Transcript Chapter 6 Advertising

Chapter 6
Market Segmentation and the Marketing
Mix: Determinants of Advertising Strategy
William F. Arens
McGraw-Hill/Irwin
Michael F. Weigold
Christian Arens
Copyright © 2013 by The McGraw-Hill Companies, Inc. All rights reserved.
Charles Finney (1792-1875)
Chapter Overview
How marketers use
behavioral characteristics
to cluster perspective
customers into market
segments
6-3
Chapter Objectives
Define market
segmentation and
describe its purposes
Explain the target
marketing process
Show how IMC is used
with the product element
in marketing
Illustrate how IMC is
used with the price
element in marketing
Review how IMC is used
with the place element in
marketing
Discuss how IMC is used
with the communication
element in marketing
6-4
Old Spice/W+K
 Isaiah Mustafa – Shower
 Isaiah Mustafa – Scent
 New Old Spice Guy Fabio
 Terry Crews
6-5
The Market Segmentation
Process
1. Identify people with
shared needs and
characteristics
6-6
The Market Segmentation
Process
1. Identify people with
shared needs and
characteristics
2. Aggregate these
groups into market
segments according
to their mutual interest
in the product’s utility
6-7
Q. 1. Define Market Segmentation.
The Market Segmentation Process
1. The division of the
market into homogenous
groups
2. Aggregate these
groups into market
segments according
to their mutual interest
in the product’s utility
Shared Characteristics
Categories
Behavioristic
Demographic
Geographic
Psychographic
6-9
Segmenting Consumer Markets
6-10
Q. 2. What are the four bases for
segmenting markets?
Behavioristic Segmentation
User-Status
Purchase-Occasion
Sole Users
Semi-Sole Users
Discount Users
Aware Non-triers
Trial/Rejectors
Repertoire Users
Usage-Rate
Volume
Segmentation
Benefits-Sought
Benefit
Segmentation
6-12
Market Segmentation
User status:
Mammut ad
targets its
repertoire users
who are
concerned with
quality
Insert photo 6.4, p. 171
Mammut ad
Position = 2.9“ horizontal, 1.5“ vertical
Size = 5.7” WIDE
Resolution = 300 dpi
6-13
Market Segmentation
Purchase
occasion:
Columbia
seasonal gear
ad
Insert photo 6.5, p. 172
Columbia sportswear ad
Position = 2.9“ horizontal, 1.5“ vertical
Size = 5.7” WIDE
Resolution = 300 dpi
6-14
Geographic Segmentation
Sales are analyzed by:





Region
Country size
City size
Zip code
Types of stores
6-15
Demographic Segmentation
6-16
Demographic Segmentation
6-17
Psychographic Segmentation
Feelings
Values
Lifestyles
Personality
Attitudes
6-18
Market Segmentation
Adidas captures
attitude and
lifestyle
6-19
Target Market Selection
HarleyDavidson ad
appeals to likely
customers who
want to stand
out in the
ordinary
6-20
Insert photo 6.10, p. 186
Harley-Davidson ad
Position = 2.9” horizontal, 1.5” vertical
Size =5.7” WIDE
Resolution = 300 dpi
6-20
Psychographic Segmentation
6-21
Psychographic Segmentation
10 values
shared by
people
around the
world
6-22
Psychographic Segmentation
MindBase finds shared patterns of behavior
6-23
Segmentation Profile
 Our customer is:
 Male who lives in the East
 In an urban city of 1 million people
 Young, married (ages 35-49) with a child
 Annual income between $50,000 - $100,000
 Is a college graduate who is a professional
 Is white, upper lower class, ambitious
 Sports minded and brand conscious
6-24
Business, Government, & Industry
Professional
buyers
Differences
from Consumer
Markets
Many purchase
decision factors
Concentrated
geographically
Small number
of buyers
Categorized by
NAICS code
6-25
Business, Government, & Industry
6-26
Market Concentration
Note the
importance of
the Midwest and
California to
manufacturing
marketing
6-27
Aggregating Market Segments
Select Groups Interested in Public Utility
Whole market
Specific market
Combine Groups to Build Target Market
Segments
Homogeneous
Profit Potential
6-28
Defining the Target Market
6-29
The Target Marketing Process
1. Select a target market from the market
segments identified
2. Use the 4Ps of the marketing mix to shape a
product concept for the market
Product
Price
Place
Promotion
6-30
Target Market Segments
New Empty
Nest
Young
Influentials
Park Bench
Seniors
New
Beginnings
Movers &
Shakers
Bohemian
Mix
Home Sweet
Home
6-31
Q. 3. Define Product Concept.
Product Concept
Consumer’s perception of a product as a bundle of
utilitarian and symbolic values that satisfy
functional, social, psychological, and other wants
and needs.
6-33
Q. 4. Explain the relationship between
advertising and the Product element
of the marketing mix.
Product Life Cycles
6-35
The Product Element
Classification
by…
Positioning
Market
Own a word
Consumption rate
Benefits offered
Tangibility
Market segment
appeal
Buying habits
Classification
Physical description
Differentiation
6-36
The Product Element
Volvo positions itself as owning safety
6-37
The Product Element
Differentiation
Perceptible
Hidden
Induced
6-38
Product Branding
Goal is brand loyalty
Product
Name
Words
Design
Symbols
Individual
Family
National
Private
Licensed
6-39
The Product Element
World’s most
valuable brands
http://www.
businesswe
ek.com/ma
gazine/toc/
06_32/B39
9606global
brands.htm
Insert ex. 6.14, p. 193
World’s most valuable brands
Position = 2.9” horizontal, 1.5” vertical
Size = 5.7” WIDE
Resolution = 300 dpi
6-40
The Most Valuable Brands
6-41
Product Packaging
Identification
Consumer
appeal
Containment,
protection,
convenience
Economy
These functions may become copy points
6-42
Q. 5. Explain the relationship between
advertising and the Price element of
the marketing mix.
The Price Element
Price Factors:
Demand
Production &
distribution
costs
Competition
Corporate goals
& strategies
Variable
influences
6-44
Q. 6. Explain the relationship between
advertising and the Place element of
the marketing mix.
The Place (Distribution) Element
Direct
Indirect
Vertical
Network
Intensive
Franchises
Buyer Club
Selective
Exclusive
6-46
Q. 7. Explain the relationship between
advertising and the Promotion
element of the marketing mix.
The Promotion Element
Personal
Selling
Direct
Marketing
Public
Relations
Product
Advertising
Communication
Mix
Sales
Promotion
Collateral
Materials
6-48
Hardees Commercial