Transcript Market Segmentation

Unit 3
Marketing
Learning Objectives
 To define marketing and explain the elements of
marketing
 To understand the functions of marketing and the
marketing mix
 To discuss the way of market segmenting and
targeting
Can you recognize which company it is
from the following website?
Can you name some of the household
products of IBM?
Have you ever thought of why IBM
could be so popular all of the world?
IBM has undergone a remarkable
transformation. All top IBM
managers met face-to-face with
important customers and report back
their problems and priorities.
What are Consumer’s Needs,
Wants and Demands?
Needs - state of felt deprivation for basic items such
as food and clothing and complex needs such as for
belonging. i.e. I am hungry.
 Wants - form that a human need takes as shaped by
culture and individual personality. i.e. I want a
hamburger, French fries, and a soft drink.
 Demands - human wants backed by buying power.
i.e. I have money to buy this meal.

The scope of marketing
In fact, marketing people are involved in marketing 10
types of entities:
- Goods 商品
- Services 服务
- Experiences 经历
- Events 事件
- Persons 个人
- Places 地点
- Properties 财产权
- Organizations 组织
- Information 信息
- Ideas 观念
What Will Satisfy Consumer’s
Needs and Wants?
Products
Anything that can be Offered to a Market to Satisfy a Need or Want
Experiences
Persons
Organizations
Information
Services
Places
Ideas
Activities or Benefits Offered for Sale That Are Essentially
Intangible and Don’t Result in the Ownership of Anything
Modern Marketing System (Fig.
1-3)
Suppliers
Company
(Marketer)
Marketing
Intermediaries
End User
Market
Environment
Environment
Competitors
Developing the Marketing Mix
Price
Product
Amount of money
that consumers
have to pay to
Obtain the product
“Goods-and-service”
combination that a
company offers a
target market
Target
Customers
Intended
Positioning
Activities that
persuade target
customers to buy
the product
Promotion
Company activities
that make the
product available
Place
Oral Practice
An interview
A: a host of an economic TV program
B: an expert on marketing
 A: From June 10th to July 10th, the football
has been the focus of the world during these
30 days. The accumulated number of
audience to these 64 matches has reached
about 320,000,000,000, this is a great festival
the World Cup brings to us. However, there
has been another world cup in the eyes of
business men, and those games are more
intensive, more fierce and crueler, of course,
they are real matches. This is the war of
marketing which revolves around the World
Cup.
 B: Everyone who watches the World Cup can
definitely feel that not only the players are
trying to win the game, the team sponsors are
fighting outside of the grassland.
 A: There are three famous sports brands:
Adidas, Nike and Puma, they choose different
football teams to support, which one do you
think has made a brilliant decision?
 B: In my opinion, I agree more on Puma.
 A: May I know your reason?
 B: In football games, people prefer to focus
on Black Horse, I think Puma has acted as a
Black Horse. It firstly launched in the African
teams, which is a potential market for sports
brands, this strategy not only grasp a big
emerging market but also very economic.
 A: We hope Puma can really grasp this new
market and make great achievements. The
World Cup for football comes every four
years, however, the competition on marketing
on football or we can call it as a war because
it may be more violent, will never end. It is
even a start for most Chinese enterprises,
because we will play a real home game in
2008.
Text One
An Overview of Marketing
Vocabulary
availability n. 可用性
E.g.:local availabilities
可从当地获得的东西。
the availability of a candidate
候选人的当选可能性。
solution n.解决方案
E.g.: He came up with a really elegant
solution to our problem.
他给我们的问题想出了一个很棒的解决
方案。
categorize vt. 分类, 归类
E.g.: If you categorize the information you
need to remember， you will find it much
easier.
如果你把所需记忆的信息分类，你就会
觉得记忆起来要容易得多。
priority n. 优先考虑的事
It’ll take three months to repair the house.
Now patience is something should be a
priority .
这个房子装修要三个月，所以耐心是最
重要的。
 promotion n. 推销商品
 E.g.:
 A: What is the next step following the promotion
campaign?
B: I guess you need to find someone who can
bankroll you.
A: 推销战之后要做什么？
B: 我想你需要有人来资助你。
conception n. 概念
E.g.: This concept is at the very core of her
theory.
这个概念是她的理论的核心.
I can not understand the so abstract
concept.
我无法理解如此抽象的观念。
split off 分开
E.g.:The road splits off from the main
street.
这条路从大街上岔了出来。
tailor-made adj. 定制的, 适合的
E.g.:He seems tailor-made for the job.
他好像很适合这项工作。
brochure n. 宣传册
E.g.: I'll send you the brochure right
away.
我会把公司简介即刻给您寄去。
The travel brochure lured me into taking a
Caribbean vacation.
这本旅游小册子诱使我去加勒比地区度
假。
modify vt. 更改
E.g.: The policy was agreed by the
committee, but only in a modified form.
那项政策经修改后才获得委员会同意。
He'll have to modify his views if he wants
to be elected.
他要想当选就得把观点改得缓和些.
Explanation of the text
The American Marketing Association
defines marketing as “the process of
planning and executing the conception,
pricing, promotion, and distribution of
ideas, goods, and services to create
exchanges that satisfy individual and
organizational goals.”
美国市场营销协会将市场营销的定义为：
计划和执行观念，商品和服务的构思，
定价、促销和分销以便产生满足个人、
组织和社会目标的交易的过程。
The word “create” gives marketing an
anticipatory dimension and emphasizes the
forward-looking approach necessary to
identify future needs and wants.
“创造”一词使得市场营销有了一个可
以预期的空间，并且强调了发展性的眼
光对于确定未来需求的必要性。
 IBM’s marketing managers tried to win over the
game, they have to understand that the customers’
needs are their goals. Without this concept in
mind, they could produce only “white elephants”
which they could sell to nobody. The concept of
“finding the needs of the consumers and
satisfying them” is the essence of marketing, a
word literally meaning “finding a market and
serving it”.
Keys to Exercises
II. Fill in the table below by giving the
corresponding Chinese or English
equivalents.
市场营销
deliver solutions
合适的产品
marketing mix
个人推销
pricing
促销
demand for consumption
III. Choose one suitable answer from the
following four choices to answer the
question or to complete the sentence.
B A D D A
IV. Practical Writing

