Transcript Market Segmentation, Targeting and Positioning - Marketing

Chapter 4
Market
Segmentat
ion,
Targeting and
Positioning
© 2001 McGraw-Hill Australia PPT slides t/a Rix, Marketing: A Practical Approach 4th ed 4-1
Market Segmentation
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Definition—The process of dividing the total
market for a good or service into smaller groups,
each of which tends to be homogenous (or
similar) in all significant aspects.
One or more of these segments is then selected
as the firm’s target market(s).
A separate marketing mix is then developed for
each segment or group of segments. This is
referred to as ‘Market Segmentation’.
© 2001 McGraw-Hill Australia PPT slides t/a Rix, Marketing: A Practical Approach 4th ed 4-2
Market Coverage Strategies
Company
Marketing
Mix
Market
A. (Aggregation) Undifferentiated Marketing
Company Mix 1
Segment 1
Company Mix 2
Segment 2
Company Mix 3
Segment 3
B. (Multiple
segments) Differentiated Marketing
Segment 1
SINGLE
Marketing
Mix
Segment 2
Segment 3
C. (Single
segment) Concentrated Marketing
Benefits of segmentation

Segmentation enables marketers to:
– Identify and satisfy effectively specific
benefits sought by particular groups.
Identify needs, satisfy needs.
 Divide the market into segments by
separating marketing programs.
 Select target market (ref p 103 magazine
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groups).
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Action the market segmentation plan.
© 2001 McGraw-Hill Australia PPT slides t/a Rix, Marketing: A Practical Approach 4th ed 4-4
Limitations of segmentation
Segmentation can be expensive in terms
of production and marketing of products to
only those specific groups of the market.
 Mass production offers economies of scale.
 Standardisation of service offers: increased
delivery speed and efficiency.
 Increase in promotion, administrative and
inventory costs.
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© 2001 McGraw-Hill Australia PPT slides t/a Rix, Marketing: A Practical Approach 4th ed 4-5
Market segmentation process
1.
2.
3.
Identify the needs & wants of
customers.
Identify the different characteristics
between market segments.
Estimate the market potential.
© 2001 McGraw-Hill Australia PPT slides t/a Rix, Marketing: A Practical Approach 4th ed 4-6
STEP 1 Identify the needs &
wants of customers
Objective is to identify needs not
currently being satisfied.
 eg Airlines might offer business travel
although research shows that preferred
departure and arrival times vary to
those being offered.
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© 2001 McGraw-Hill Australia PPT slides t/a Rix, Marketing: A Practical Approach 4th ed 4-7
STEP 2 Identify the different
characteristics between market
segments
Identifying the characteristics that
distinguish particular segments from
others.
 eg Business persons require varying
flights and may opt to fly first or
business class instead of
economy class.
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© 2001 McGraw-Hill Australia PPT slides t/a Rix, Marketing: A Practical Approach 4th ed 4-8
STEP 3 - Estimate the market
potential
Marketers need to know if a market is
viable before segmentation occurs.
 Forecasting of market demand will
determine:
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– Market demand
– Market potential
– Sales potential
– Market share
© 2001 McGraw-Hill Australia PPT slides t/a Rix, Marketing: A Practical Approach 4th ed 4-9
Bases for segmentation
Ultimate consumers—buy goods and
services for personal or household use.
 Business users—buy goods and services
to generate a profit by reselling or using
products as part of the manufacturing
process.
 The segment determines the marketing
mix.
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© 2001 McGraw-Hill Australia PPT slides t/a Rix, Marketing: A Practical Approach 4th ed 4-10
BASES FOR SEGMENTATION
CONSUMERS -Segmentation Categories
Geographic—The study of city size,
urban/suburban/rural population
distribution and climate.
 Demographic—The study of
distribution of population’s age, sex,
income, stage in family cycle and ethnic
background.
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© 2001 McGraw-Hill Australia PPT slides t/a Rix, Marketing: A Practical Approach 4th ed 4-11
Segmentation Categories (slide2)
Psychographic—Personalties,
lifestyles, social class including Activities
Interests and Opinions (AIO).
 Behaviour towards products.
 Benefits desired or sought.
 Product usage rate.
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© 2001 McGraw-Hill Australia PPT slides t/a Rix, Marketing: A Practical Approach 4th ed 4-12
BUSINESS segmentation
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All consumer categories plus:
– Customer location
 Geographic concentration
– Type of customer
 Size, Industry,
 Organisational structure
 Purchasing style & criteria
– Type of buying situation
 New buy
 Straight rebuy
 Modified rebuy
© 2001 McGraw-Hill Australia PPT slides t/a Rix, Marketing: A Practical Approach 4th ed 4-13
Geodemographic clustering,
Values and Lifestyles.
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An extension of segmentation according
to demographic criteria is called
geodemographic clustering, this
also includes lifestyle variables.
© 2001 McGraw-Hill Australia PPT slides t/a Rix, Marketing: A Practical Approach 4th ed 4-14
Geodemographic clustering,
Values and Lifestyles.
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Values and lifestyles (VALS) categories.
