Transcript Market Segmentation

6
Segmentation, Targeting, and
Positioning: Building the Right
Relationships with the Right
Customers
Steps in Market Segmentation,
Targeting, and Positioning
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Market Segmentation
Geographic
World Region or Country
Region of Country
City or Metro Size
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Market Segmentation
Demographic Segmentation
• Dividing the market into
groups based on variables
such as:
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Age
Life-cycle stage or family size
Gender
Income
Occupation
Education
Religion
Race
Nationality
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Market Segmentation
Age and Life-Cycle Stage
• P&G has different toothpastes for different
age groups.
• Avoid stereotypes in promotions.
• Promote positive messages.
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Market Segmentation
Gender
• Women make 90% of home improvement
decisions.
• Women influence 80% of all household
consumer purchases.
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Market Segmentation
Income
• Identifies and targets the affluent for
luxury goods.
• People with _____ annual incomes can be
a lucrative market.
• Some manufacturers have different grades
of products for different markets.
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Market Segmentation
Psychographic
Social Class
Personality
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Psychographic Segmentation
When Honda
markets its Reflex
and Elite scooters,
it appeals to the
rebellious,
independent kid in
all of us.
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Market Segmentation
Behavioral
• Occasions:
– Special promotions and labels for holidays.
– Special products for special occasions.
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Market Segmentation
Behavioral
• Benefits Sought:
– Different segments desire different benefits
from products.
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Market Segmentation
• User Status:
Behavioral
• Usage Rate:
– Nonusers, ex-users
– Potential users
– First-time users
– Regular users
– Light
– Medium
– Heavy
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Market Segmentation
Behavioral
• Loyalty Status:
– Brands
– Stores
– Companies
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Market Segmentation
• Best to use multiple approaches in order to
identify smaller, better-defined target groups.
• Start with a single base and then expand to
other bases.
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Geodemographic Segmentation
• Claritas, Inc.
• Potential Rating Index for
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Zip Markets (PRIZM)
Based on U.S. Census
data
Profiles on 260,000 U.S.
neighborhoods
62 clusters or types
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Segmenting International Markets
Factors Used:
Geographic Location
Economic Factors
Political and Legal Factors
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Intermarket Segmentation
Teens show surprising
similarity no matter where in
the world they live. For
instance, this teen could live
almost anywhere. Thus,
many companies target
teenagers with worldwide
marketing campaigns.
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Market Segmentation
Requirements for Effective Segmentation
• Size, purchasing power, profiles
of segments can be measured.
Accessible
• Segments can be effectively
reached and served.
Substantial
• Segments are large or
profitable enough to serve.
• Segments must respond
differently to different marketing
mix elements & programs.
Actionable
• Effective programs can be
designed to attract and serve
the segments.
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Evaluating Market Segments
• Segment Size and Growth
– Analyze current segment sales, growth rates, and
expected profitability.
• Segment Structural Attractiveness
– Consider effects of: competitors, existence of substitute
products, and the power of buyers & suppliers.
• Company Objectives and Resources
– Examine company skills & resources needed to succeed in
that segment.
– Offer superior value and gain advantages over
competitors.
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Target Marketing Strategies
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Undifferentiated Marketing
• Focus is on common (not different) needs
of consumers.
• Product and marketing program are
geared to the largest number of buyers.
• Uses mass advertising and distribution.
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Differentiated Marketing
• Firm targets several market segments and
designs separate offers for each.
• The goal is to have higher sales and a
stronger position with each market
segment.
• This approach increases the costs of doing
business.
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Concentrated Marketing
• The focus is acquiring a large share of one
or a few segments of niches.
• Generally, there are fewer competitors.
• The Internet is ideal for targeting small
niche markets.
• There is some risk in focusing on only one
market.
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Micromarketing
• Tailoring products and marketing programs to
suit the tastes of specific individuals and
locations.
– Local Marketing: Tailoring brands and promotions
to the needs and wants of local customer
groups—cities, neighborhoods, specific stores.
– Individual Marketing: Tailoring products and
marketing programs to the needs and preferences
of individual customers.
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Choosing a Market Coverage Strategy
Factors to Consider:
Company Resources
Product Variability
Product’s Life-Cycle Stage
Market Variability
Competitors’ Marketing Strategies
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Socially Responsible Target Marketing
• Smart targeting helps both companies and
consumers.
• Target marketing sometimes generates
controversy and concern.
– Vulnerable and disadvantaged can be targeted.
– Cereal, cigarette, beer, and fast-food marketers
have received criticism.
– Internet has raised fresh concerns about
potential targeting abuses.
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Positioning for Competitive
Advantage
• Product’s position is the way the product is
defined by consumers on important
attributes.
• The place the product occupies in
consumers’ minds relative to competing
products.
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Choosing a Positioning Strategy
#1 Identify a
set of possible
competitive advantages on
which to build a position
#2 Choose the right
competitive advantages
#3 Select an overall
positioning strategy
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Identifying Possible Competitive
Advantages
• Key to winning target customers is to
understand their needs better than
competitors do and to deliver more value.
• Competitive advantage – extent to
which a company can position itself as
providing superior value.
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Identifying Possible Competitive
Advantages
Product
Differentiation
(e.g., consistency,
durability, reliability,
repairability)
Image
Differentiation
Services
Differentiation
(e.g., speed, convenience,
careful delivery)
Channel
Differentiation
(e.g., convey benefits and
positioning)
People
Differentiation
(e.g., hiring, training
better people than
competitors)
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Positioning Errors
• Underpositioning:
• Overpositioning:
– Giving buyers too narrow a picture of the
company.
• Confused Positioning:
– Leaving buyers with a confused image of a
company.
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Choosing Right Competitive Advantages
Important
Distinctive
Affordable
Superior
Preemptive
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Possible Value Propositions
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Value Proposition
“Much more for much
more” value
proposition: HäagenDazs offers its superpremium ice cream at
a price never before
charged.
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Communicating and Delivering
the Chosen Position
• Company must take strong steps to deliver
and communicate the desired position to
target consumers.
• The marketing mix efforts must support the
positioning strategy.
• Must monitor and adapt the position over time
to match changes in consumer needs and
competitors’ strategies.
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