The genius XXX Home Appliance
Company has come up with a new model
Microwave ovens -EB-3190EG. It can cook
the food with amazing speed by heating the
food. Furthermore its convection facility
provides fans and a certain 'airflow'
circulation that cooks the food by using much
less electricity. It can bake, broil, cook, rethermalize and warm the food effectively
which makes it be the best oven available in
the market that provides the users with
delicious, tasty and fast cooked foods.
 Basic functions of this new model:
 1. Halogen grill
 2. Electronic operation with LED display
 3. 10microwave power levels
 4. 90minutes time setting
 5. Auto menu & auto defrost function
 6. Child lock
 7. Quick start key
Special Features of Microwave Convection
Ovens: this new model is a wonderful
creation. It provides the couple advantages
of microwave methods. There are some
other features too that make this oven so
special.
Baking features - During baking, a heating
element raises the temperature inside the
oven. So, it can operate temperatures from
225- 450F. The fan circulates the hot air
throughout the oven, over the food and
produces brown exteriors and moist
interiors.
Following are some of the other
advantages of microwave convection oven:
There are heating and cooling switches,
which heat and cool the food perfectly. The
nutrients are preserved and the actual taste
of the food also remains same. The oven
operates at much lower temperature and
leads to 20% decrease in cooking time
compared to other ovens.
If you still don't have an excellent
microwave oven like this, then hurry up
and get yourself this oven to provide
wonderful dishes to your family and
friends.
Text Two
Market Selection
Text B
To know what the buyer’s behavior is;
To know how to segment the market
To know the methods of targeting a market
Consumer Buying Behavior
Consumer Buying Behavior refers to the
buying behavior of final consumers individuals & households who buy goods and
services for personal consumption.
All these consumers make up the consumer
market.
The central question for marketers is:
– “How do consumers respond to various marketing
efforts the company might use?”
Factors Influencing
Consumer Behavior
Cultural
Social
Culture
Reference
groups
Subculture
Family
Social
class
Roles
and
status
Personal
Age and
life-cycle
Occupation
Economic
situation
Lifestyle
Personality
and
self-concept
Psychological
Motivation
Perception
Learning
Beliefs and
attitudes
Buyer
Steps in Market Segmentation,
Targeting, and Positioning
Market Segmentation
1. Identify bases for
segmenting the market
2. Develop segment profiles
Market Targeting
3. Develop measure of
segment attractiveness
4. Select target segments
Market positioning
5. Develop positioning for
target segments
6. Develop a marketing
mix for each segment
Step 1. Market Segmentation
Geographic Segmentation
World Region or Country
City or Metro Size
Density or Climate
Step 1. Market Segmentation
Demographic Segmentation
 Dividing the market into groups
based on variables such as:
– Age
– Gender
– Family size or life cycle
– Income
– Occupation
– Education
– Religion
– Race
– Generation
– Nationality
Step 1. Market Segmentation
Psychographic Segmentation
Divides Buyers Into Different Groups Based on:
Step 1. Market Segmentation
Behavioral Segmentation
 Dividing the market into
groups based on variables
such as:
– Occasions
– Benefits
– User status
– Usage rate
– Loyalty status
– Readiness stage
– Attitude toward product
Segmenting International
Markets
Geographic
Location
Cultural
Factors
Factors Used
to Segment
International
Markets
Political and
Legal Factors
Economic
Factors
Step 1. Market Segmentation
Requirements for Effective Segmentation
Measurable
• Size, purchasing power, profiles
Accessible
• Segments can be effectively
of segments can be measured.
reached and served.
Substantial
Differential
Actionable
• Segments are large or
profitable enough to serve.
• Segments must respond
differently to different marketing
mix elements & programs.
• Effective programs can be
designed to attract and serve
the segments.
Discussion Connections
Using the segmentation bases you’ve just read
about, segment the skin cream market in our
country.
Describe each of the major segments and sub
segments.
Step 2. Market Targeting
Evaluating Market Segments
Segment Size and Growth
– Analyze current sales, growth rates and expected
profitability for various segments.
Segment Structural Attractiveness
– Consider effects of: competitors, availability of
substitute products and, the power of buyers &
suppliers.
Company Objectives and Resources
– Company skills & resources needed to succeed in that
segment(s).
– Look for Competitive Advantages.
Step 2. Market Targeting
Market Coverage Strategies
Company
Marketing
Mix
Market
A. Undifferentiated Marketing
Company
Marketing Mix 1
Company
Marketing Mix 2
Company
Marketing Mix 3
Segment 1
Segment 2
Segment 3
B. Differentiated Marketing
Segment 1
Company
Marketing
