$ 125.00
$ 200.00 $
$ 100.00
$ 810.00 $
$ 180.00
$ 650.00 $
$ 100.00
$ 2,295.00 $
$ 505.00
Total
$ 520.00
$ 625.00
$ 400.00
$ 1,620.00
$ 800.00
$ 3,965.00
For sensitivity analysis assume with the location of the Wadsworth Child Care Center, the ability
to capture Fernley children increases by 0.1%. This would change the Fernley capture rate in
Table 9 and number of children captured by 5 people as shown in Table 13. The new rates,
children captured, and revenues are shown in Table 13. From Table 13, total revenues for the
proposed Wadsworth Child Care Center would increase by $465 per week. Therefore it might be
beneficial for the tribe to target children in Fernley
19
Table 13. Revised Capture Rate, Children Attending, and Revenues from Additional
Capture from Fernley at the Wadsworth Child Care Facility.
Age Group
Fernley Revised Revised Fernley Revised Fernley
Capture Rate
Attendance
Revenues
Infant 0-1 Years
0.001
0
0
Infant 1-2 Years
0.003
2
250
Toddler 2-3 Years
0.005
2
200
Pre-School 3-5 Years
0.005
3
270
School Age 5 to 12 Years
0.002
5
250
TOTAL
12
970
CONCLUSIONS
Nationally with the growth of working two-parent families and single-parent families, the need
for child care in urban and rural areas of the nation is evident. This study will complete a market
analysis of a potential child care facility in Wadsworth, Nevada.
For this market analysis, four Census Designated Places (CDP’s) will be used. These four
CDP’s are Nixon, Wadsworth, Sutcliffe, and Fernley. From the 2010 Census, population in the
Nixon CDP decreased by 44 people, population in the Wadsworth CDP declined by 47 people
from 2000 to 2010, population in the Sutcliffe CDP declined by 28 people from 2000 to 2010
while for the Fernley CDP population increased by 10,825 persons from 2000 to 2010. It is
evident that the Fernley CDP is growing at a rapid rate and should be a considered target area for
the proposed Wadsworth child care facility.
In order to effectively market to these CDP areas, the tribe must be aware of the customer types
that live in these CDP’s and market accordingly. For the Nixon, Wadsworth, and Sutcliffe
CDP’s, these areas have customers in a Life Mode customer classification of American Quilt
with sub-group designated as Crossroads. This customer type is primarily a rural customer
working in agriculture, manufacturing, local government, services, construction, and utilities.
Families with children who are mindful of their expenses represent this customer type. This
customer type is represented by two-parent working families looking for affordable child care.
20
The Fernley CDP being larger has a more diverse customer type. Like the previous three CDP’s,
the Fernley CDP has the American Quilt and Crossroads customer types. Fernley also has
Upscale Avenue customer class which is primarily older families who are retired with higher
than average incomes. Grandparents are represented by this customer class who may demand
child care from time to time. Fernley also has sub-customer groups of Green Acres and Midland
Crowd. The Green Acres customers are blue collar workers with children. They have a high
labor participation rates which means this customer type demands child care services. The
Midland Crowd consumer is a growing consumer segment with half being married couples with
children. This is a two-parent working family that demands child care services. Therefore given
the growing population of Fernley and its consumer types that live in the CDP, the Fernley child
care customer should be targeted by the proposed Wadsworth Child Care Facility.
In order to derive potential feasibility of a proposed child care center in Fernley, a detailed
market capture study was concluded. One area of feasibility is to investigate the competition in
the area. The Fernley CDP has three child care facilities open to the public while the Nixon CDP
has one. Even with three child care centers, the Fernley CDP may need another child care
facility because each child care center in Fernley serves 1,246 children.
Using data from the Little Warrior Learning Center, the capture of children by CDP by age
group was derived. Currently eleven children are from Nixon CDP, 27 from Wadsworth, no
children from Sutcliffe CDP and six from Fernley CDP. Also the Little Warrior Learning Center
provided per child revenue charges per day by age group. With the projected population growth
rates for each CDP from 2010 to 2015, the estimated growth in child care would be from 44 to
48. With this increase in capture, total weekly revenue from the proposed Wadsworth facility by
2015 is estimated to be $3,965.
Given the number of people and children who live in Fernley CDP and if the tribe initiated
marketing strategies that would increase capture of children in all age groups from Fernley CDP
by 0.1%, attendance from Fernley CDP would increase by five children and weekly revenues
would increase by $465. Therefore for any feasibility analysis, marketing strategies to increase
capture of children of all age groups from Fernley CDP maybe a profitable venture.
21
APPENDIX A: DESCRIPTION OF NEIGHBORHOOD TYPES
22
There is one neighborhood type for the Nixon CDP:

100.0% of the households live in neighborhoods that are:
Consumer Type 41: Crossroads
Demographic: Crossroads neighborhoods are growing communities in small towns in the South, Midwest, and
West. Married couples with and without children and single parents are the primary household types in these areas.
Younger than the U.S. average, they have a median age of 32.1 years; nearly half are younger than 45. This
population is growing at 1.6 percent annually, faster than the growth of the U.S. population. One in five is Hispanic,
a higher proportion than the U.S.
Socioeconomic: The median household income is $44,410, somewhat below the U.S. median; the median net worth
is $53,300. Educational attainment is lower than the U.S. average; 37 percent of residents aged 25 years or older
have attended college, compared to 54 percent for the U.S. Most employed residents work in the manufacturing,
retail, construction, and service industries. Labor force participation is comparable to the U.S. level; unemployment
is slightly higher.
Residential: Affordable housing in these small-town communities provides opportunities for young families to own
their homes. Homeownership is 74 percent; the median home value is $62,469, much lower than the U.S. median.
More than half of the housing is mobile homes; 36 percent are single-family dwellings. Most were built after 1969.
Preferences: Mindful of their expenses, Crossroads households budget for what they buy and choose selectively
where to spend their money. They shop at discount department stores such as Wal-Mart and Kmart. Many shop for
groceries at Wal-Mart Supercenters. Their priorities are their families and their cars. Children are the focus of their
lives, and they buy children’s products in addition to groceries. They drive domestic cars and trucks and handle the
maintenance themselves. Investing and saving for retirement are a low priority; many households do not own mutual
funds, stocks, or retirement savings accounts. Home improvement projects also rank low. They watch NASCAR
racing and other sports on TV. Typically, they own a satellite dish or subscribe to cable. They also like to listen to
the radio, preferring country and contemporary hit music to other formats. They read the newspaper less frequently
than average U.S. households; however, they read magazines, especially automotive, boating, motorcycle, and
fishing publications. They go fishing and watch movies on DVD.
23
There is one neighborhood type for the Wadsworth CDP:

100.0% of the households live in neighborhoods that are:
Consumer Type 41: Crossroads
Demographic: Crossroads neighborhoods are growing communities in small towns in the South, Midwest, and
West. Married couples with and without children and single parents are the primary household types in these areas.
Younger than the U.S. average, they have a median age of 32.1 years; nearly half are younger than 45. This
population is growing at 1.6 percent annually, faster than the growth of the U.S. population. One in five is Hispanic,
a higher proportion than the U.S.
Socioeconomic: The median household income is $44,410, somewhat below the U.S. median; the median net worth
is $53,300. Educational attainment is lower than the U.S. average; 37 percent of residents aged 25 years or older
have attended college, compared to 54 percent for the U.S. Most employed residents work in the manufacturing,
retail, construction, and service industries. Labor force participation is comparable to the U.S. level; unemployment
is slightly higher.
Residential: Affordable housing in these small-town communities provides opportunities for young families to own
their homes. Homeownership is 74 percent; the median home value is $62,469, much lower than the U.S. median.
More than half of the housing is mobile homes; 36 percent are single-family dwellings. Most were built after 1969.
Preferences: Mindful of their expenses, Crossroads households budget for what they buy and choose selectively
where to spend their money. They shop at discount department stores such as Wal-Mart and Kmart. Many shop for
groceries at Wal-Mart Supercenters. Their priorities are their families and their cars. Children are the focus of their
lives, and they buy children’s products in addition to groceries. They drive domestic cars and trucks and handle the
maintenance themselves. Investing and saving for retirement are a low priority; many households do not own mutual
funds, stocks, or retirement savings accounts. Home improvement projects also rank low. They watch NASCAR
racing and other sports on TV. Typically, they own a satellite dish or subscribe to cable. They also like to listen to
the radio, preferring country and contemporary hit music to other formats. They read the newspaper less frequently
than average U.S. households; however, they read magazines, especially automotive, boating, motorcycle, and
fishing publications. They go fishing and watch movies on DVD.
24
There is one neighborhood type for the Sutcliffe CDP:

100.0% of the households live in neighborhoods that are:
Consumer Type 41: Crossroads
Demographic: Crossroads neighborhoods are growing communities in small towns in the South, Midwest, and
West. Married couples with and without children and single parents are the primary household types in these areas.
Younger than the U.S. average, they have a median age of 32.1 years; nearly half are younger than 45. This
population is growing at 1.6 percent annually, faster than the growth of the U.S. population. One in five is Hispanic,
a higher proportion than the U.S.
Socioeconomic: The median household income is $44,410, somewhat below the U.S. median; the median net worth
is $53,300. Educational attainment is lower than the U.S. average; 37 percent of residents aged 25 years or older
have attended college, compared to 54 percent for the U.S. Most employed residents work in the manufacturing,
retail, construction, and service industries. Labor force participation is comparable to the U.S. level; unemployment
is slightly higher.
Residential: Affordable housing in these small-town communities provides opportunities for young families to own
their homes. Homeownership is 74 percent; the median home value is $62,469, much lower than the U.S. median.
More than half of the housing is mobile homes; 36 percent are single-family dwellings. Most were built after 1969.
Preferences: Mindful of their expenses, Crossroads households budget for what they buy and choose selectively
where to spend their money. They shop at discount department stores such as Wal-Mart and Kmart. Many shop for
groceries at Wal-Mart Supercenters. Their priorities are their families and their cars. Children are the focus of their
lives, and they buy children’s products in addition to groceries. They drive domestic cars and trucks and handle the
maintenance themselves. Investing and saving for retirement are a low priority; many households do not own mutual
funds, stocks, or retirement savings accounts. Home improvement projects also rank low. They watch NASCAR
racing and other sports on TV. Typically, they own a satellite dish or subscribe to cable. They also like to listen to
the radio, preferring country and contemporary hit music to other formats. They read the newspaper less frequently
than average U.S. households; however, they read magazines, especially automotive, boating, motorcycle, and
fishing publications. They go fishing and watch movies on DVD.
25
There are three (3) neighborhood types for the Fernley CDP:

59.0% of the households live in neighborhoods that are:
Consumer Type 17: Green Acres
Demographic: Seventy-one percent of the households in Green Acres neighborhoods are married couples with and
without children. Many families are blue-collar Baby Boomers, many with children aged 6–17 years. With more
than 10 million people, Green Acres represents Tapestry’s third largest segment, currently more than 3 percent of
the U.S. population and growing by 2.2 percent annually. The median age is 40.7 years. This segment is not
ethnically diverse; 92 percent of the residents are white.
Socioeconomic: Educated and hard-working, more than one-fourth of Green Acres residents hold a bachelor’s or
graduate degree; more than half have attended college. Labor force participation is 68 percent, with higher
employment concentrations in the manufacturing, construction, health care and retail trade industry sectors.
Occupation distributions are similar to those of the U.S. Seventeen percent of the households earn income from selfemployment ventures. The median household income is $64,480; the median net worth is $177,629.
Residential: Although Green Acres neighborhoods are located throughout the country, they are found primarily in
the Midwest and South, with the highest concentrations in Michigan, Ohio, and Pennsylvania. A “little bit country,”
these residents live in pastoral settings of developing suburban fringe areas. Homeownership is at 86 percent, and
median home value is $181,705. Typical of rural residents, Green Acres households own multiple vehicles; 78
percent own two or more vehicles.
Preferences: Country living describes the lifestyle of Green Acres residents. Pet dogs or cats are considered part of
the family. These do-it-yourselfers maintain and remodel their homes; projects include roofing and installing carpet
or insulation. They own all the necessary power tools, including routers, welders, sanders, and various saws, to
finish their projects. Residents also have the right tools to maintain their lawns, flower gardens, and vegetable
gardens. They own riding lawn mowers, garden tillers, tractors, and even separate home freezers for the harvest.
Continuing the do-it-yourself mode, it is not surprising that Green Acres is the top market for owning a sewing
machine. A favorite pastime is using their ice cream maker to produce homemade ice cream. They prefer
motorcycles and full-size pickup trucks. For exercise, Green Acres residents ride their mountain bikes and go
fishing, canoeing, and kayaking. They also ride horseback and go power boating, bird watching, target shooting,
hunting, motorcycling, and bowling. They listen to auto racing and country music on the radio and read fishing and
hunting magazines. Many own satellite dishes so they can watch news programs, the Speed Channel, and auto
racing on TV. A favorite channel is Country Music Television.