Visible achievers
Something better
Look at me
Basic needs
Socially aware
Young optimists
A fairer deal
Real conservatives
Traditional family life
Conventional family life
© 2001 McGraw-Hill Australia PPT slides t/a Rix, Marketing: A Practical Approach 4th ed 4-15
Segmenting services markets
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Two key differences
– Customisation of the firms offerings to
individuals or groups.
– Avoiding clashes between incompatible
segments.
© 2001 McGraw-Hill Australia PPT slides t/a Rix, Marketing: A Practical Approach 4th ed 4-16
Conditions for effective
segmentation
• The characteristics used to categorise
customers must be measurable and the
data obtainable.
• The segment itself must be accessible
through existing marketing institutions
with a minimum of cost and waste.
• A segment must be large enough to be
profitable.
A USEFUL SEGMENTATION PROCESS MUST
MEET THREE CONDITIONS :PTO
© 2001 McGraw-Hill Australia PPT slides t/a Rix, Marketing: A Practical Approach 4th ed 4-17
Target market strategies
Must meet 3 conditions:
1.
2.
3.
Target market should be compatible with
organisations goals and images.
Marketing opportunity presented by the
segment must match the company’s
resources.
The business must generate a profit if it
is to continue its existence.
© 2001 McGraw-Hill Australia PPT slides t/a Rix, Marketing: A Practical Approach 4th ed 4-18
Positioning
Definition: the perception of a product
or organisation in the consumer’s mind
relative to their perception of other
offerings in the same category.
 The key words are perception in the
mind of consumer’s which include
attributes, benefits & brand.
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© 2001 McGraw-Hill Australia PPT slides t/a Rix, Marketing: A Practical Approach 4th ed 4-19
Positioning statement
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A statement that clearly and succinctly
identifies the target market, the
benefits offered to it by the product,
and the way in which the product is
differentiated from its competitors.
© 2001 McGraw-Hill Australia PPT slides t/a Rix, Marketing: A Practical Approach 4th ed 4-20
Positioning strategies
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Positioning:
– In relation to a competitor.
– According to a product class or attribute.
– By price and quality.
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Positioning can be in various forms, although
it will always incorporate a statement that
identifies, based on the marketing mix, how a
business wants their products or services to
be perceived in the minds of the consumer.
© 2001 McGraw-Hill Australia PPT slides t/a Rix, Marketing: A Practical Approach 4th ed 4-21
POSITIONING STATEMENT
EXAMPLE
CURVES GYM
“We offer a convenient
and modern,
supervised exercise
program for busy
women.”
Other Categories of Product Positioning
Product
Class
Quality
Price
Product
Attributes
Benefits
Offered
G
H
C
A
Against a
Competitor
D
E
B
F
Use
Or application
Users
© 2001 McGraw-Hill Australia PPT slides t/a Rix, Marketing: A Practical Approach 4th ed 4-23
Selecting a position
Positioning is the final step in the
segmentation/targeting process.
 Marketers must consider various factors
in deciding what position they should
seek.
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© 2001 McGraw-Hill Australia PPT slides t/a Rix, Marketing: A Practical Approach 4th ed 4-24
Factors of consideration
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Competition—look for a gap or niche.
Customers—seek product attributes.
The company—status of current image.
Repositioning—needs of target market
changed?
The marketing mix—must support the
selected position.
© 2001 McGraw-Hill Australia PPT slides t/a Rix, Marketing: A Practical Approach 4th ed 4-25
EXAMPLE POSITIONING STATEMENT
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Roast Beef Sandwiches. In this case "Roast Beef
Sandwiches" is the tagline. It clearly states/describes
what they sell.
A positioning statement is a more in depth
description of the product, it's competition, quality,
etc. The positioning statement might be "We slow
roast our beef for 3 hours to lock in all those
savory juices!", Or "Try something different for a
change" and "Tired of that same old burger?"
(regarding the competetion).
© 2001 McGraw-Hill Australia PPT slides t/a Rix, Marketing: A Practical Approach 4th ed 4-26
Sample positioning statements
– The most cost-effective place for small
businesses to purchase office supplies
online
– The most complete source of grills and
barbecue recipes for people who love to
cook
– The only Web site where corporate event
planners can schedule meetings online
http://www133.americanexpress.com/osbn/T
ool/webmarket/position.asp
© 2001 McGraw-Hill Australia PPT slides t/a Rix, Marketing: A Practical Approach 4th ed 4-27
Check-list for determining a positioning
strategy
i. What position do we own? ~in the
mind of the prospect.
 ii. What position do we want to own?
 iii. Whom must we outgun?
 iv. Do we have enough money?
 v. Can we stick it out? Consistency is
essential
 vi. Does our advertising match our
position?
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© 2001 McGraw-Hill Australia PPT slides t/a Rix, Marketing: A Practical Approach 4th ed 4-28
Positioning maps are also
referred to as perceptual maps
© 2001 McGraw-Hill Australia PPT slides t/a Rix, Marketing: A Practical Approach 4th ed 4-29
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© 2001 McGraw-Hill Australia PPT slides t/a Rix, Marketing: A Practical Approach 4th ed 4-30
© 2001 McGraw-Hill Australia PPT slides t/a Rix, Marketing: A Practical Approach 4th ed 4-31