Mix
Segment 2
Segment 3
C. Concentrated Marketing
The promotional tools
Advertising
广告
Sales promotion
销售促进
Public relations and publicity
Personal selling
人员推销
Direct marketing
直接营销
公共关系与宣传
Vocabulary
laundry n.洗衣
E.g.: When does the wash come back from
the laundry?
送到洗衣店的衣服什麽时候取回来?
The report on the hospital mentions such
desiderata as a supply of clean laundry.
报告中提到该医院需要乾净的洗换物品.
variable n. 变量
E.g.: Winds are mainly light and variable.
风力较弱，风向多变。
The temperature was a variable in the
experiment.
在该实验中温度是个变量。
diversify vt. 使多样化
E.g.: Hill and woods diversify the
landscape.
山陵和树林点缀景色。
A factory must try to diversify for further
development.
一个工厂要获得进一步发展就要努力使
产品多样化。
zero in on 集中注意力于
E.g.: The congressional opponents zeroed
in on the bill.
国会中的反对派把矛头集中指向那项议
案。
The police zeroed in on two suspects who
had arrived three days before.
 警察把注意力集中在3天前到达的两个
可疑分子身上。
homogeneous adj.相似的
E.g.: The state or quality of being
homogeneous.
同质同质或相似的性质或状态
Procter & Gamble
Procter & Gamble sells many famous
brands of laundry detergent, hand soap,
shampoo, skin care potions and disposable
diapers in USA
why would P&G introduce several brands
in one category instead of concentrating its
resources on a single leading brand?
Market segmentation
Market targeting
Market Segmentation
In this increasingly diversified world, no
firm would be so naive or ambitious as to
assume that it can satisfy all the needs and
wants of all people. Marketing managers
have long realized that, for their efforts to
be effective and successful, they must
“zero in on” one or several, but rarely all,
segments of the market.
Definition
Market segmentation is the process of
dividing the total market into several
relatively homogeneous groups with
similar product interests based on such
factors as:
demographic
psychographic characteristics
geographic location
perceived product benefits.
1. Geographic variables
 It calls for dividing the
market into different
geographical units such as
nations, regions, counties or
neighborhoods. For
example, Campbell sells
Cajun gumbo soup in
Mississippi and makes it
cheese soup spicier in Texas
2. Demographic variables
Factors like age, gender, ethnic background,
race, religion, education and income make
people different from each other. Such
demographic differences influence people’s
buying decisions.
Procter & Gamble boldly
targets its Oil of Olay
ProVital moisturizing
creams and lotions at
women over 50 years of
age —— it helps to
improve the elasticity and
revitalize the appearance of
“maturing skin.”
3. Psychographic variables
People can also be grouped according to
their attitudes, motives, activities and
opinions.
 Early in 50’s, Ford and
Chevrolet were famous for their
advertisements focused on
different customers’ personalities.
The owners of Ford were likely
to be independent, self-central
and man-like. However, the
customers preferred Chevrolet
were conservative and
economical.
4. Product-use variables
People buying the same product can be
further divided according to their use of the
product.
Take a ball-pen for
example, teenagers in
school like colorful,
fancy and toy-like ballpens, however, office
clerks prefer sturdy,
practical and reliable
ones.
Market Targeting
After evaluating different segments, the
company must now decide which and how
many segments to serve. This is the
problem of target market selection. A target
market consists of a set of buyers who
share common needs or characteristics that
the company decides to serve.
1. Undifferentiated Marketing
Using this strategy, a firm might decide to
ignore market segment differences and go
after the whole market with one offer. This
mass-marketing strategy focuses on what is
common in the needs of consumers rather
than on what is different.
Coca Colas original marketing strategy was
based on this form. One product aimed at the
mass market in the hope that a sufficient
amount of buyers would be attracted, although
there are now changes in their product line to
cater for growing dietary and caffeine free
needs of consumers.
2. Differentiated Marketing
Using this strategy, a firm decides to target
several market segments or niches and
designs separate offers for each.
General Motors tries to produce a car for every
“purse, purpose, and personality.”
Nike offers athletic shoes for a dozen or more
different sports, from running, fencing, and
aerobics to bicycling and baseball.
3. Concentrated Marketing
The third strategy is especially appealing
when company resources are limited.
Instead of going after a small share of a
large market, the firm goes after a large
share of one or a few segments or niches.
Oshkosh Truck is the world’s largest
producer of airport rescue trucks and frontloading concrete mixers.
Tetra sells 80 percent of the world’s tropical
fish food
Steiner Optical captures 80 percent of the
world’s military binoculars market.
Keys to Exercises
II. Fill in the table below by giving the
corresponding Chinese or English equivalents.