25.4% of the households live in neighborhoods that are:
Consumer Type 26: Midland Crowd
Demographic: The growing population of 12 million, approximately 4 percent of the U.S. population, identifies
Midland Crowd as Tapestry’s largest segment. Since 2000, the population has grown by 2.4 percent annually. The
median age of 37 years parallels that of the U.S. median. Sixty-two percent of the households are married couple
families; half of them have children. Twenty percent of the households are singles who live alone. Midland Crowd
neighborhoods are not diverse.
Socioeconomic: Median household income is $50,518, slightly lower than the U.S. median. Most income is earned
from wages and salaries; however, self-employment ventures are slightly higher for this segment than the national
average. The median net worth is $89,749. Unemployment is below average. Half of the residents who work hold
26
white collar jobs. More than 45 percent of the residents aged 25 years and older have attended college; 16 percent
have earned a bachelor’s or graduate degree.
Residential: Midland Crowd residents live in housing developments in rural villages and towns throughout the
U.S., mainly in the South. Three-fourths of the housing was built after 1969. The homeownership rate is 82 percent,
higher than the national rate of 66 percent. The median home value is $124,088. Two-thirds of the housing is singlefamily houses; 28 percent are mobile homes.
Preferences: These politically active, conservative residents vote, work for their candidates, and serve on local
committees. Their rural location and traditional lifestyle dictate their product preferences. A fourth of the households
own three or more vehicles; they typically own or lease a truck, and many own a motorcycle. Proficient do-ityourselfers, they work on their vehicles, homes, and gardens and keep everything in tip-top shape. They hunt, fish,
and do woodworking. Dogs are their favorite pets. They patronize local stores or shop by mail order. They have
recently bought radial tires. They often go to the drive-through at a fast-food restaurant. Many households own a
satellite dish so they can watch CMT, the Speed Channel, Home & Garden Television, NASCAR racing, rodeo/bull
riding, truck and tractor pulls, fishing programs, and a variety of news programs. They listen to country music on the
radio and read fishing and hunting magazines.

15.6% of the households live in neighborhoods that are:
Consumer Type 41: Crossroads
Demographic: Crossroads neighborhoods are growing communities in small towns in the South, Midwest, and
West. Married couples with and without children and single parents are the primary household types in these areas.
Younger than the U.S. average, they have a median age of 32.1 years; nearly half are younger than 45. This
population is growing at 1.6 percent annually, faster than the growth of the U.S. population. One in five is Hispanic,
a higher proportion than the U.S.
Socioeconomic: The median household income is $44,410, somewhat below the U.S. median; the median net worth
is $53,300. Educational attainment is lower than the U.S. average; 37 percent of residents aged 25 years or older
have attended college, compared to 54 percent for the U.S. Most employed residents work in the manufacturing,
retail, construction, and service industries. Labor force participation is comparable to the U.S. level; unemployment
is slightly higher.
Residential: Affordable housing in these small-town communities provides opportunities for young families to own
their homes. Homeownership is 74 percent; the median home value is $62,469, much lower than the U.S. median.
More than half of the housing is mobile homes; 36 percent are single-family dwellings. Most were built after 1969.
Preferences: Mindful of their expenses, Crossroads households budget for what they buy and choose selectively
where to spend their money. They shop at discount department stores such as Wal-Mart and Kmart. Many shop for
groceries at Wal-Mart Supercenters. Their priorities are their families and their cars. Children are the focus of their
lives, and they buy children’s products in addition to groceries. They drive domestic cars and trucks and handle the
maintenance themselves. Investing and saving for retirement are a low priority; many households do not own mutual
funds, stocks, or retirement savings accounts. Home improvement projects also rank low. They watch NASCAR
racing and other sports on TV. Typically, they own a satellite dish or subscribe to cable. They also like to listen to
the radio, preferring country and contemporary hit music to other formats. They read the newspaper less frequently
than average U.S. households; however, they read magazines, especially automotive, boating, motorcycle, and
fishing publications. They go fishing and watch movies on DVD.
27
APPENDIX B: PROPRTIONATE SHARE OF POPULATION BY
AGE FOR FOUR CDP AREAS
28
Table 1.B Proportionate Share of Total Zip Code Population By Age, 2010
Age group
Infant 0-1 years
Infant 1-2 years
Toddler 2-3 years
Pre-school 3-5 years
School age 5-12 years
Total
CDP Areas, 2010
Nixon Wadsworth Sutcliffe
1.60%
1.50%
1.50%
2.30%
2.30%
2.35%
1.70%
1.70%
1.70%
3.60%
3.55%
3.70%
12.00%
11.65%
11.85%
21.20%
20.70%
21.10%
Fernley
1.40%
2.10%
1.40%
2.95%
11.45%
19.30%
Table2.B Proportionate Share of Total Zip Code Population By Age, 2015
Age group
Infant 0-1 years
Infant 1-2 years
Toddler 2-3 years
Pre-school 3-5 years
School age 5-12 years
Total
CDP Areas, 2015
Nixon Wadsworth Sutcliffe
1.50%
1.50%
1.50%
2.35%
2.15%
2.25%
1.70%
1.70%
1.70%
3.70%
3.60%
3.50%
11.65%
11.55%
11.45%
20.90%
20.50%
20.40%
29
Fernley
1.40%
2.10%
1.40%
2.80%
11.30%
19.00%
References:

ESRI Business Information Solutions, 2010 Estimates and Projections, www.esribis.com.,
2011.
30