Transcript Basic Marketing Concepts

Chapter 3 – Analyzing
Your Customers
What You’ll Learn
• Identifying customers
• What market segmentation is and the
four methods used to segment a market
• Analyze a target market
• Differentiate between mass marketing
and market segmentation
Identifying the Customer
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Culture
Social Class
Community
Family
Gender
Culture
Culture: An integrated pattern of behavior,
knowledge, and beliefs that are acquired
from a group and passed on to future
generations.
Ex. Values, rituals
Values & Rituals
Values
Ex. Cleanliness, individuality, honesty
Ritual: A formalized act that is performed
frequently.
Ex. Holidays, brushing your teeth.
Products & values that fit into an existing
culture have a better chance of success
than those that don’t.
Social Class
Social Class: A group sharing the same
economic or social status.
Ex. Income
Education
Occupation
Members of a social class live in similar
houses, think in similar ways, and
purchase similar items.
*Advertisers believe social class identifies
potential customers most reliably.
Community
Community: A group of people with a
common characteristic or interest living
within a larger society.
Ex. Neighborhoods
Baseball card collectors
Magazine/newspaper subscribers
Family
Family: A group of consumers.
Brand loyalty can be passed from one
generation to the next.
Gender
Advertisers present images that help to
define the role of gender in purchasing
their products, although differences in
consumption are not well defined.
Decision Making Process
Step 1: Define the Problem.
Step 2: Identify the Choices.
Step 3: Evaluate the Choices.
Step 4: Choose One.
Step 5: Act on Your Choice.
Step 6: Review Your Decision.
Analyzing Markets
Market segmentation
is a way of analyzing a
market by specific
characteristics in order
to create a target
market
Types of Segmentation:
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Demographics
Psychographics
Geographics
Behavioral
Demographics –
statistics that describe
a population in terms of
personal
characteristics.
• Age
– Baby Boom Generation
– Generation X
– Generation Y
• Gender
• Income
– Disposable income –
money left after
taking out taxes
– Discretionary income
– money left after
paying for basic
living necessities
such as food,
shelter, and clothing
• Marital Status
• Ethnic Background
U.S. Trend – The percentage of the
Caucasian population is declining,
while other ethnic populations
increase.
Psychographics
• Involves grouping people with similar
lifestyles, as well as shared attitudes,
values, and opinions.
– Activities
– Attitudes
– Personality & Values
Music teachers,
dancers, and other
music lovers would
be one category of
people who share
psychographic
characteristics.
Geographics –
Segmentation
based on
where people
live
Behavioral Segmentation
• Looking at the benefits desired by
consumers, shopping patterns, and
usage rate. Market benefits, not just the
physical characteristics of a product
Behavioral Segmentation
• Many businesses find that the 80/20 rule
applies.
• 80 % of a company’s sales are
generated by 20 % of its loyal
customers.
Mass Marketing Vs
Segmentation
• Mass marketing is not as popular as it
once was.
• Niche marketing (the current trend) –
markets are narrowed down and defined
with extreme precision.
5 Levels of Usage and
Commitment
1.
2.
3.
4.
5.
Nonuser
Switcher
New consumer
Brand-loyal consumer
Heavy user
Essential Elements of a
Positioning Strategy
• Substance
• Consistency
• Simple, Distinctive theme
Marketing Research
Marketing Research: The thorough
investigation of the planning,
preparation, and placement of
advertisements.
Why?
The advertiser can create an
advertisement that will accurately
reflect the target market’s world.