洗衣用去污剂
market segmentation

种族背景
area differentiation

相似的需求
demographics

心理的
market targeting
 无差异性市场营销 concentrated marketing
III. Read the following extract about marketing.
In most lines there is one extra word which does
not fit in.
1) of
2) if
5)than 6) be
9)CORRECT
3) will
7) use
10)the
4) high
8) to
IV. Finish the crossword quiz with the world’s
25 leading brands.
 NOKIA
NESCAFE AMERICANEXPRESS
 GILLETTE
CITIBANK
ATT
 HONDA
IBM
BUDWEISER
 COCACOLA
BMW
TOYOTA
 MCDONALD’S
MARLBORO
INTEL
 SONY
MICROSOFT
FORD
Case Study
Starbucks: Brewing in the Whole World
SWOT Analysis Starbucks
 Strengths.
 Starbucks Corporation is a very profitable
organization, earning in excess of $600
million in 2004.The company generated
revenue of more than $5000 million in the
same year.
 It is a global coffee brand built upon a
reputation for fine products and services. It
has almost 9000 cafes in almost 40 countries.
 Starbucks was one of the Fortune Top 100
Companies to Work For in 2005. The
company is a respected employer that values
its workforce.
 The organization has strong ethical values and
an ethical mission statement as follows,
'Starbucks is committed to a role of
environmental leadership in all facets of our
business.'
Weaknesses.
Starbucks has a reputation for new product
development and creativity. However, they
remain vulnerable to the possibility that
their innovation may falter over time.
The organization has a strong presence in
the United States of America with more
than three quarters of their cafes located in
the home market. It is often argued that
they need to look for a portfolio of
countries, in order to spread business risk.
The organization is dependant on a main
competitive advantage, the retail of coffee.
This could make them slow to diversify
into other sectors should the need arise.
 Opportunities.
 Starbucks are very good at taking advantage of
opportunties.
 In 2004 the company created a CD-burning
service in their Santa Monica (California USA)
cafe with Hewlett Packard, where customers
create their own music CD.
 New products and services that can be retailed in
their cafes, such as Fair Trade products.
The company has the opportunity to
expand its global operations. New markets
for coffee such as India and the Pacific
Rim nations are beginning to emerge.
Co-branding with other manufacturers of
food and drink, and brand franchising to
manufacturers of other goods and services
both have potential.
Threats.
Who knows if the market for coffee will
grow and stay in favour with customers, or
whether another type of beverage or leisure
activity will replace coffee in the future?
Starbucks are exposed to rises in the cost
of coffee and dairy products.
 Since its conception in Pike Place Market, Seattle
in 1971, Starbucks' success has lead to the market
entry of many competitors and copy cat brands
that pose potential threats.
 'Starbucks' mission statement is 'Establish
Starbucks as the premier purveyor of the finest
coffee in the world while maintaining our
uncompromising principles while we grow.'
The following six guiding principles will
help Starbucks measure the appropriateness
of our decisions:
1. Provide a great work environment and
treat each other with respect and dignity.
2. Embrace diversity as an essential
component in the way we do business.
3. Apply the highest standards of
excellence to the purchasing, roasting and
fresh delivery of our coffee.
4. Develop enthusiastically satisfied
customers all of the time.
5. Contribute positively to our
communities and our environment.
6. Recognize that profitability is essential
to our future success.