Transcript chapter 7 - Cengage Learning

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CHAPTER
7
COMPETITION IS
EVERYWHERE
7-1 Focusing on Market Segments
7-2 Positioning for Competitive
Advantage
7-3 Competing for Market Segments
7-4 Learning about the Competition
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MARKETING
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Courtesy of PJ Madison’s. Used with permission.
Focus Questions:
 In what ways is PJ Madison’s
trying to suggest its ice cream
is different and better than
other brands?
 What types of consumers do
you believe will be attracted to
the advertisement?
 In your view, is the ad effective
at encouraging customers to
try PJ Madison’s ice cream?
Why or why not?
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7-1
FOCUSING ON
MARKET SEGMENTS
GOALS
Describe how markets can be
segmented by geographic location,
demographic characteristics,
psychographics, product usage, and
benefits derived.
Explain how to evaluate market
potential and calculate market share.
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Market Segmentation
The benefits of segmentations
Segmentation categories
 Geographic segmentation
 Demographic characteristics
 Psychographics
 Product usage
 Benefit expectations
Segmenting the business market
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Demographic Characteristics of
Education and Income
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Identifying and Analyzing
Market Segments
Identifying Possible Segments
Determining Market Potential
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Determining Market Potential
1. Number of potential customers
2. Interest in the product or service and
other mix elements
3. Money available to make the purchase
4. Ability to communicate with and
distribute product to consumers
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Market Potential
Market potential is the total revenue that
can be obtained from the market
segment.
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Market Share
Market share is the portion of the total
market potential that each company
expects to get in relation to its
competitors.
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7-2
POSITIONING FOR
COMPETITIVE ADVANTAGE
GOALS
Explain the various bases for
positioning a product to distinguish it
from the competition.
Describe the three common positioning
strategies.
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Basis for Positioning
Attribute
Price and quality
Use or application
Product user
Product classification
Competitor
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Market Position
Laundry Product A
Laundry Product B
Attribute
Cleans quickly and
easily
Leaves fresh scent
Price and
Quality
Low price, good value
Higher price for highest
quality
Use or
Application
Use as pre-wash on
tough stains
Use for hand-washing
delicates
Product User
Homemaker’s reliable
friend
New generation’s
discovery
Product
Classification
Used by Olympic
athletes
Used by professional
laundries
Competitor
Gets out dirt Product B
can’t
Gentler on clothing than
Product A
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Selecting a Positioning Strategy
Consumer perceptions
Competition
Business environment
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7-3
COMPETING FOR
MARKET SEGMENTS
GOALS
Explain direct vs. indirect competition
and price vs. non-price competition.
Describe the benefits of competition to
consumers.
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Types of Competition for
Positioning Decisions
Direct competition
Indirect competition
Price competition
Non-price competition
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Benefits of Competition
 Consumer receives the best price for products.
 Competition encourages improvements in
products with the addition of unique features
and benefits.
 Businesses are always looking for new and
improved products to match their competition.
 Competition offers consumers the benefit of a
wide variety of products from which to choose.
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7-4
LEARNING ABOUT
THE COMPETITION
GOALS
Discuss the types of information
businesses need to know about their
competitors.
Describe the kinds of activities
businesses engage in to gain marketing
intelligence.
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Types of Competitive Information
Pricing strategies
Distribution decisions
Product/Service planning
Promotional efforts
Competitor’s market position
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Collecting Competitive
Information
 Information sources
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Salespeople and other employees
Analysis of competitors’ products.
Articles, research reports, and public information
Professional and trade publications
Customers and customer records
Trade shows
The Internet
 Ethics in information gathering
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